International oil prices, which had hovered around $100 a barrel, settled at $80 on March 10. It is too early to relax because the price has come down. South Korea spent 160 trillion won importing oil and gas over the course of 2024, and about 70% of its crude comes from the Middle East. It also remains the case that about 70% of that crude and 18% of its LNG pass through the narrow waterway known as the Strait of Hormuz.
The government holds 208 days' worth of oil in reserve. With domestic energy self-sufficiency put at around 15% and import dependence at about 90%, 208 days is only a cushion and does not amount to a solution. That is also the background to President Lee Jae-myung's remark on March 5, when he cited the situation in the Middle East and said the transition to renewable energy must be accelerated.
Annual domestic power consumption is around 600TWh, and the share filled by renewable energy was about 10% as of 2025. In terms of capacity, solar at 32GW and wind at 2GW come to a little over 34GW. The government's target for renewable capacity in 2030 is 100GW. That means building twice what has been put up so far in a little over four years.
The system that has held up this target is the RPS. It works by requiring power companies with generation capacity of 500MW or more to fill a set share of the electricity they produce with renewable energy, and the mandatory share for 2026 is 15%. The Ministry of Climate, Energy and Environment, seeing this framework as insufficient to reach 100GW, has put forward a plan to change the RPS into an auction system in which the government leads on volumes and prices.
Work has also begun in the National Assembly. It is the amendment to the New and Renewable Energy Act introduced in January this year by Rep. Kim Jung-ho of the Democratic Party of Korea, which grants private power companies a separate status as "target management entities" and newly includes provisions that can release those under the deployment mandate from their obligations. It also opened a path to meeting the obligation by other means in place of building renewable energy directly. The share of the RPS mandatory supply volume borne by private power companies is 24.2% as of 2026.
Assessments are divided. Plan 1.5, a climate and environment think tank, said in its report "Proposals on the Direction of RPS Reform," released on March 11, that it would be difficult to reach 100GW under the current amendment. A design that lightens obligations and a goal that raises volumes are contained together in the same bill, so which side the weight falls on will determine whether the overhaul succeeds.
Circumstances on the corporate side are different again. About 100 people gathered at the "2026 Renewable Energy Market Outlook Webinar" held on March 10 by the Corporate Renewable Energy Foundation (기업재생에너지재단). In the foundation's survey of 192 demand-side and supply-side companies, 56.4% of demand companies cited high PPA contract prices as the biggest factor blocking the voluntary trading market. For 2025 solar PPA prices, 44.9% put them at 175-180 won/kWh and 26.5% at 180-185 won/kWh.
In the same survey, 52.1% of demand companies and 49.0% of supply companies placed expanded tax incentives for voluntary trading at the top of the list as the most urgent policy task. It means the lever for lowering prices lies on the side of the system. Since the auction system is one in which the government holds the volumes and the winning prices, how that design reaches corporate purchase prices becomes the key question. The detailed design has yet to be finalized.
For reference, the 2030 generation share target of 21.6% is on the low side compared with Japan's 22%, the United States' 23% and China's 30%. It is more useful to read it as a signal that the blueprint is still open than as a report card saying the country has fallen behind. The bill is under review, and the framework of the auction system is being drawn.
Companies that use electricity can add their views to industry discussions such as the foundation's webinar, and individuals can leave comments directly on this amendment on the National Assembly's legislative notice page. Once the review of the bill is finished and the auction design has hardened into a public notice, the room to change it shrinks sharply. Narrowing the gap between 160 trillion won and 208 days will be decided inside this door that is open now.
