South Korea’s LNG deals with US cast doubt on its coal-cut climate pledge

Summary

South Korea’s climate push to retire most of its coal power by 2040 is colliding with parallel negotiations that could shift the country’s energy buying toward U.S. gas exports, according to officials and experts discussing the issue. South Korea’s new climate ministry outlined coal- and emissions-cutting plans at recent United Nations climate talks, while the government’s trade discussions with Washington have raised questions about whether LNG procurement will slow or divert the transition.

The Ministry of Climate, Energy and Environment said it plans to retire most of South Korea’s coal-fired power plants by 2040 and at least halve its carbon emissions by 2035. The climate pledge, however, is being weighed against talks for a broader U.S.-South Korea energy and trade package that would include large investment and LNG purchases, with climate advocates warning the arrangement could extend fossil-fuel dependence.

Michelle Kim, an energy specialist for the U.S.-based Institute for Energy Economics and Financial Analysis, said it was unclear how South Korea would “manage and consolidate all this somehow contradictory planning regarding its energy sector,” pointing to the coexistence of coal-reduction goals and LNG-driven procurement plans. Climate and energy groups argue that even if LNG burns cleaner than coal, it still produces planet-warming emissions, particularly methane, and could function as a bridge fuel that becomes a longer-term fixture.

South Korea’s current administration under President Lee Jae Myung campaigned for stronger climate commitments after previous targets softened under former President Yoon Suk Yeol. Kim Sung-hwan, the inaugural minister of climate, energy and environment, said South Korea needs to act responsibly as global temperatures rise and that the country has “a stronger sense of responsibility in tackling the climate crisis,” according to an interview with The Associated Press.

South Korea’s emissions goals also reflect political and economic pressure. The country’s goal to cut carbon emissions by 53% to 61% from its 2018 level fell short of what some climate activists expected, and business lobbies representing major manufacturers had proposed a 48% emissions reduction target, according to the report. Joojin Kim of the Seoul-based advocacy group Solutions for Our Climate said the range “presents an effort by the government to accommodate two very different ways of thinking about the economic and climate future of the nation.”

As part of efforts to avoid higher tariffs, South Korea has offered to import more U.S. LNG, but the final trade deal has not been announced. Industry analysis and U.S. federal documents reviewed in the reporting say any agreement under negotiation could last between three and 10 years, and that South Korea might import between 3 million and 9 million tons of American LNG annually depending on the deal’s length.

Environmental groups argue the LNG tilt could undercut South Korea’s climate trajectory if increased gas purchases lead to an overall rise in imports rather than a rebalancing of where gas comes from. Insung Lee of Greenpeace in Seoul said that if South Korea simply replaces coal plants with LNG, “that means the coal exit actually doesn’t lead to a green transition and merely shifts Korea’s addiction from coal to gas, which undermines the whole spirit of climate action.” South Korea’s LNG purchases, Lee said, could also intensify the emissions tradeoffs associated with adding more gas to the energy mix.

The reporting also compares the country’s transition pace with others. Renewable energy generated 7% of South Korea’s domestic power in 2022, according to the International Energy Agency, and government data show renewables increased to 10.5% last year—still described as one of the lowest levels among leading economies. By comparison, Japan produced 21% of its power from renewables, and Spain generated 42%, while clean energy provided about 30% of global electricity production in 2023, the report said.

South Korea’s energy plan relies not only on renewables but also on nuclear power as it phases out coal. Government data cited in the reporting say nuclear sources accounted for 31% of total electricity generation last year. The energy minister said South Korea will transition to a system focused on renewables and nuclear while phasing out coal, and that LNG will serve as a “complementary or emergency energy source” to make up for irregularities in renewable supply.

South Korea has also moved within the global policy landscape alongside its domestic planning, including joining the Powering Past Coal Alliance at the previous month’s climate talks. The reporting describes the step as largely symbolic, but says it signals “very clear government intention to move away from fossil fuels and towards clean power,” as characterized by Bruce Douglas of the Global Renewables Alliance.

Coal producers and regional markets face potential disruption as South Korea’s coal cuts take effect. The pledge to retire 40 of the country’s 61 coal sites by 2040 may be “an enforced transition” for coal exporters in the Asia-Pacific region, Climate Analytics’ James Bowen said, describing it as something major importers will likely translate into market changes. Bowen said, “The writing’s on the wall,” adding that one of the biggest coal customers is starting to move away from coal.

For South Korea, the key dispute centers on how its energy system will be reshaped as negotiations unfold. Michelle Kim of the IEEFA said companies that do not cut carbon emissions may face competitive disadvantages and that South Korea needs to speed up renewable deployment rather than remain tied to fossil-fuel industry dependencies, arguing that delay increases the overall risk in the transition.