Table of Contents
- Busan is evolving into a hub for energy new industries
- Background of the designation as the first dedicated region for distributed energy in the country
- Designated around Eco Delta City, Myeongji District, and Gangseo Industrial Complex
- Effects of reduced industrial electricity costs and investment costs
- Conclusion: Busan sets new standards in the energy industry
- Frequently Asked Questions (FAQ)
Busan is evolving into a hub for energy new industries
Busan has been selected as the first 'dedicated region for distributed energy' in the country. As mentioned in earlier posts, there were forecasts that Busan was suitable for this project, and with this official designation, Busan is set to leap as a central city for energy new industries.
This special region designation focuses on the activation of new industries centered around the efficiency of energy management utilizing energy storage devices (ESS) and artificial intelligence (AI). As a result, innovative changes are expected across various industries.
Background of the designation as the first dedicated region for distributed energy in the country
On November 5, Busan was finally selected as a dedicated region for distributed energy at the Energy Committee meeting chaired by the Minister of Climate, Energy and Environment.
The city of Busan applied for the designation of the distributed special zone in April, and in May, passed the review by the working committee to become a final candidate. This meeting succeeded in designating Busan as one of four municipalities along with Jeonnam, Gyeonggi, and Jeju.
Thus, Busan has further enhanced its potential for development in the field of distributed energy.
The dedicated zone for distributed energy is a system aimed at creating a local 'energy self-sufficient' system where electricity is produced and consumed within the area. This system is based on the "Special Act on the Activation of Distributed Energy," allowing local businesses to establish a self-sufficient energy ecosystem capable of direct trading without going through the electricity market. This system plays a crucial role in promoting local energy independence.
Designated around Eco Delta City, Myeongji District, and Gangseo Industrial Complex
The dedicated zone for distributed energy in Busan has been designated as 'new industry activation type.' This zone covers a wide area of approximately 49.9㎢ (15.1 million pyeong), including Eco Delta City and Myeongji District, as well as six industrial complexes in the Gangseo area (Myeongji Noksan, Mium, Shinho, Hwajeon, Saenggok, and International Logistics City). This designation is expected to have a positive impact on the local economy and the development of new industries.
The main business areas are as follows:
First, by installing energy storage systems (ESS), lithium iron phosphate (LFP) batteries will be used to store generated electricity and supply it when needed, thereby maximizing the stability and efficiency of the power system.
Second, by building an AI-based energy management system that integrates energy management systems (EMS) and artificial intelligence (AI), developing an innovative energy operation system that optimizes demand and supply in real-time.
Effects of reduced industrial electricity costs and investment costs
Businesses located in the Busan industrial complex are expected to receive various benefits from this policy. Not only will they reduce electricity costs, but they will also be able to cut back on equipment investment costs. Additionally, the relaxation of output restrictions on renewable energy is expected to yield various positive effects.
The effect of electricity cost reduction is significant. Through an energy storage system (ESS) with a total capacity of 500 megawatt-hours (MWh), a maximum cost reduction of 8% per company is possible. Overall, it is expected that Busan will save 15.7 billion won in electricity costs annually. Companies can charge electricity at cheaper night rates and utilize it during peak hours to maximize cost efficiency.
Furthermore, it will greatly help in reducing equipment investment costs. For advanced industries such as semiconductors and data centers that require uninterrupted power supply, individual facility investment costs can be reduced by about 250 billion won. This is regarded as an innovative model that allows companies to lessen their initial investment burden through the introduction of the ESS subscription service. Through this, companies can manage resources more efficiently and enhance their competitiveness.
As a solution to the issue of renewable energy output restrictions, there is the utilization of ESS for power storage and adjustment of distributed supply. By doing so, it is possible to alleviate output restrictions on renewable energies such as solar power, and it is expected to yield annual cost savings of about 4.4 billion won.
Additionally, the 500MWh of power storage capacity corresponds to the daily power consumption of approximately 42,000 households and is considered sufficient to operate five advanced data centers. This stable power supply base is expected to enhance competitiveness in attracting advanced domestic and foreign enterprises.
Conclusion: Busan sets new standards in the energy industry
The recently designated dedicated region for distributed energy is attracting attention as a leading case that drives Korea's energy transition policy beyond a simple regional project.
Busan is expected to grow as the nation's first truly decentralized energy self-sufficient city by creating an innovative energy ecosystem where ESS, AI, and smart grid technologies converge, centered around Eco Delta City and Gangseo Industrial Complex.
This development will serve as a foundation for sustainable urban development linked to Busan's future city strategies such as the BuTX rapid transit system, smart port, and autonomous transport system.
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Frequently Asked Questions (FAQ)
Q. What is the reason for Busan being designated as a dedicated region for distributed energy?
Busan was designated as a dedicated region for distributed energy due to its suitability for activating new industries utilizing energy storage devices and AI-based energy management.
Busan has emerged as the first dedicated region for distributed energy in the country, becoming a central city for energy new industries. This designation focuses on innovative industrial changes through efficient energy management via energy storage systems (ESS) and artificial intelligence (AI). It encompasses a wide area including Eco Delta City, Myeongji District, and Gangseo Industrial Complex, contributing to the establishment of a sustainable energy ecosystem.
Q. What is the core of the dedicated region for distributed energy制度?
The dedicated region for distributed energy is a system that creates a self-sufficient energy ecosystem where energy is produced and consumed locally and traded directly without going through the electricity market.
This system is based on the 'Special Act on the Activation of Distributed Energy,' allowing local businesses to trade energy directly without going through the electricity market. This promotes local energy independence and builds an efficient energy production and consumption system, contributing to local economic development and environmental protection. In Busan's case, it is designated as a new industry activation type special area, promoting innovative energy operations connected to advanced industrial complexes.
Q. What is the impact of the designation of the dedicated region for distributed energy on Busan's industrial complex?
Companies in the industrial complex can enjoy economic benefits such as electricity cost cuts and reduced investment costs, enhancing their competitiveness.
Companies within the Busan industrial complex are expected to reduce electricity costs by up to 8%, with an overall expected annual saving of 15.7 billion won. Additionally, equipment investment costs for uninterrupted power supply facilities in high-tech sectors like semiconductors and data centers are projected to decrease by about 250 billion won. This significantly contributes to efficient resource management and improved competitiveness for businesses by alleviating initial investment burdens through the introduction of ESS subscription services.
Q. What measures are in place in Busan's dedicated region for distributed energy regarding the relaxation of renewable energy output restrictions?
Busan is expected to utilize ESS to alleviate renewable energy output restrictions and achieve cost-saving effects through reliable power supply.
Busan aims to address output limitation issues by storing renewable energy outputs like solar power through energy storage systems (ESS) and adjusting distributed supply. It is expected to generate annual cost savings of about 4.4 billion won, and the 500MWh of storage capacity corresponds to the daily electricity consumption of approximately 42,000 households. This strengthens Busan's competitiveness in attracting advanced enterprises by providing the capability to support five high-tech data centers.
Q. What are the anticipated effects of Busan's dedicated region for distributed energy on future urban development?
Busan is expected to lay the foundation for sustainable urban development and future city strategies based on its innovative energy ecosystem.
Busan has been designed as a truly decentralized energy self-sufficient city through the integration of ESS, AI, and smart grid technologies. This energy transition lays the groundwork for sustainable development linked to future urban strategies like the BuTX rapid transit system, smart ports, and autonomous transport systems. It is anticipated that Busan will enhance its economic, environmental, and social value as a leading example of Korea's energy transition policy.
