A dispute between the Ministry of Agriculture, Food and Rural Affairs and the Ministry of Climate, Energy and Environment has surfaced over a plan to require the Korea Rural Community Corporation to expand its renewable energy facilities. The agriculture ministry opposes the plan, arguing that imposing power generation targets on an agency whose core mission is supplying agricultural water could undermine its primary functions. The climate ministry says it will decide whether to designate the agency as a party subject to the supply obligation after consultations with related ministries.
According to the ministries involved on the 1st, the agriculture ministry plans to convey its opposition to designating the Korea Rural Community Corporation as a party subject to the renewable energy supply obligation to the climate ministry by Oct. 8. "Imposing an obligation based solely on the scale of renewable energy facilities held is an inappropriate standard that fails to consider the agency's founding purpose and duties," an agriculture ministry official said. The corporation expressed the same position a day earlier at a press briefing at the site of its floating solar power project in Saemangeum, Gunsan, Jeonbuk State.
The dispute stems from draft revisions to subordinate regulations under the renewable energy law being pursued by the climate ministry. The revisions set detailed standards in line with the January implementation of an amended law that will replace the current Renewable Portfolio Standard (RPS) with a long-term fixed-price contract market based on competitive bidding. Under the climate ministry's restructuring plan, a renewable energy supply obligation based on installed capacity will be introduced in place of the previous system based on power generation volume, with fines imposed for non-compliance. The climate ministry held a public hearing a day earlier to explain the draft and gather opinions.
At issue is whether the Korea Rural Community Corporation will be included. The draft enforcement decree would allow the minister to designate public institution power producers holding 100 megawatts or more of renewable energy facilities as parties subject to the obligation. Exceeding the threshold does not result in automatic designation, but the corporation's renewable energy facilities total 165 megawatts. According to the agricultural sector, the climate ministry's public hearing a day earlier included a plan to consider designating the corporation as a new party subject to the obligation.
The corporation is concerned that the financial burden could be enormous if it is included. Parties subject to the obligation must either install or secure through investment the installed capacity set by the government each year. For any shortfall remaining after deferrals or alternative compliance, fines of up to 150% of the amount based on the officially announced unit price may be imposed. The corporation estimated that fines would reach about 1.3 trillion won ($920 million) if it were assigned 1 gigawatt annually and failed to meet any of it.
The Korea Rural Community Corporation has expanded solar and other power generation businesses using reservoirs and freshwater lakes as it faced an annual shortfall of about 200 billion won in funding for agricultural water supply and management of aging irrigation facilities. It developed 306 megawatts through 2025, with 165 megawatts held directly. But concerns have emerged inside and outside the corporation that a business built to fund agricultural infrastructure could be turned into a vehicle for meeting national renewable energy supply targets.
The climate ministry says it will continue inter-ministry consultations. "Not everyone exceeding the 100-megawatt threshold will be designated as a party subject to the obligation," a climate ministry official said. "We plan to finalize the details through future consultations."
