GS Caltex boss calls on South Korea to better manage demand
The head of one of South Korea's main energy companies told WEC 2013 his country needs to shift energy policy from a supply focus to managing energy demand
GS Caltex chairman Hur Dong-Soo told delegates that supply-based policies alone are not sufficient to curb greenhouse gas emissions and rein in energy costs. "We must manage energy demand," Hur said, adding that demand-oriented policies are â€œkey to what may appear to be contradictory goals - establishing a stable energy network and managing climate change".
South Korean energy use has surged in parallel with the transformation of the country from a mostly agrarian nation 50 years ago to the world's 12th largest economy.
Hur pointed out that South Korea traded just $7 billion worth of energy 40 years ago, compared with more than $1 trillion last year. Hur estimates South Korea's energy demand willl increase by 35% by 2035, putting additional pressures on the environment.
He added that fossil fuels must remain a part of South Korea's energy portfolio in the coming 20-50 years, as renewable energy sources, such as solar and biomass, are at present, too inefficient and expensive to replace hydrocarbons. For that reason, Hur said it is essential to put energy efficiency on South Korea's national agenda. "Put a ceiling on emissions, and let the market figure out how to meet those guidelines," he said. Hur also encouraged South Korean president Park Geun-hye to foster joint public-private reserch and development efforts in energy, as part of her 'creative economy' platform of policies.
He said he believed the entry of shale gas into South Korea's energy mix would help set a floor price for liquefied natural gas (LNG) of around $11 per million British thermal units (Btu), down form a post-Fukushima high of around $18/m Btu.
However, Hur added that for the foreseeable future, South Korea would remain dependent on LNG imports from Qatar and elsewhere.