Jeonnam P1 offshore wind success model drives phases 2, 3 expansion

South Korea's first privately led offshore wind farm

On the afternoon of September 9, 2026, after a 50-minute boat ride from Jaeun-ri pier in Sinan County, Jeollanam-do, ten massive wind turbines were spinning powerfully in the wind. The height from the sea surface to the blade tip was 237 meters, comparable to the height of Seoul's 63 Building at 249 meters. These were the turbines of Jeonnam P1 - SK E&S Phase 1 offshore wind farm.

"Since commercial operation began last May and completion in December, we have been achieving a 97 percent capacity factor and a capacity factor in the low 30 percent range," said Kim Jin-chul, CEO of Jeonnam P1 - SK E&S and executive vice president of SK Innovation E&S, explaining the situation aboard the vessel. The Jeonnam P1 - SK E&S Phase 1 project was funded by SK Innovation E&S and Copenhagen Infrastructure Partners (CIP) in a 51 to 49 ratio. The reporter visited the offshore wind farm nine months after its completion, accompanied by the Korea Wind Energy Industry Association.

First 10 MW-class turbines and pioneering financing

Built approximately 90 kilometers offshore from Jaeun Island in Sinan County, Jeonnam P1 - SK E&S Phase 1 is equipped with ten 9.6 megawatt turbines from Siemens Gamesa. These were the first 10 MW-class offshore wind turbines installed in South Korea. Beyond this, Jeonnam P1 - SK E&S holds several other "first in Korea" titles. Kim explained that the company "conducted project financing for the first time in Korea using a non-recourse structure aligned with global standards, and was the first to be constructed using the monopile method."

Non-recourse financing means raising funds based solely on the project's viability and revenue, with financial institutions not pursuing repayment claims against major shareholders. In other words, banks lent money based purely on the project's business case. After being selected for the first time in the government's 2022 offshore wind competitive auction, Jeonnam P1 - SK E&S successfully raised 600 billion won from domestic and international financial institutions, allowing construction to begin in 2023.

While the west coast had previously used jacket-type substructures for offshore wind installation, Jeonnam P1 - SK E&S adopted the monopile method, driving a single large steel column, which reduced construction time and costs. Following Jeonnam P1 - SK E&S's success, subsequent offshore wind projects on the west coast are being pursued using the monopile method.

The company invested approximately 10 billion won to reinforce the bearing capacity of Mokpo New Port, the backup port, to transport nacelles and towers weighing 500 to 600 tons. As a result, Mokpo New Port now effectively serves as the backup port for multiple offshore wind projects.

Cost pressures and domestic supply chain development

Not everything proceeded smoothly. Following the Russia-Ukraine war, raw material prices surged, significantly increasing project costs. When Jeonnam P1 - SK E&S began construction, the anticipated construction cost was 6 billion won per megawatt, but it actually rose to approximately 9 billion won per megawatt.

Jeonnam P1 - SK E&S, as South Korea's first privately led offshore wind farm, holds multiple meanings for the domestic offshore wind industry. Kim explained that "by being selected in the government auction in December 2022 and completing construction in two and a half years, we have enhanced the credibility of the domestic bidding system and served as a catalyst for the domestic offshore wind industry through the establishment of a domestic supply chain."

Excluding turbines, Jeonnam P1 - SK E&S achieved 70 percent localization of engineering, procurement and construction through domestic suppliers: towers from CS Wind, substructures from Hyundai Steel Industries, submarine cables from LS Cable & System, onshore substations and transmission lines from Gaon-Hyundai Electric, and installation vessels from Hyundai Steel Industries.

Phases 2 and 3 moving forward

Building on the success of Phase 1, Jeonnam P1 - SK E&S is accelerating development of Phases 2 and 3. Jeonnam P1 - SK E&S Phases 2 and 3 are located west of Phase 1. Each is a large-scale project with a capacity of 400 megawatts. In August 2026, the company completed its environmental impact assessment, meeting the conditions to participate in the government's offshore wind competitive auction.

Jeonnam P1 - SK E&S Phases 2 and 3 plan to participate in the auction in the second half of this year and begin construction in the second half of 2028. If the plan proceeds as scheduled, commercial operation will begin in 2031. In that case, Jeonnam P1 - SK E&S will become a large-scale offshore wind farm with a total capacity of 900 megawatts. It is expected to serve as a major energy source for the government's Honam semiconductor cluster initiative.

Phases 2 and 3 are included in the Sinan offshore wind integrated zone (OWIZ), designated in April last year, which is expected to enable faster project implementation. Kim explained that "Phases 2 and 3 are located where government licensing constraints are minimized, and military operational coordination has been nearly completed." However, inflation-driven increases in construction costs are a burden. The wind energy industry has pointed out that if the government sets auction prices too low, it could eliminate opportunities for domestic supply chain companies to grow.

Operations and community benefit sharing

Jeonnam P1 - SK E&S operates an operations and maintenance center at Saenggkim Port. Approximately 30 people work there, including ten Siemens Gamesa employees. The first floor of the center houses a Siemens Gamesa parts storage warehouse. Kim explained that "even if a turbine malfunctions, we can respond quickly." The center's workforce is planned to expand to approximately 100 people by the time Phases 2 and 3 are completed.

Jeonnam P1 - SK E&S is also the first "wind income" model being implemented in Sinan County. Sinan County has received attention for its "sunshine income" initiative, which distributes a portion of solar power plant profits to cooperatives formed by residents. Jeonnam P1 - SK E&S shares wind income with Sinan County residents using the same method as sunshine income.

Lee Jung-su, director of renewable energy at Sinan County Office, explained that "from the second quarter of 2025 through the second quarter of this year, 5.5 billion won in profit-sharing funds were generated from Jeonnam P1 - SK E&S, with 45 percent distributed to residents of Jaeun-myeon and the remaining 55 percent distributed to other areas of Sinan County." Jeonnam P1 - SK E&S Phases 2 and 3 also plan to share profits with residents through the wind income method.

Wind income forms a complementary relationship with sunshine income, contributing to increased resident earnings. Lee explained that "wind power generation produces more electricity during the winter months from October through March when solar power generation is low, creating an effect of distributing profits consistently to residents throughout the year."

Grid connection challenges

Meanwhile, nine of the eleven projects in the Sinan offshore wind integrated zone (3.0 gigawatts out of 3.7 gigawatts) plan to connect to KEPCO's power grid using shared connection facilities. However, because they are not designated as national backbone power infrastructure, they are facing difficulties in securing acceptance from residents near transmission lines.

If designated as national backbone power infrastructure, developers can receive 2 billion won per kilometer in subsidies. Sinan County is requesting that the government designate shared connection facilities installed by private developers as national backbone power infrastructure under the National Backbone Power Grid Expansion Act.

KWI developer profile — SK E&S

3 projects in Korea totalling 894 MW. Compiled from the KWI database. Not part of the source article.

Project data: KWI database — Electricity Business Licence records, EIA filings (ME2024C017, ME2024C018), Electricity Regulatory Commission minutes, and pre-EBL permit filings.

Original Korean article: Asia Economy

English brief by Korea Wind Intelligence, koreawindintel.com