The Sinan Ui offshore wind project, the first business under the National Growth Fund, risks imposing over 5 trillion won in Renewable Energy Certificate (REC) support costs on the public over the next 20 years if it proceeds without sufficient improvement to its business case, according to claims raised in the National Assembly.
Concerns remain over risks of reduced power generation due to grid congestion, inadequate seabed surveys, and military radar obstruction. Lawmakers are calling for a full review of the project's implementation process and government oversight.
Revenue structure heavily dependent on REC support
According to data submitted to Rep. Lee Heon-seung of the People Power Party (Environment & Labor Cmte, Busanjin-gu) by the Korea Development Bank, of the estimated 7.0939 trillion won in operating revenue for the Sinan Ui offshore wind project from 2029 to 2048, electricity sales revenue accounts for only 1.8288 trillion won, while REC sales revenue reaches 5.2651 trillion won, representing 74.2 percent of the total.
REC revenue is roughly three times larger than electricity sales revenue. The Sinan Ui offshore wind project has signed a 20-year long-term supply contract with KOEN (Korea South-East Power), and with an REC multiplier of 3.173 applied to offshore wind, the proportion of REC support far exceeds electricity sales revenue.
According to Rep. Lee, the project's economic viability is not sufficiently secured on its own, and instead relies on long-term REC support to underpin profitability. While this guarantees stable revenue for the developer, the costs are expected to be passed on to the public through electricity bills.
Grid capacity and infrastructure concerns
Risks remain that electricity generated cannot be fully supplied due to insufficient grid capacity. During deliberation of the National Growth Fund, sensitivity analysis was conducted assuming output curtailment of up to 11 percent.
Seabed issues have also been flagged. Some pin piles anchoring the substructure of the turbines have experienced penetration errors differing from design specifications, requiring reinforcement measures through design modifications, according to claims raised.
The military radar obstruction problem remains unresolved. Although part of the project area overlaps with the Air Force's air defense control radar operating zone, the project proceeded without finalizing coordination on measures to address the obstruction. Security concerns have also been raised regarding civilian operation and ownership of the proposed backup radar system.
Project overview and funding
The Sinan Ui offshore wind project is South Korea's first large-scale offshore wind project using purely domestic capital and the first to install 15-megawatt turbines. Hanwha Ocean, KOMIPO (Korea Midland Power), SK Eternix, and Hyundai E&C are participating in the project.
The project was selected as the first investment business under the National Growth Fund, securing a major funding base. Of the total project cost of 3.4 trillion won, approximately 1.3 trillion won, or about 40 percent, is being raised through the National Growth Fund and the Future Energy Fund.
Original Korean article: Energy Daily
English brief by Korea Wind Intelligence, koreawindintel.com
KWI developer profile — Hanwha Ocean
4 projects in Korea totalling 1,730 MW. Compiled from the KWI database. Not part of the source article.
Sinan Ui Offshore Wind — this article
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ChilHae 1 Offshore Wind
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ChilHae 2 Offshore Wind
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Boryeong Nokdo Offshore Wind
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Related coverage
- Swiss Re leads Sinan Ui offshore wind construction insurance syndicate — 2026-10-02
- Sinan-Ui offshore wind taps Vestas turbines despite domestic growth fund mandate — 2026-09-23
Project data: KWI database — Electricity Business Licence records, EIA filings (ME2021C012, ME2026C003, ME2026C014), Electricity Regulatory Commission minutes, and pre-EBL permit filings.
