Researcher urges heat pump adoption, new tariffs to decarbonize Korean heating
Lim Hyun-ji, an associate research fellow at the Green Energy Strategy Research Institute, highlights Jeju's ongoing heat pump heating electrification projects as a model for national heating decarbonization, recommending policy adjustments for wider adoption.
Our take
How can Korea leverage renewable energy curtailment to accelerate heating decarbonization?
The proposed 'Tamna Electric Forecast System' in Jeju, offering a 50% electricity bill discount during renewable energy curtailment, demonstrates a novel approach to integrate DERs by converting otherwise wasted electricity into thermal energy, thereby enhancing grid flexibility and providing tangible benefits to households.
Jeju's heat pump projects, particularly when integrated with VPPs and a curtailment-linked tariff system, offer a dual solution: they absorb surplus renewable energy, which would otherwise be curtailed, and simultaneously provide low-carbon heating. This mechanism transforms a grid stability challenge (curtailment) into an opportunity for demand-side management and decarbonization, effectively **monetizing grid flexibility** while reducing reliance on fossil fuels in the heating sector. The author argues that this model, if supported by appropriate time-of-use tariffs and public awareness, can be scaled nationally to address the ~2 million households currently without city gas access.
What the source says
- Jeju plans to implement the 'Tamna Electric Forecast System' which will offer a 50% electricity bill discount when renewable energy curtailment is forecast.
- In 2026, 95% of the government's heating electrification project volume was allocated to Jeju.
- The proposed 2027 budget for heating electrification is 85.9 billion KRW, approximately 5.5 times the 2026 budget of 15.7 billion KRW, with support expanding nationwide.
- New city gas pipelines in sparsely populated areas could become stranded assets as heating decarbonization reduces demand.
- Lim Hyun-ji recommends prioritizing heat pumps over pipeline expansion in non-city gas areas due to increasing costs and the risk of stranded assets.
- Lim Hyun-ji proposes developing time-of-use tariffs suitable for heat pumps, linked to renewable energy output, to utilize surplus electricity for heating.
- Lim Hyun-ji suggests systematically promoting heat pumps combined with solar PV as a realistic option for energy independence in non-city gas areas.
For investors — For investors and operators in Korean DER, the proposed 'Tamna Electric Forecast System' and the author's recommendations suggest a future where demand-side flexibility from heat pumps could be directly compensated, creating new revenue streams for VPPs and DER aggregators by utilizing curtailed renewable energy. This could drive significant investment in heat pump and thermal storage solutions, especially in non-city gas areas, if appropriate time-of-use tariffs are implemented.
Watch: Monitoring the formal announcement and implementation details of Jeju's 'Tamna Electric Forecast System' and the progress of the 2027 national heating electrification budget.
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