As large-scale new investments such as semiconductor clusters and artificial intelligence (AI) data centers enter full swing, the government has significantly raised its 2040 peak power forecast up to 165 GW. In just a few months, this is an increase of up to 26.8 GW from the existing forecast. As the starting point of electricity demand has changed, plans for the power mix—including renewable energy, nuclear power, and liquefied natural gas (LNG)—and power grid expansion in the 12th Basic Plan for Electricity Supply and Demand are also being redrawn.
The Ministry of Climate, Energy and Environment and the Steering Committee for Establishing the 12th Basic Plan for Electricity Supply and Demand held the 5th Public Policy Forum at the Members' Office Building of the National Assembly on the 20th and unveiled a provisional plan for this “Electricity Demand Re-forecast.”
Considering uncertainties such as the spread of AI and the pace of electrification, the government presented two scenarios for demand forecasts: baseline and target. The baseline scenario assumes the current economic growth trend and a 53% reduction path for the 2035 Nationally Determined Contribution (NDC), while the target scenario assumes a high growth rate driven by the spread of AI and economic structural reform, along with a 61% reduction path for the 2035 NDC. Concrete investment plans for semiconductors and data centers were commonly reflected in both scenarios.
The 2040 target peak demand recalculated by the government is 158.4 GW for the baseline scenario and 165.0 GW for the target scenario. These figures increased by 26.6 GW and 26.8 GW, respectively, from the originally forecast 131.8 GW and 138.2 GW. Electricity consumption forecasts also jumped by about 190 TWh, rising from the previous 657.6-694.1 TWh to 847.3-885.1 TWh.
The core driver that raised the forecast figures is mega-projects. In particular, new semiconductor investments led the increase in electricity demand.
As a result of the government re-surveying corporate investment plans following the announcement of mega-projects, the 2040 potential contracted power capacity—combining the early completion of the Yongin Semiconductor Cluster, the new creation of the Honam Region Cluster, and fab expansions in Pyeongtaek and Cheongju—reached approximately 40 GW. Considering investment uncertainty, the government plans to prioritize reflecting 36.8 GW of this in the demand for the 12th Basic Plan for Electricity Supply and Demand, while reviewing plans to reflect the remainder in subsequent basic plans depending on the progress of investments.
Kim, minister of climate, energy and environment, explained, “Originally, companies said they would build semiconductor factories in Yongin by 2050, but as they all stated they would build them within 2040, demand increased significantly.” He added, “Demand for building four semiconductor factories on the site of the Gwangju Military Airport was also newly included.”
Demand for AI data centers is also increasing significantly. The 2040 data center investment plans presented by companies stand at 20.8 GW in terms of contracted power capacity. The government will prioritize reviewing 10.8 GW in this basic plan considering the level of project concrete realization, while reviewing the remaining 10 GW in subsequent basic plans according to project progress.
Accordingly, the 2040 peak demand for data centers is forecast at 14.2 GW. Additional demand excluding the trend portion is 11.9 GW, an increase of 7.9 GW from the originally forecast 4.0 GW. The net increase based on electricity consumption also increases more than threefold, from the existing 26.5 TWh to 84.9 TWh.
Which power generation sources will be used to meet the increased electricity demand is a core issue for subsequent forums. The renewable energy supply forecast, which was originally scheduled to be addressed on this day, was separated into a dedicated forum. The Ministry of Climate, Energy and Environment will hold the 6th Policy Forum on the 26th to disclose a provisional plan for the supply forecast by renewable energy source, such as solar and wind power, through 2040.
