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As the world shifts towards renewable energy systems, legal frameworks are being developed to institutionalise advancements in South Korea, the Philippines and Taiwan

The Republic of Korea (South Korea) promulgated a Special Act on the Promotion of Offshore Wind Power Distribution and Industrial Development (OSW Promotion Act) in March 2025, which substantially alters the regulatory landscape for domestic offshore wind power development.

The OSW Promotion Act will replace South Korea’s existing “open door” policy for offshore wind power development with a government-directed and facilitated process, including a “one-stop shop” regulatory committee and a “fast-track” to obtain most required licences and permits. Specific details are expected to be publicised (with an opportunity for public comment) in the coming months through an enforcement decree and enforcement rules supplemental to the OSW Promotion Act.

Implications

The key implications of the OSW Promotion Act include the following.

Immediate cessation of new PWOPs. The restriction on the issuance of new PWOPs is effective immediately on promulgation. Going forward, any OSW projects that have not already obtained a PWOP may only be developed following selection to participate in a government-designated power generation zone.

One-stop shop and fast-track permits expected to streamline development. The establishment of the OSW Power Generation Committee as a “one-stop” authority overseeing most aspects of the development of OSW projects and the “fast-track” licensing and permit process that will grant deemed attainment of up to 28 development-related licences and permits within power generation zones will likely reduce the overall time required to complete OSW projects in South Korea.

A leg up for government-led projects. Certain provisions of the OSW Promotion Act establish grounds for preferential support to OSW projects developed by state-owned enterprises and quasi-governmental institutions, which will likely increase GenCo participation in OSW project development.

KIM & CHANG
39, Sajik-ro 8-gil, Jongno-gu
Seoul 03170, Korea
Tel: +82 2 3703 1114
Email: lawkim@kimchang.com

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Roadmap to exploring renewable energy in the Philippines

Harvesting renewable energy (RE) resources in the Philippines is legislated under the Republic Act No. 9513, otherwise known as the Renewable Energy Act of 2008 (RE Law). This dictates the overall framework for exploiting and generating biomass, geothermal, solar, hydro, ocean and wind power.

It provides a strategic programme to increase utilisation of renewable energy and institutionalises development of national and local capabilities in converting RE resources into useful power.

The law also promotes efficient and cost-effective commercial application of these RE systems by providing fiscal and non-fiscal incentives to developers.

Fiscal incentives

The exploration, development and utilisation of solar, wind, hydro and ocean or tidal energy is not subject to the 40% foreign equity limitation, except in respect of appropriating water directly from the source for power generation.

Fiscal incentives are granted to qualified RE developers and manufacturers, fabricators and suppliers of locally produced RE equipment, provided that required certifications or accreditations have been secured.

These incentives include: an income tax holiday of seven years; a VAT zero rating on RE developer’s relevant local purchases; and a VAT zero rating on the whole process of exploring and developing RE resources up to conversion into power, which includes but is not limited to services performed by subcontractors and/or contractors. Customs duty exemption on importation of machinery, equipment materials and parts are part of the incentives.

Net operating loss carry-over incurred within the first three years of commercial operation may also be claimed for a period of seven consecutive taxable years, along with a special corporate income tax rate of 10% after expiration of the income tax holiday, and VAT zero rating on the sale of power generated.

RE service contract

Enterprises exploring, developing and utilising RE resources in the Philippines need to apply for an RE service (or operating) contract.

The process and procedure for the application, award and administration of this contract are prescribed by the Revised Omnibus Guidelines Governing the Award and Administration of Renewable Energy Contracts and the Registration of Renewable Energy Developers, issued by the Department of Energy (DOE).

An RE contract has a term of 25 years from execution date, which may be renewed for another 25 years. Applying to geothermal, hydropower, ocean and wind power projects, it covers two stages of development.

The pre-development stage involves the conduct of a preliminary assessment and feasibility study up to financial closing and approval of declaration of commerciality of the project, including identification of the production area.

On the issuance of a certificate of confirmation of commerciality, a development/commercial stage follows involving the development, construction and commercial operation of the project, including production and utilisation of RE resources.

For solar, biomass and waste-to-energy projects, an RE operating contract also covers two stages of development.

The development stage involves the conduct of a final feasibility study up to financial closing, construction, installation, testing and commissioning until applying for a certificate of compliance.

The commercial stage involves commercial operation of the project, which commences with the Energy Regulatory Commission (ERC) issuing a certificate of compliance licence to operate a power plant to generate electricity.

Performance bond

An RE developer was originally required to post a performance bond or any other guarantee amounting to no less than the minimum expenditure commitment for the applicable contract year as a condition for the RE contract to take effect (although projects with a capacity of 5MW or below were exempt from such a requirement).

Developers failing to observe or perform their obligations under the submitted work programme could be penalised against the performance bond by the DOE.

But the issue of performance bonds is currently being re-evaluated. In December 2024, the DOE announced that it is firming up a policy that will reduce the performance bond requirements for offshore wind projects, from 20% to 5%. More recently, posting of performance bonds was suspended until further notice.

Feed-in tariff (FIT)

The FIT system offers cost-based compensation to RE developers to promote and help finance investments. It offers guaranteed FIT payments on a fixed rate per kWh basis for 20 years to eligible plants.

The FIT allowance is the subsidy for payment of the FIT. It is a uniform charge on electricity consumers supplied with power by the distribution and transmission facilities.

The National Transmission Corporation (TRANSCO), a government owned and controlled corporation and owner of the transmission assets, collects the proceeds under the FIT allowance, the rate of which is approved by the ERC.

The GEAP

The green energy auction programme (GEAP) is a competitive bidding process aiming to accelerate development and commercialisation of RE systems while encouraging free and active private sector participation and investment.

The GEAP consists of the green energy auction (GEA) and the green energy tariff (GET).

The GEA facilitates the selection of eligible plants for RE supply through competitive bidding. Facilities will offer new and existing capacities in megawatts, and prices not higher than the GEA reserve price (GEAR price).

The ERC determines the GEAR price. The bid prices of GEA participants are ranked from highest to lowest, from which the DOE declares the winning bidders.

The GET will be determined based on the winning bidder’s bid and paid out of the Green Energy Auction Allowance.

Similar to the FIT allowance, the Green Energy Auction Allowance is a uniform change to be determined by the ERC and administered by TRANSCO.

But to date, the ERC has not issued the Guidelines on the Collection of the Green Energy Auction Allowance (GEA-All) and Disbursement of the GEA-All Fund, which will be the basis for determination of the GEA-All.

Payment of the GET is governed by the renewable energy payment agreement to be entered into between the winning bidder and TRANSCO. Since implementation of the GEAP, the DOE has conducted three rounds of the GEA. The first milestone round was conducted in 2022, awarding 1,966.93MW worth of renewable energy projects for delivery from 2022 to 2025.

The second round (GEA-2) conducted in 2023 awarded 3,440.76MW worth of projects for delivery from 2024 to 2026.

A third round of GEA (GEA-3) was conducted on 11 February 2025 with an offered capacity of 7,500MW with delivery timelines between 2025 and 2035. This exceeded the installation target of 4,650MW.

The DOE is also planning two more rounds. GEA-4 will cater to integrated renewable energy and energy storage systems, while GEA-5 will cover offshore wind technologies.

Renewable portfolio standards

Renewable portfolio standards (RPS) oblige power industry participants such as distribution utilities or suppliers to source or produce a specified fraction of their electricity from eligible RE resources.

Mandated participants are:

1. 1. Distribution utilities for their captive customers;
   2. Retail electricity suppliers for the contestable market;
   3. Generation companies for their actual supply to their directly connected customers; and
   4. Other entities recommended by the National Renewable Energy Board.

Market and certificates

To facilitate compliance with the RPS, the RE Law mandated the DOE to establish the Renewable Energy Market (REM), where trading of Renewable Energy Certificates (RECs) corresponding to energy generated from eligible facilities may be made in compliance with the RPS. The DOE declared full commercial operation of the REM effective on 26 December 2024.

RECs are issued for every MW hour of renewable electricity generated by REM generators. They are issued by the Independent Electricity Market Operator of the Philippines, the renewable energy registrar. The REM is administered and operated by the renewable energy registrar.

Pursuant to REM rules, the Philippine Renewable Energy Market System was established, which is an enterprise-grade automated platform to be used by the renewable energy registrar in performing its functions, such as allocation and trading of RECs, and monitoring and assessment of compliance of mandated participants with their obligations under the RPS.

PUNOLAW
33rd Floor, The Podium West Tower,
12 ADB Avenue, Ortigas Center
Mandaluyong City, Philippines 1550
Tel: +63 2 8631 1261
Email: info@punolaw.com
Website:

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A guide to energy law in Taiwan

In response to the global imperative to mitigate carbon emissions, the government of Taiwan has established an ambitious objective of achieving “net zero emissions by 2050”. The government has delineated key strategies, including the decarbonisation of the overall electricity supply. Specifically, the government aims for 60–70% of total electricity generation to come from renewable energy and 20–27% from thermal power generation using carbon capture technology.

The policy framework stipulates an installed capacity of 29 gigawatts (GW) of renewable energy by 2025, rising to between 40GW and 55GW by 2050, with a primary emphasis on offshore wind and solar power. Concurrently, the government is actively promoting the development of alternative energy sources, including geothermal, biomass, ocean energy and hydrogen energy. Furthermore, the Renewable Energy Development Act (REDA) was amended in 2019, and again in 2023, to enhance the legal framework supporting renewable energy initiatives, ensuring a stable power supply while addressing air pollution and reducing carbon emissions.

To meet the supply chain requirements and adhere to environmental, social and governance standards, and to address the demand for corporate electricity purchases, the government of Taiwan is advancing the deployment of green electricity. This initiative includes encouraging the sale and supply of green energy and establishing a green electricity trading mechanism, which encompasses amendments to the Electricity Business Act and the REDA. These amendments will facilitate the provision of electricity to end users by renewable energy generators or retailers.

Offshore wind power

In the context of offshore wind power development, the government has delineated the process into three phases: the demonstration phase (phase one); the potential sites phase (phase two); and the zonal development phase (phase three).

During phase one, two demonstration projects were developed between 2013 and 2021, resulting in an installed capacity of about 237 megawatts (MW). In phase two, the Ministry of Economic Affairs (MOEA) allocated grid capacity to 16 projects, which includes those developed in two stages, culminating in a total installed capacity of approximately 5.5GW. Nine of the 16 projects have achieved commercial operation between late 2023 and early 2025.

Regarding phase three, the government has set regulations for allocating an additional 15GW of offshore wind energy capacity, scheduled for commissioning between 2026 and 2035. Under these regulations, 9GW will be allocated across three phases (designated as R3.1, R3.2 and R3.3) to meet grid connection targets between 2026 and 2031, with the remaining 6GW set for commissioning between 2032 and 2035.

Through auction processes, about 3GW of grid capacity was awarded to five projects in R3.1, and an additional 2.7GW was awarded to another five projects in R3.2. The administration contracts between the government and each developer for R3.1 and R3.2 were signed in late 2023 and early 2025, respectively. The auction date for R3.3 will be announced by the government at a later stage.

From phase two, the government launched local content programmes requiring offshore wind developers to commit to engaging with and procuring products and services from local suppliers. The local content requirements became more complex and stringent in R3.1 and R3.2, covering various components including wind turbines, cables, electricity facilities, foundations, vessels and other local services.

In R3.1, the local content requirements are divided into mandatory and bonus items. For R3.2, the government allocated 120 points to each identified local item, and each developer participating in the R3.2 auction is required to commit to localised items totalling a minimum of 70 points.

However, following the submission of auction proposals by R3.2 developers in April 2024, the EU requested dispute settlement consultations at the WTO regarding Taiwan’s local content criteria for offshore wind projects in July 2024. In November 2024, the EU and Taiwan reached an understanding concerning the WTO dispute over Taiwan’s offshore wind auctions.

To address the EU’s concerns regarding Taiwan’s local content requirements, the government confirmed that no mandatory local content requirements will apply to R3.3 or any future offshore wind projects. For R3.1 projects, since the administration contracts have been signed by all R3.1 developers, they remain obligated to comply with their local content commitments as stipulated in these contracts. Regarding R3.2 developers, the MOEA issued guidelines to ease the review standards for relaxing local content commitments. Specifically, an R3.2 developer may, pursuant to the R3.2 administration contracts, apply to the MOEA for exemption from a local content commitment if the quantity or delivery schedule of locally produced or supplied products cannot meet the grid connection deadline set in the R3.2 agreement, expected to be the end of 2028 or 2029.

Solar power

Land is a critical factor in the development of large-scale solar projects. Following local practices, most ground-mounted solar project sites are located in non-urban areas. Under the Regional Plan Act (RPA), solar projects can only occur on land with permissible zoning and the required land usage permit, according to various usage restrictions outlined in the RPA and its regulations. If conditions are met, developers must apply for a land category and/or zoning change to proceed with ground-mounted solar projects. The government initially planned to reorganise land categorisation by implementing a new set of rules to replace the RPA, known as the Spatial Planning Act (SPA), which was expected to take effect on 1 May 2025.

However, to provide local governments and industries more time to adapt to the SPA, the Legislative Yuan amended the SPA in December 2024, postponing the functional zone regime until 30 April 2031. As a result, the original land conversion regime under the RPA will continue to apply after 30 April 2025.

To promote solar projects, the MOEA and the Energy Administration (EA) have supported aqua-solar and agri-solar initiatives, and the solar projects that incorporate battery energy storage systems (solar BESS projects) in the past two years. For aqua/agri-solar projects, there are two main challenges:

1. 1. Due to certain government restrictions, project companies with majority foreign ownership must collaborate with local land management consultants to obtain and maintain the land usage permit; and
   2. The generation project company must ensure that fishery or agricultural production continues alongside the operation period of solar projects.

Regarding solar BESS projects, the MOEA and the EA will issue annual guidelines for bidding on these projects. The government offers two key incentives to encourage the development of solar BESS projects. First, there are differentiated tariff rates for power discharged by the BESS compared to that generated by the solar project, with more favourable rates applied to the BESS. Second, successful bidders for grid capacity associated with the BESS may opt to develop a new project with priority rights, equivalent to the capacity of the BESS.

The MOEA will continue to secure land through inter-agency collaboration while increasing installation capacity by pursuing a three-pronged approach:

1. 1. Government-to-government co-ordination mechanism. The MOEA will establish communication channels between central and local governments to reduce market entry barriers for developers;
   2. Rooftop projects incentive. A rooftop incentive mechanism will be introduced to reward small-scale projects, encouraging installations. For new large buildings, mandatory regulations will require structures with a floor area of 300 ping (991 square metres) or more to install solar projects; and
   3. Support and communication platform. A platform for application guidance and communication will be established, featuring a single-window advisory service, a management platform for large projects and a local communication platform.

Other new renewables

In light of the net zero carbon emissions target and the commitment to phase out nuclear power, the Executive Yuan and the MOEA are focused on maximising renewable energy sources, alongside offshore wind and solar projects.

From 2025 to 2035, new technologies will require immediate investment in areas such as hydrogen energy, geothermal energy and ocean energy.

For geothermal projects, the goal post of 2026 is to implement critical technologies like enhanced geothermal systems and advanced geothermal systems, as most geothermal potential lies at depths exceeding 3,000 metres.

In ocean energy, a demonstration site utilising medium-sized floats is expected by 2025. The plan also includes two hydrogen refuelling stations by 2025.

LEE AND LI, ATTORNEYS-AT-LAW
8F, No 555, Sec 4, Zhongxiao E Rd,
Taipei 110055, Taiwan, ROC
Tel: +886 2 2763 8000
Email: attorneys@leeandli.com

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