Cleantech Market Intelligence
Hopes to Spur EV Growth in South Korea
Electric vehicle (EV) sales in South Korea reached 2,821 units in 2015, compared with 1,183 units in the year prior. Considering that the 2015 goal was to have 5,000 units on the road in the country, the EV adoption rate has been rather low in South Korea, mainly due to the lack of charging infrastructure available in the country and consumer perceptions of the vehicles. Nonetheless, the central government and municipalities are introducing plans to push more EV sales. For example, the central government mandated that 25% of the government’s new vehicle fleet must consist of EVs starting in 2015. In addition, the city of Seoul and Jeju Island are aiming to deploy 50,000 EVs respectively by 2017.
Government Plans for 2016
In December 2014, South Korea’s Ministry of Trade, Industry and Energy (MOTIE) announced its goal to deploy 200,000 EVs and 1,400 fast-charging stations by 2020. In line with this goal, the latest press release from the Ministry of Environment states that the government will subsidize sales for 7,900 EVs, 30,400 hybrid electric vehicles (HEVs), and 3,000 plug-in hybrid electric vehicles (PHEVs) in 2016.
According to the press release, an EV driver can receive up to ₩12 million ($9,928) in purchase subsidies, along with a ₩4 million ($3,309) tax incentive and ₩4 million ($3,309) for the charging equipment. Eight EV models are eligible for this program – the Kia Ray, Kia Soul, Renault Samsung SM3, Chevrolet Spark, Nissan LEAF, BMW i3, Hyundai Ioniq, and Labo Peace (a heavy duty vehicle). HEV and PHEV drivers can receive ₩1 million ($827) and ₩5 million ($4,137) in purchase subsidies, respectively, as well as ₩2.7 million ($2,234) in tax incentives. Applicants are selected on a first-come, first-served basis or by a random drawing.
Charging Infrastructure Development
On the charging infrastructure side, there are currently 337 public fast-charging stations in the country with the goal of having 1,400 stations by 2020. That said, the government plans to build 150 stations this year. In addition, some public fast-charging stations may be privatized since the government is encouraging private participation in developing EV charging infrastructure.