Caixin
Jun 29, 2021 03:38 PM
BUSINESS & TECH

Samsung Urged to Use 100% Green Energy in South Korea and Vietnam

Photo: IC Photo
Photo: IC Photo

(Nikkei Asia) — Samsung must switch to using 100% renewable energy in South Korea and Vietnam — the tech conglomerate's two biggest production bases — even as those countries plan to build more coal-fired power plants, Greenpeace said in a report on Tuesday.

The environmental group’s report lauded Samsung Electronics for hitting a 2020 target of 100% renewables in China, Europe and the U.S., but warned it risked being eclipsed by other tech multinationals that “are using their buying power” to purchase solar and wind energy.

The world’s biggest smartphone maker, by contrast, uses fossil fuels for 82% of its power needs, Greenpeace said.

South Korea and Vietnam are pivotal to Samsung’s environmental impact because they constitute roughly 80% of the electronics maker’s energy use, according to Tuesday’s 59-page report. It said the company did not include the two Asian countries in the 2020 targets partly because of supply and infrastructure constraints.

With more companies rushing to announce climate goals, such as net-zero emissions by 2040, environmentalists are keen to ensure they follow through on their pledges.

“Promising is not an actual plan but a mere signal,” Greenpeace East Asia program director Hyunsook Lee told Nikkei Asia.

She urged Samsung to add Vietnam and South Korea to its 100% renewables campaign.

“This is our responsibility for thousands of global citizens who supported this campaign [to] make sure the campaigns are not used as a corporate green wash,” Lee said.

Companies should pay for clean electricity directly, either through power purchase agreements or by investing in renewable energy projects, the Greenpeace report said. The environmental group said these options are better than “green pricing,” whereby consumers pay a premium on their utility bills to support investment in renewables, and “renewable energy certificates,” which give users credit for energy consumed elsewhere.

Samsung in 2018 said it would go 100% renewable in China, Europe and the U.S. within two years. Greenpeace praised the “aggressive targets” but rated them as only partially achieved because the company relied on green pricing and energy certificates for 88% of the goal in 2019.

The group said the 2020 goal had helped make Samsung a climate leader but that it now risks slipping behind other tech companies.

Amazon bought more clean power than any other company in 2020, followed by France’s Total, Taiwan Semiconductor Manufacturing Co., and Verizon and Facebook in the U.S., according to BloombergNEF data.

“We are looking for more opportunities to expand usage in regions with the necessary systems and conditions,” Samsung told Nikkei Asia. “Recently, the conditions surrounding renewable energy use have improved in each country, enabling us to expect that our renewable energy usage will continue to grow.”

Domestically, Seoul has made limited progress on alternative energy, which is supposed to provide 20% of the country’s power by 2030 under the Renewable Energy 3020 plan. South Korea reached 8.1% renewable in 2019, down from 8.3% in 2018, according to the state Korea Energy Agency.

On June 21, however, a new government program began that allows consumers to buy renewable energy from producers, though they must sign a three-party deal that includes the monopoly Korea Power Exchange.

Samsung makes half of its smartphones in Vietnam and is the country’s biggest exporter.

Vietnam in 2019 became Southeast Asia’s largest producer of solar power, surpassing Malaysia and Thailand, according to energy consultancy Wood Mackenzie. But clean power has stalled, with state monopoly Electricity Vietnam saying in 2021 the country had to generate less renewable energy because it was overloading the grid.

At the same time Hanoi is plowing ahead with the Vung Ang 2 coal-fired power plant, with investment from Samsung C&T, despite protests from activists including Greta Thunberg.

The renewables hiatus could make it harder for Samsung to buy wind and solar power, apart from installing panels at its factories. Nevertheless, the company wants to join a delayed Vietnam pilot program allowing purchase agreements with private energy suppliers.

In South Korea, the company has installed photovoltaic cells at three locations and plans to do the same at two other spots, according to its 2020 sustainability report.

By the end of 2021, Vietnam and South Korea will be among the first Asian countries to boast of solar costs falling below those of coal, Wood Mackenzie forecasts.

This story was first published in Nikkei Asia.

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