South Korea’s top energy investment advisory firm Energy Innovation Partners (EIP) has set up a joint venture with a U.S. energy and data infrastructure developer to build green energy infrastructure and data centers in the country, hoping to recruit Big Tech firms as renewable energy buyers.

According to multiple sources from the investment bank industry on Wednesday, EIP has launched joint venture The Green Korea (TGK) with U.S. energy infrastructure project developer and investor Diode Ventures.

TGK is a financial platform company that will offer green energy and digital infrastructure projects in which multinational tech companies can take part. TGK plans to set up separate subsidiaries for each renewable energy – solar and wind power – generation business and data center business on expectations that global technology companies, currently major buyers of renewable energy in the world, would purchase locally sourced green energy.

TGK’s business model lies on RE100, a global initiative that promotes influential businesses across the world to voluntarily commit to converting their electricity use into 100 percent renewable energy until 2050. They can also reach RE100 goal by purchasing renewable energy certificates (RECs) for fossil fuel uses.

According to Climate Group, more than 340 companies have joined the RE100 initiative as of Wednesday. Some big companies have also requested suppliers to take part in the move to apply RE100 to entire supply network.

Big Tech companies – Amazon, Google, Meta, and Microsoft – take up 30 percent of global renewable energy purchases currently. Given that fact, TGK expects those global tech companies could become the major buyers of renewable energy in Korea for their digital business in the country.

TGK plans to spend 3 trillion won ($2.5 billion) in building a 1-gigawatt (GW) renewable energy generation facility in Korea in three years. It is also considering taking part in a 40-megawatt (MW) data center construction project of a local private university in North Chungcheong Province and also 150MW solar power development project with a local large company in South Jeolla Province.

Investment bank industry sources noted that TGK’s partnership with global firms will significantly increase demand for renewable energy in Korea.

“TGK can be a new business model for large companies at home and abroad to reach ESG target,” said Park Hee-jun, president of EIP. “It will be a win-win model in which companies are able to realize their carbon neutral goal through TGK’s development platform.”

By Park Chang-young, Kang Doo-soon, and Lee Eun-joo

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]