South Korea’s Climate Ministry receives record 25.7 trillion won budget for mega-projects and electric vehicles

South Korea’s Climate, Energy and Environment Ministry has proposed a record budget of nearly 26 trillion won, combining industrial infrastructure spending with a broader push toward electric vehicles and renewable energy.

The ministry set its 2027 budget and fund expenditures at 25.7319 trillion won, an increase of 3.9737 trillion won, or 18.3%, from this year. The proposal will go to the National Assembly for review before a final decision in December.

About 1.9351 trillion won will support electricity and water supplies for mega-projects, including semiconductor industrial complexes and artificial-intelligence data centers. Electricity infrastructure will receive 1.5489 trillion won, including 572.4 billion won for transmission-side energy storage systems and 65.8 billion won for new substations intended to attract demand in regions outside the capital area.

The government also plans to spend 850 billion won to ease Korea Electric Power Corp.’s financial burden. That includes 350 billion won for electricity-rate support for vulnerable groups and special assistance programs, along with a further 500 billion won capital contribution to the company. Water-supply projects include 119.6 billion won for a semiconductor complex in the Honam region and 8.1 billion won for advanced industries in the Chungcheong region.

Electric-vehicle subsidies will rise to a record 2.1403 trillion won, supporting 430,000 vehicles next year, up from 300,000 this year. Renewable-energy financing will more than double to 1.5108 trillion won. Funding for rooftop solar loans will increase more than fourfold, while household solar support will expand from 100,000 to 200,000 homes.

The ministry will also expand electrification of heating, including heat pumps, and increase funding for urban flood prevention and water-quality improvements. The budget for major underground rainwater tunnels will rise to 81.5 billion won, with key construction planned for completion before the 2029 flood season.

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We will build infrastructure to supply electricity and water in a timely manner to support the growth of advanced industries, and lead the green transition in the era of the climate crisis through renewable energy, electric vehicles and heat pumps.