SOUTH KOREA Law and Practice Contributed by: Michael Chang, Sang-Hyun Lee, Su-Yong Jung and Jae-Wook Ryu, Shin & Kim
5. Distribution 5.1 Constructing and Operating Electricity Distribution Facilities The main laws governing the construction and opera- tion of the distribution facilities are also the Electric Utility Act and the Electrical Construction Business Act. Under the Electric Utility Act, a licence is required for electricity business operation and the authority to grant such licence lies with the Minister of MCEE, in principle. For the construction of electricity distribution facilities, the electricity construction business should be registered according to the Electrical Construction Business Act (see 3.1 Constructing and Operating Generation Facilities for registration standards). Meanwhile, South Korea’s electricity distribution mar- ket is also dominated by KEPCO, as previously men- tioned. The Electric Utility Act stipulates the provisions for transmission facilities and distribution facilities in parallel and applies the same rules, therefore refer to 4.2 Obtaining Approvals to Construct and Oper- ate Transmission Lines and Associated Facilities for details. 5.3 Terms and Conditions Imposed in Approvals to Construct and Operate Electric Distribution Facilities See 3.3 Approvals to Construct and Operate Gen- eration Facilities . The electricity business is inclusive, referring to all electricity-related businesses such as the electricity generation business and the electricity distribution business. The conditions of the EBL apply similarly to the distribution business. 5.4 Eminent Domain, Condemnation or Expropriation Rights to Construct and Operate Electricity Distribution Facilities For the installation of electricity distribution facilities, ownership or use rights over the project site, such as rights in the land, superficies, or lease, are required. 5.2 Regulatory Process for Obtaining Approvals to Construct and Operate Electricity Distribution Facilities
The Electric Utility Act does not explicitly stipulate how an electricity transmission business operator shall contest the approval of the Minister of MCEE in relation to the regulation for the use of transmis- sion facilities. However, if the licence is illegal or unfair, KEPCO may contest it in accordance with the general principles and procedures of administrative litigation. While there is no explicit procedure for contesting the current regulation, an operator can apply for the change to the licence conditions by attaching the statement of grounds for change. 4.7 Open-Access and Non-Discriminatory Transmission As described in 4.6 Transmission Charges and Terms of Service , “the use of electric facilities without dis- crimination shall be guaranteed” is one of the licens- ing criteria in the facility usage regulation. The usage regulation provided by KEPCO also pro- vides that “KEPCO, in providing usage of electricity transmission and distribution facilities, shall ensure that the customers can use such facilities without being unfairly discriminated against” (customers include both consumers in demand and power gen- erators). If a customer makes an application to use KEPCO’s transmission and distribution facilities, KEPCO shall conduct a technology review of the access plan and make an offer of connection to the customer. The cus- tomer shall accept the offer and KEPCO shall allow the customer to use the transmission and distribution facilities by negotiation and execution of a Term of Use Agreement with the customer within one month after KEPCO receives the acceptance of offer notice. The First Renewable Energy Basic Plan indicates a complete overhaul of the existing first-come, first- served method of granting grid connection rights to a system that evaluates economic feasibility and public interest before granting rights, in part to prevent grid hoarding and the trading of grid connection rights.
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