S. Korea EV demand plunges in 2021, gov to ramp up renewable energy quota

The sales of EVs in South Korea have taken a plunge in 2021. The Korea Herald reports that EV sales have dropped by more than 45% in the first two months 2021 in comparison to the previous year.

From January to February 2021, Hyundai only managed to sell 175 units of the Hyundai Kona electric (29% drop from 2020) and Renault only sold 48 units of the Renault Zoe.

Tesla, on the other hand, sold 38 units only (down 97.6%) for the two-month period despite having just introduced the Model Y to the Korean market.

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According to industry watchers, local customers have been reluctant to purchase EVs this year due to delayed government decisions on subsidies and carmakers' planned launches of new models.

The Korean government is currently revising the tax structure for EVs in Korea to provide equity in tax payment. Currently, powerful EVs are taxed similarly to mid or small cars. As such, more premium EVs might experience a spike in taxes after the revision.

Also Read: Korean gov requires Hyundai and Kia to up EV sales, penalty if target not achieved

In other news, South Korea will be soon able to require big power generation companies to generate up to 25% of its electricity through renewable energy sources, starting October 21.

This is a big jump from the previous maximum threshold of 10% set by the renewable energy portfolio or RPS scheme introduced in 2012. Following the plan from 2012, the renewable energy quota has reached its maximum limit at 10%.

Also Read: South Korea ups electric car subsidies in 2021, but does not help Tesla

Passed on 24 March 2021, the revision to increase the required renewable energy quota to 25% from 10% will be effective starting 21 October 2021.