If realised, these reforms will see South Korea turn away from coal and nuclear power: coal-fired power generation will drop from 40 per cent to 21 per cent of electricity generation capacity by 2030 and nuclear power will decline from 30 per cent to 22 per cent. These power sources will be replaced under Moon’s plan by gas-fired power and renewable resources, with gas-fired power’s share of the energy mix growing from 18 per cent to 27 per cent and renewables growing from 5 per cent to 20 per cent. This is an ambitious plan — it will require the installation of 47.2 gigawatts of new generating capacity from renewable resources in only 12 years.

This change in energy mix does not necessarily spell the end for South Korea’s nuclear industry. Despite the commercial success of the 2016 film Pandora (which depicts a near-future disaster involving a Korean nuclear power plant), recent polling suggests the public narrowly favours continued investment in nuclear power. As of February 2018, five nuclear reactor units are under construction: three at Kori Nuclear Power Plant and two at Hanul Nuclear Power Plant.

The continued role of nuclear power in South Korea’s energy mix along with greater renewable energy production will help South Korea meet or exceed its Paris Agreement targets, though it is worth noting that South Korea’s own carbon emission reduction targets are relatively weak among the advanced industrial economies.

The most interesting aspect of South Korea’s energy pivot will be its effect on liquefied natural gas (LNG) flows. In 2017, China overtook South Korea to become the world’s second-largest LNG importer behind Japan, as China also looks to shift focus from coal-fired to gas-fired power generation. Moon’s pivot away from coal could see a rebound in LNG prices, which have been depressed in the Asia Pacific region by excess supply from Australia and the United States.

South Korea is already working to develop the infrastructure necessary for such a shift. Korea Gas Corporation (KOGAS) plans to begin construction of the country’s fifth LNG-import terminal at Dangjin Port soon, with the facility to become fully operational by 2031. KOGAS also plans to continue diversifying its LNG supply. Qatar accounted for more than a third of the LNG imported by KOGAS in 2017, while the remainder was supplied by a wide range of countries, namely Australia, the United States, Russia, Oman, Brunei Darussalam, Malaysia, and Peru. Unless South Korea’s industrial activity dramatically declines, KOGAS will likely continue to favour a diverse portfolio of LNG suppliers on contracts with shorter terms than those expected by Japanese and Chinese LNG importers.

The wider-reaching implications of South Korea’s change in energy mix remain to be seen. This is admittedly not the first major shift in the country’s energy policy in the past decade. In 2010, South Korea switched to diesel and gasoline from mainly using liquefied petroleum gas as the fuel for its commercial vehicles, which required some modest infrastructure changes.

The infrastructure adjustments this time are likely to be more disruptive. The substantial increase in power generation capacity from renewable resources anticipated in Moon’s energy policy will require locating some power generation facilities closer to major population centres in order to avoid high transmission costs. This may prompt public backlash, with communities expressing concerns about the impact of a nearby wind farm or solar farm on their quality of life.

With his popularity having declined from 70.8 per cent in early December 2017 to 59.8 per cent just over a month later, President Moon will doubtless be sensitive to how negative sentiments could gain momentum. As such, those hoping to capitalise on a renewables expansion in South Korea should exercise caution. South Korea’s new wind turbines will need strong gusts to generate power, but political winds can change both rapidly and unfavourably.

Paul Pryce is Political & Economic Advisor to the Consul General of Japan in Calgary and a researcher for the Jakarta-based research institution UPH Analytics.