Trade, Industry and Energy Minister Lee Chang-yang, fourth from right in the back, speaks in a meeting at a hotel in Seoul, Thursday. Yonhap

By Lee Kyung-min

The government will sign an agreement with 30 high-energy-consuming firms to lower their power consumption, providing tax incentives, monetary rewards and greater policy assistance to businesses that adopt energy conservation campaigns, four government ministries said, Thursday.

The measures to streamline energy demand announced by the energy, finance, foreign and environment ministries are part of the new energy policy objective defined as raising energy efficiency 25 percent by 2027.

The broad efforts seek to strengthen the country's standing on the global stage. Korea is the world's 10th-largest energy consumer, using 1.7 times more energy than the OECD average. Korea is also ranked near the bottom at 33rd in energy efficiency among 36 OECD countries.

The government will reduce energy consumption by 22 million tons of oil equivalent (toe), a unit measuring the energy released by burning one ton of crude oil, by 2027. The amount is equivalent to six years of electricity use by the Seoul Metropolitan Government.

Thirty firms that consume over 200,000 TOE a year will sign an agreement with the government to set an energy use reduction goal, with environmental, social and corporate governance (ESG) considerations specified. The 30 entities account for 63 percent of the country's industrial energy use.

Efficient energy use in private and residential buildings will be improved, as backed by a new government program termed "energy cashback," a reward program whereby consumers will be given back energy they saved in the form of mileage or points that can be used to pay utility bills.

Cooperation between central and municipal governments will be strengthened to lower taxes for owners of buildings that meet strengthened standards of energy consumption. Eligible will be about 320,000 large buildings nationwide including private and state-run ones.

A new fuel-efficiency system will be introduced for medium and large electric buses and cargo vehicles of over 3.5 tons in capacity. The large transport vehicles account for only 3.6 percent of the total vehicles nationwide, but use 21 percent of the total energy.

A next-generation intelligent transportation network will be implemented to manage and operate the vehicles better.

An integrated digital command and management system will be set up to streamline and track energy demand better, with the supported of research and development investments to promote and stimulate innovation in energy efficiency.

"The government will overhaul the current energy use system, under a broader goal to lead change in the mindset of key stakeholders," an energy ministry official said.

"We will finalize the specifics of the energy policy next month, following public hearings to collect opinions from industry and experts."