Moon's mismanaged alternative energy projects wasted at least $187M

Politics

Published: 14 Sep. 2022, 17:49 Updated: 14 Sep. 2022, 17:56

Moon's mismanaged alternative energy projects wasted at least $187M

The Office for Government Policy Coordination announced Tuesday that more than 261 billion won of funds from taxpayers’ pockets was misused for solar power and other renewable energy sources projects during the previous Moon Jae-in administration. [Office for Government Policy Coordination]

The Prime Minister's Secretariat revealed that at least 261 billion won ($187 million) of taxpayer funds were mismanaged by the Moon Jae-in administration for solar power and other renewable energy sources projects.

The Office for Government Policy Coordination, which is under the Prime Minister's Secretariat, said Monday that a probe into projects supported by the electric power industry infrastructure fund unearthed 2,267 cases of illegalities or mismanagement by 12 local governments over five years.

The electric power industry infrastructure fund gets 3.7 percent of all electricity bills paid in Korea.

The year-long probe was done by the Office for Government Policy Coordination's anticorruption team and the Ministry of Trade, Industry and Energy. The Moon government's solar power and renewable energy initiative received some 12 trillion won from the infrastructure fund since 2018.

The probe took place from last September to August and focused on energy projects led by local governments near Sejong City, a tiny percent of all local governments nationwide.

The office said that 261.6 billion won, or some 12.5 percent of the 2.1 trillion won reserved for renewable energy projects in the investigated regions, was found to have been improperly managed.

There were instances of fake tax invoices, poor accounting, inflated construction costs, contracts with unregistered companies and falsified documents.

The mismanaged funds related to solar power projects alone amounted to 210.8 billion won, or 80.5 percent of the total mismanaged funds uncovered.

There were around 20 cases of agricultural facilities, including for mushroom cultivation and insect breeding, built specifically to get 34 billion won in loans reserved for solar power projects. Those kind of farm facilities were required to get projects approved.

There were a total of 1,406 cases of illegal or inappropriate loans, amounting to 184.7 billion won.

Of 395 solar power projects operated by four local governments, 99 projects, or 25 percent, falsified tax invoices worth 20.1 billion won.

According to a full investigation into improper loans related to 6,509 solar power support projects conducted by the Korea Energy Agency from 2019 to 2021, there were 1,126 cases of illegal contracts with unregistered companies and other subcontracting regulation violations.

"Taxpayers' money was leaked away like water poured into a bottomless jar," Prime Minister Han Duck-soo said Tuesday.

The Office for Government Policy Coordination plans to expand the probe nationwide. The total amount of wasted funds is expected to exceed 1 trillion won.

"As [the Moon Jae-in government] pushed its renewable energy policy drive," Bang Moon-Kyu, minister of the Office for Government Policy Coordination, said in a briefing Tuesday, "there was not enough time to prepare properly, resulting in a large number of poorly executed [energy projects]."

Another official from the Government Policy Coordination Office said that illegal subsidies will be recovered through the subsidy act and that loans attained unfairly may be investigated.

President Yoon Suk-yeol reportedly said Tuesday that people who misused funds for national projects and other subsidies "should be severely punished" after being briefed on the results of the probe.

BY SARAH KIM [kim.sarah@joongang.co.kr]