South Korea has set a policy direction to extend fixed-price offshore wind contracts from 20 years to 25 years. The government is still reviewing how the longer contract period will be applied.

The fixed-price bidding system was introduced in 2022. Under the current framework, an operator selected through the bidding process receives a guaranteed electricity price for 20 years.

The system allows offshore wind operators to secure stable revenue while enabling the government to procure electricity at a lower price.

Offshore wind projects require initial construction spending measured in trillions of won. Industry participants requested a longer contract period to spread investment recovery over additional years while maintaining a stable revenue period.

A longer term could also allow operators to submit lower electricity prices in future bidding rounds.

The government is considering whether to apply a uniform 25-year contract or permit operators to choose a term between 20 and 25 years.

Implementation could begin as early as the second half of next year. The government is reviewing how much the longer contract period could reduce the unit price of offshore wind electricity.