KOEN Hydrogen Strategy 2025: Powering South Korea’s AI Boom with Fuel Cells

KOEN’s Hydrogen Projects: From Pilots to Commercial-Scale AI Power Solutions

Korea South-East Power (KOEN) has strategically shifted its hydrogen focus from foundational supply partnerships to executing large-scale, application-specific projects directly targeting South Korea’s energy-intensive AI sector. This pivot aligns KOEN’s energy transition with the nation’s urgent demand for clean, stable power for massive new data centers. The company is now positioned as a critical infrastructure developer for the country’s digital economy.

* Between 2021 and 2024, KOEN’s hydrogen activities centered on building a future supply chain through broad Memorandums of Understanding (MoUs). Key initiatives included partnering with SK E&S and SK Plug Hyverse for green hydrogen and ammonia production and conducting techno-economic analyses for co-firing hydrogen in its existing gas power plants.
* Starting in 2025, KOEN’s strategy matured into developing concrete, high-value generation assets. The most significant move is the partnership with Samsung C&T to develop the $1.7 billion Dangjin Green Energy Hub, a 900 MW hydrogen fuel cell power plant designed specifically to supply a new $860 million AI data center.
* This transition from exploratory partnerships to building dedicated hydrogen power infrastructure demonstrates a direct response to the government’s ₩100 trillion ($65 billion) national AI initiative. The planned construction of massive AI data centers, projected to add over 4 GW of new power demand, created a clear commercial case for KOEN to advance its hydrogen projects.

Investment Analysis: Funding KOEN’s Clean Energy Pivot

KOEN‘s investment strategy reflects a calculated reallocation of capital from uncertain renewable projects toward large-scale, demand-secured hydrogen and gas infrastructure. While divesting from a stalled offshore wind project, the company committed billions to new fuel cell and LNG-backed power generation, supported by significant government funding aimed at the broader energy transition.

Table: Key Energy Investments Supporting South Korea’s AI Push (2025)

Partnership Analysis: Building Alliances for Hydrogen and AI

KOEN‘s partnerships have evolved from general clean energy collaborations to highly specific, strategic alliances with technology leaders and industrial giants. These recent agreements are designed to secure offtake, leverage global expertise, and build the dedicated infrastructure needed to power South Korea’s AI ambitions.

Korea South-East Power**’s geographic focus for hydrogen has pivoted from establishing international supply chains to developing large-scale domestic generation projects concentrated in South Korea’s industrial and technology corridors. This localization strategy is a direct reaction to the national imperative to power a domestic AI and semiconductor boom, requiring clean energy sources to be built close to the point of consumption.

* Between 2021 and 2024, KOEN‘s international strategy was prominent, exemplified by its MoU with SK Ecoplant to develop the UAE as an overseas production base for green hydrogen and ammonia. This approach focused on securing future fuel imports.
* The period from 2025 onward marks a decisive shift to domestic development. The cornerstone project is the Dangjin Green Energy Hub in Chungnam province, a major industrial region. This hydrogen fuel cell plant is co-located with a planned Samsung C&T data center, creating an integrated power-to-tech hub.
* Similarly, the MoU with Ørsted for the 1.4 GW Incheon Offshore Wind Project targets power generation near the Seoul metropolitan area, home to significant industrial and data center load. This domestic focus ensures energy security and grid stability for the nation’s burgeoning AI infrastructure.

Technology Maturity: KOEN Advances Hydrogen from R&D to Commercial-Scale Fuel Cells

Korea South-East Power‘s hydrogen technology strategy has matured from early-stage feasibility studies and co-firing research into the deployment of commercial-scale, dedicated hydrogen fuel cell power plants. This progression signals that hydrogen is no longer a long-term research topic for KOEN but a core component of its near-term strategy to provide stable, low-carbon power for industrial and digital infrastructure.

* From 2021 to 2024, KOEN was in an exploratory phase. The company provided data for techno-economic analyses of blending hydrogen in its combined-cycle power plants and formed partnerships, like the one with SK E&S, to investigate green ammonia co-firing. These activities were focused on adapting existing assets.
* The announcement in 2025 of the 900 MW hydrogen fuel cell plant with Samsung C&T marks a significant technological leap. This project moves beyond retrofitting and commits to a new-build, utility-scale facility using fuel cells, a technology that offers high efficiency and carbon-free power generation.
* This shift from research to a large-scale commercial project, with a targeted operation date of 2032, validates fuel cell technology as a viable solution for meeting the gigawatt-scale, 24/7 power demands of AI data centers, which cannot be met by intermittent renewables alone.

SWOT Analysis: Korea South-East Power’s Hydrogen and AI Strategy

Table: SWOT Analysis of KOEN’s Hydrogen Strategy

Future Outlook: Execution Risk Defines KOEN’s Path Forward

Korea South-East Power‘s success now depends entirely on its ability to convert its ambitious hydrogen and offshore wind agreements into operational, revenue-generating assets. The primary focus for the year ahead will be navigating the substantial execution, regulatory, and financial risks inherent in these gigawatt-scale projects to meet the aggressive timelines demanded by the AI industry.

* Progress on the 1.4 GW Incheon Offshore Wind Project with Ørsted will be a key indicator. Moving this project from an MoU to a final investment decision is critical for proving the viability of large-scale renewables in South Korea.
* Securing contracts under the Clean Hydrogen Portfolio Standard (CHPS) auctions is essential. The economic viability of the $1.7 billion Dangjin Green Energy Hub will depend on winning these government-backed offtake agreements.
* The final details of the government’s 11th Basic Plan for Electricity (BPLE) will be decisive. This policy will either create a streamlined path for projects like KOEN‘s or impose new hurdles that could cause delays.
* Ultimately, KOEN must demonstrate it has learned from the failure of the Shinan Ui project. Its ability to successfully permit and finance its new flagship projects will determine its role in powering South Korea’s digital future.

Frequently Asked Questions

Why did KOEN’s hydrogen strategy change around 2025?
KOEN’s strategy shifted from building foundational supply chain partnerships (2021-2024) to executing large-scale, application-specific projects. This pivot was a direct response to the massive new power demand (over 4 GW) created by South Korea’s national AI initiative and data center boom, which provided a clear commercial case for building dedicated clean power generation assets.

What is the Dangjin Green Energy Hub?
The Dangjin Green Energy Hub is KOEN’s flagship project in partnership with Samsung C&T. It is a $1.7 billion, 900 MW hydrogen fuel cell power plant specifically designed to provide stable, low-carbon power to an associated $860 million AI data center. It signifies KOEN’s shift to building high-value, demand-secured energy infrastructure.

Why did KOEN divest from the Shinan Ui offshore wind project?
KOEN exited the $2.1 billion Shinan Ui offshore wind project by selling its 37% stake because the project failed to pass a mandatory government feasibility study. This prompted a strategic decision to reallocate capital away from the stalled renewable project and toward more certain, large-scale hydrogen and gas infrastructure projects with secured demand, like the Dangjin hub.

What technology is KOEN focusing on to power AI data centers?
KOEN is focusing on commercial-scale hydrogen fuel cell power plants. The company has moved beyond research and development into building a 900 MW facility using this technology. Fuel cells were chosen because they offer high efficiency and the stable, 24/7 carbon-free power required by AI data centers, which cannot be met by intermittent renewable sources like wind or solar alone.

What are the biggest risks to KOEN’s new strategy?
The biggest risks are related to execution. KOEN’s success depends on its ability to navigate regulatory hurdles, secure financing, and successfully permit its large-scale projects. Specific risks include winning contracts under the Clean Hydrogen Portfolio Standard (CHPS) to ensure the Dangjin project’s viability and moving the 1.4 GW Incheon Offshore Wind project from an MoU to a final investment decision, as demonstrated by the failure of the Shinan Ui project.