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| Title | Daesung Group Designated as Community Energy System (CES) Partner for Suwan, Gwangju | 2006.01.13 |
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FROM: Daesung Group Designated as Community Energy System (CES) Partner for Suwan, Gwangju Daesung Group (CEO & Chairman, David Young-hoon Kim) announced today that the company has been designated the partner for Suwan, Gwangju's Community Energy System (CES). Daesung Group will be entering into a memorandum of understanding (MOU) with Gwangju City and the Korea District Heating Corp today. This project represents the largest Community Energy System (CES) construction project in Korea and will be carried by a consortium of private enterprise, Daesung Group; a publically owned company, the Korea District Heating Corp.; and a local autonomous entity, Gwangju City. The Military Mutual Aid Association is also planning to invest in the consortium as well. Daesung will invest 35%, the Korea District Heating Corp 34% and Gwangju City will invest 1% of the equity. The consortium will invest a total of 180 billion won and upon completion, Daesung Group will directly manage the facility under the auspices of a newly-formed corporation. The Suwan-Hanam 2 Area in the city of Gwangju will become a housing development with 32,500 households. Construction is expected to be completed by 2008. According to a recent study, this area was ranked as being one of the most desirable living areas in Gwangju. The biggest benefit of the CES project is that electricity and heat are produced simultaneously. More specifically, with this project it will be possible to utilize heating energy that is produced by electricity as the source for home heating. In the Suwan-Hanam 2 Area 35 billion KW worth of energy is expected to be saved every year, thus preventing the emission of 46,000 tons of greenhouse gas. This project is drawing wide attention in that it is the biggest CES project ever carried in Korea and because it is a model case of private-public partnership in the field of energy in which a private corporation, a public coporation and a local government work together to establish a consortium. It also is considered to be a Win-Win model for all participants because it links the best technologies and know-how each participant has for the project. Most experts see the profitability of the project in positive terms because it is big enough to both fulfill the economies of scale and because the houses and buildings in the area will be in close proximinity, meaning lower costs for the pipeline and other facilities. In relation to CES, Daesung Group has accumulated technology and know-how since the company was designated the builder and operator of Juk-kok CES in Daegu City, Korea. With the acquisition of the management rights for Suwan-Hanam 2 CES project, Daesung's leading position in the renewable and alternative energy field will be enhanced. In spite of the usual discord between Korea District Heating Corporation (KDHC) and natural gas distributors, the cooperative relationship between Daesung and KDHC in this project can be a turning point for reconciliation and further cooperation. |
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