Shinhan Bank plans to sharply raise the share of renewable energy at a data center it is building in the Seoul metropolitan area, where power supply constraints have been holding up such projects. The bank aims to lift renewables to about 50% of total contracted power capacity at an artificial intelligence data center planned for Namyangju, Gyeonggi Province. The strategy is designed to meet government review standards, and it is drawing attention as a possible answer to the power shortage facing data centers around the capital.
Shinhan Bank submitted a plan to the Ministry of Climate, Energy and Environment setting renewables at 50% for the AI data center it is developing in the Wangsuk urban high-tech industrial complex in Namyangju, according to industry sources on the 21st. That contrasts with Kakao (035720) and Woori Bank (000030), which are also building data centers in the same complex and proposed renewable shares of 3.37% and 2.04%, respectively.
The AI data center planned by Shinhan Bank has a contracted power capacity of 50 megawatts. The bank intends to reduce its reliance on the external grid by installing solar generation, air-source and geothermal heat pumps, and equipment to recover waste heat from the data center.
The plan is seen as a step toward clearing the grid impact assessment, a major hurdle for data center construction in the metropolitan area. Kakao and Woori Bank passed the assessment last year, but Shinhan Bank cleared the first technical review by Korea Electric Power Corp. and still failed the ministry's main evaluation. The bank is awaiting a second review, though no specific schedule has been set.
The share of renewable energy is one of the main criteria in the grid impact assessment. Under current standards, a project can receive full marks on that item if renewables account for 50% or more.
The key question is how much the renewable facilities can actually cut dependence on the grid. An AI data center consumes large amounts of electricity around the clock, so a stable supply is essential. Solar power, however, cannot generate at night, and output varies with weather conditions. Air-source and geothermal heat pumps and waste heat recovery equipment also play a supporting role in cutting energy consumption rather than generating electricity directly.
"Solar and wind output fluctuates with the time of day and weather conditions, so an AI data center that runs 24 hours a day needs energy storage systems, grid expansion and a stable supply of low-carbon power alongside them," said Cho Young-im, a professor of computer engineering at Gachon University. "The International Energy Agency also finds that a mix of different power sources is needed to meet rising electricity demand from data centers."
In response, Shinhan Bank has built energy storage systems equal to 10% into its power procurement plan to smooth out imbalances in supply across the day. Energy produced during daylight hours would be stored and used at night, with any shortfall supplied by Korea Electric Power Corp. "We plan to store energy generated during the day in the ESS for use at night and to receive any shortfall from KEPCO," a Shinhan Bank official said. "The 50 megawatts is the maximum contracted capacity by design, and it is unlikely that all of it will be used in actual operation."
Behind the bank's push for the Wangsuk complex project is the need to secure a data center within the metropolitan area. The AI data center is designed as an "active-active" setup, running the main computing center and the disaster recovery center at the same time. The two centers synchronize data in real time, and if one fails, the other carries out the same operations. Given the need for rapid recovery and the travel time for response staff, the bank judged it more efficient to build the new facility in the capital region, close to its existing computing centers.
The remaining variables are tighter government review standards and negotiations with the city of Namyangju. In July, the ministry gave public notice of a proposed rule on the operation of the grid impact assessment system that would raise the passing score for data centers in the metropolitan area to 75 from 70. If the new rule takes effect while the review is delayed, Shinhan Bank could face a tougher evaluation.
Namyangju is also renegotiating public contribution arrangements with data center developers including Shinhan Bank and Kakao, following the start of a new elected mayor's administration. "We are in continuing talks with the companies on public contributions and other matters, and measures that improve on the original plans are under discussion," a Namyangju city official said.