North Korea swaps rare earth metals with China, for solar power

Plans are underway for the Chinese Government to build a $2.5 billion solar plant near Pyongyang, North Korea, expected to deliver up to 2.5 GW of solar energy capacity.

In an announcement last week, the Association of China Rare Earth Industry look set to build a solar park to help alleviate electricity shortages in North Korea, in exchange for mining rights in the northern part of the Pyongyang province. With 2019 marking the 70th anniversary of the diplomatic relations between the two countries, the collaboration between the nations in this project is perhaps less unexpected that it initially appears.

Despite its history of secrecy, North Korea has been unable to hide its power struggles. Satellite footage of the country can often show a vast region of darkness, with just a few glows dotted about the nation. According to the International Energy Agency, only 26% of the population had access to electricity in 2016 and no real signs of change have been seen since then.

This electricity shortage has been in part due to extreme conditions preventing hydroelectricity from reaching its potential in the country, with 2015 droughts causing the 13 TWh of annual production to fall to just 10 TWh. As the cost of coal has risen, North Korea has been forced to turn away from its domestic resources and import petroleum products from Russia and China, although volumes have been limited by UN imposed sanctions, following the country’s ballistic missile tests in 2016.

In June, Leader Kim Jong-un called upon his nation to promote renewables as part of a drive to become self-sufficient in terms of energy, with only a small amount of solar already installed in the country. Looking to China may well be a sign of desperation, at a time when the country is aiming for energy independence, but struggling to keep its lights on.

China in contrast has the world’s largest market for photovoltaics, with nearly 200 GW of installed capacity and a wealth of advanced manufacturers who are more than capable of delivering such a project to the countries north-east neighbor.

In return, China will want access to mining rights for the rare earth mine just beyond the border between the countries in North Pyongan Province. As the world’s dominating producer of rare earth minerals, often used in consumer electronics and military equipment, China will aim to build on production volume through the relatively untapped mine in North Korea.