Playing on concerns about the safety of nuclear power in the wake of Japan’s Fukushima disaster in 2011, South Korea’s Moon Jae-in promised during his successful presidential campaign to scrap or suspend new atomic plants.
Now that Moon is president, that anti-nuclear stance is seen as a threat to South Korea’s ambitions to become a bigger exporter of nuclear equipment and technology – a market valued at as much as USD740 billion over the next 10 years.
“If the new government withdraws its support for nuclear development in South Korea, this could send a negative signal to foreign countries looking to purchase reactors,” Kerry-Anne Shanks, a Singapore-based analyst at Wood Mackenzie Ltd., said by email. “An anti-nuclear stance could challenge Korea’s ambitions to export nuclear technology to other countries.”
The irony is that even as Moon turns his back on nuclear, South Korea has proven itself as one of only a few nations capable of successfully designing and starting up a nuclear reactor using the most advanced technology available.
South Korea, which has been building reactors since the 1970s, has been positioning itself as a potential successor to pioneers of the industry such as Westinghouse Electric Power Co. and Areva SA, which have become mired in cost overruns and construction delays.
Coming on the heels of Westinghouse’s bankruptcy, the political shifts in South Korea are further threatening the global industry and possibly narrowing the field of reactor builders. One South Korean firm, Kepco, said it would consider sponsoring a reorganization of Westinghouse if requested, according to a spokesman at the time.
South Korea has 25 nuclear reactors, which provide roughly a third of its energy needs, according to the World Nuclear Association. The Asian nation has the sixth-largest fleet of nuclear reactors in the world, accounting for about 23 gigawatts of capacity.
Besides the curbs on new nuclear facilities, Moon also campaigned to cancel any lifetime extensions for existing nuclear plants and to develop a roadmap to eventually rid the nation of atomic power altogether. In nuclear’s place, Moon would place greater emphasis on natural gas and renewables. On Monday, the new president ordered the shutdown for the month of June of 10 coal-fired power plants that have been operating for more than 30 years to cut pollution.
“If Korea stops building reactors domestically it will definitely hurt their export market,” said Jessica Lovering, director of energy at Breathrough Institute, an environmental think tank. “A big part of what makes Korea competitive in the global nuclear market is they have a thriving domestic industry with a proven track record of declining costs and reactors built on time.”
The global civil nuclear market is expected to be valued at $500 billion to $740 billion in the next 10 years, according to the U.S. Department of Commerce. An average of $80 billion a year will be needed in nuclear power investment through 2030 in order to meet a goal of keeping global temperature increases below 2 degrees Celsius by reducing carbon emissions from burning fossil-fuels, according to the International Atomic Energy Agency.
“Exporting nuclear power plants requires substantial up-front financial support from the vendor and its home government,” said Rod Adams, publisher of Atomic Insights, an industry news website. “There is already some evidence suggesting that the anti-nuclear stance of President Moon Jae-in will make it more difficult for South Korea to export nuclear reactors.”
One challenge to South Korea’s ambitions regardless of the election outcome is competition from other nuclear-exporting nations.
Russia and China, which have governments that provide financing for projects, have emerged as new leaders of the global nuclear industry. Russia has more than 20 nuclear reactors confirmed or planned for export, totaling $133 billion at the end of 2016, according to the WNA.
China is actively promoting export of its homegrown nuclear reactor, the Hualong One. China has signed deals with several nations, including the U.K., Argentina and Pakistan.
“The competitors being Russia and the upcoming Chinese offerings are challenging to South Korea, given the comparative limited footing of Korea from a global economic perspective,” Neil Todreas, a professor at the Massachusetts Institute of Technology, said by email. MDT/Bloomberg
White house visit penned for june
South Korean President Moon Jae-in will visit the White House next month for a summit with President Donald Trump amid worries over North Korea’s progress in building a nuclear and missile arsenal, Seoul’s presidential office said yesterday. The announcement came days after North Korea successfully tested a powerful new missile that analysts believe could reach Alaska when perfected. According to South Korean government officials, both countries have reaffirmed their common goal of the “complete discarding” of North Korean nuclear weapons and said they will pursue “all methods, including sanctions and dialogue” to reach this goal. The allies agreed that dialogue with North Korea could happen under the “right conditions,” said a South Korean government spokesperson.