News / Asia

Stung by Scandal, S. Korea Weighs Costs of Curbing Nuclear Power

FILE - An employee of the Korea Power Exchange, a state company to check the country's flow of electricity, watches a huge screen monitoring power supply during power outages in Seoul, September 15, 2011.
FILE - An employee of the Korea Power Exchange, a state company to check the country's flow of electricity, watches a huge screen monitoring power supply during power outages in Seoul, September 15, 2011.
Reuters
It started with a few bogus safety certificates for cables shutting a handful of South Korean nuclear reactors. Now, the scandal has snowballed, with 100 people indicted and Seoul under pressure to rethink its reliance on nuclear power.
 
A shift away from nuclear, which generates a third of South Korea's electricity, could cost tens of billions of dollars a year by boosting imports of liquefied natural gas, oil or coal.
 
Although helping calm safety concerns, it would also push the government into a politically sensitive debate over whether state utilities could pass on sharply higher power bills to households and companies.
 
Gas, which makes up half of South Korea's energy bill while accounting for only a fifth of its power, would likely be the main substitute for nuclear, as it is considered cleaner than coal and plants can be built more easily near cities.
 
“If the proportion of nuclear power is cut, other fuel-based power generation has to be raised. If we use LNG, the cost will definitely go up,” said Hwang Woo-hyun, vice president of state-run utility Korea Electric Power Corp (KEPCO).
 
KEPCO owns Korea Hydro and Nuclear Power Co Ltd, which operates the county's nuclear reactors, and also has a quarter stake in Korea Gas Corp (KOGAS), the world's largest corporate buyer of LNG.
 
The extra cost to Asia's fourth-largest economy of importing more LNG to replace nuclear could be approaching $20 billion per year by 2035, according to Reuters calculations based on government projections for power capacity growth and South Korea's average LNG prices for last year.
 
South Korea could need as much as 25 million extra tons by 2035 if a proposal to reduce nuclear's share of its energy mix is drafted into power policy.
 
The cost projection could be conservative if rising demand from South Korea fuels further price rises in LNG. Top LNG importer Japan is also buying more gas than ever as it compensates for its own nuclear shutdown in the wake of the Fukushima disaster.
 
Offline, Reduction Recommended
 
Three of South Korea's 23 reactors are offline due to the fake safety certificates, while another will be shut on Oct. 30 to examine welding quality related to the safety of a steam generator.
 
Two others are also out for regular maintenance and a sixth one is shut, awaiting an extension of its 30-year life span. Of six reactors under construction, three have been delayed from start-up, also because of safety issues.
 
Authorities have indicted 100 people, including a former top state utility official, for corruption after the discovery of the fake safety certificates.
 
The chaos in the industry comes as a government working group recommended on Oct. 13 a cut in South Korea's reliance on nuclear power, pointing to a drop in public confidence in safety that has been exacerbated by Japan's Fukushima disaster.
 
The study recommended nuclear power capacity be kept between 22 and 29 percent of the total by 2035, well below existing plans to grow the sector to 41 percent in less than 20 years.
 
The government will hold public hearings to decide whether to back the recommendation before finalizing its energy policy in December.
 
As of 2012, nuclear accounted for 26 percent of total generating capacity, according to energy ministry data, though it typically accounts for about a third of power generation, while only making up about 3-4 percent of energy costs.
 
Coal made up about 31 percent and LNG 26 percent of the country's total power generation capacity last year.
 
Fuel costs for power at the end of August, were 48 won ($0.05) per kilowatt-hour (kwh) for nuclear, 64 won/kwh for coal, 166 won/kwh for LNG and 226 won/kwh for oil, according to KEPCO.
 
Cost Dilemma
 
Gas demand by South Korea has already been rising to make up for its nuclear power shortfall.
 
South Korea's LNG imports rose 12 percent from a year ago to 29.5 million tons in the first nine months of this year. Last year it imported 36.3 million tons of LNG.
 
Shares of KOGAS hit their highest in more than five months at 66,700 won on Oct. 16, reflecting expectations of higher gas demand if the recommendation for less nuclear power is taken up.
 
Plugging the nuclear shortfall with imports of fossil fuels could raise local electricity fares up to five-fold by 2030, according to local media.
 
The energy ministry has ruled out large electricity tariff hikes, however, saying low-cost nuclear generation will continue to contribute a large portion of total power supply even with a drop in its share of the capacity mix.
 
South Korea's utilities, meanwhile, are banking on consumers using less electricity if prices rise and on what they hope will be cheaper North American gas supplies later this decade.
 
A KEPCO official who asked not to be identified said the firm expected to receive cheap shale gas from 2017.
 
Before then, however, fuel costs could rise if nuclear power is replaced with higher cost fuels like gas, he said.

You May Like

VOA Exclusive: Interview With Myanmar President Thein Sein

Thein Sein calls allegations that minority Muslim Rohingya are fleeing alleged torture in Rakhine state a media fabrication More

Video Better Protective Suit Sought for Ebola Caregivers

Current suit is uncomfortable, requires too many steps for removal, increasing chance of deadly contact with virus More

UN Rights Commission Investigates Eritrea

Three-member commission will start collecting first-hand information from victims and other witnesses in Switzerland and Italy next week More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Ebola Economic Toll Stirs W. Africa Food Security Concernsi
X
November 19, 2014 11:39 PM
The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Ebola Economic Toll Stirs W. Africa Food Security Concerns

The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Mexico Protests Escalate Over Disappearances

Protests in Mexico over 43 students missing since September continue to escalate, reflecting growing anger among Mexicans about a political system they view as corrupt, and increasingly tainted by the drug trade. Mounting outrage over the disappearances is now focused on the government of President Enrique Pena Nieto, accused of not doing enough to end insecurity in the country. More from VOA's Victoria Macchi.
Video

Video US Senate Votes Down Controversial Oil Pipeline - For Now

The U.S. Senate has rejected construction of a controversial pipeline to transport Canadian oil to American refineries. The $5 billion project still could be approved next year, but it faces a possible veto by President Barack Obama. As VOA’s Michael Bowman reports, the pipeline has exposed deep divisions in Congress about America’s energy future.
Video

Video Can Minsk Cease-fire Agreement Hold?

Growing tensions between government troops and separatists in eastern Ukraine further threaten a cease-fire agreement reached two months ago in the Belarusian capital of Minsk. Critics of U.S. policy in Ukraine say it is time the Obama administration gives up on that much-violated cease-fire and moves toward a new deal with Russia. VOA's Scott Stearns has more.
Video

Video Chaos, Abuse Defy Solution in Libya

The political and security crisis in Libya is deepening, with competing governments and, according to Amnesty International, widespread human rights violations committed with impunity. VOA’s Al Pessin reports from London.
Video

Video US Hosts Record 866,000 Foreign Students

Close to 900,000 international students are studying at American universities and colleges, more than ever before. About half of them come from Asia, mostly China. The United States hosts more foreign students than any other country in the world, and its foreign student population is steadily growing. Zlatica Hoke reports.
Video

Video Ferguson Church Grapples with Race Relations

Many white residents of Ferguson, Missouri, say they chose to live there because of the American Midwest community's diversity. So, they were shocked when a white police officer killed an unarmed black teenager in August – and shaken by the resulting protests and violence. Some local churches are leading conversations on how to go forward. VOA’s Ayesha Tanzeem reports.
Video

Video What Jon Stewart Learned About Iran From 'Rosewater'

Jon Stewart, host of the satirical news program "The Daily Show" talks with Saman Arbabi of Voice of America's Persian service about Stewart's directorial debut, "Rosewater."
Video

Video Lebanese Winemakers Thrive Despite War Next Door

In some of the most volatile parts of Lebanon, where a constant flow of refugees crosses the border from Syria, one industry continues to flourish against the odds. Lebanese winemakers say after surviving a brutal civil war in the 1970s and 80s, they can survive anything. Heather Murdock has more for VOA from the Bekaa Valley in Lebanon.
Video

Video China's Rise Closely Watched

China’s role as APEC host this week allowed a rare opportunity for Beijing to showcase its vision for the global economy and the region. But as China’s stature grows, so have tensions with other countries, including the United States. VOA’s Bill Ide in Beijing reports on how China’s rise as a global power is seen among Chinese and Americans.

All About America

AppleAndroid