Ahead of Trump’s Second Term Launch, 16-Year-Old US-Korea Nuclear Power Conflict Resolved [Why&Next]

Minister Anduk Geun of the Ministry of Trade, Industry and Energy signed an inter-agency agreement on the "Principles of Korea-U.S. Nuclear Power Export and Cooperation" with Jennifer Granholm, U.S. Secretary of Energy, and officials at the U.S. Department of Energy conference room in Washington D.C. on the 8th (local time). 2025.1.9. Provided by the Ministry of Trade, Industry and Energy Yonhap News Photo by Yonhap News

Following the signing of a nuclear power export and cooperation agreement (MOU) between the governments of South Korea and the United States, Korea Electric Power Corporation (KEPCO), Korea Hydro & Nuclear Power (KHNP), and the U.S. company Westinghouse have dramatically resolved their intellectual property disputes. Analysts interpret this as a result of aligned interests between the two countries ahead of the inauguration of the second Trump administration. Expectations are growing that nuclear cooperation between South Korea and the U.S. will intensify after the launch of the Trump administration's second term.

On the 16th (local time), KEPCO, KHNP, and Westinghouse officially announced the termination of their intellectual property dispute and agreed to strengthen cooperation in the global nuclear power market. Consequently, Westinghouse is expected to withdraw the lawsuit it had filed with the U.S. Federal Circuit Court of Appeals in Washington D.C. KHNP also stated it plans to withdraw its arbitration request filed with the Korean Commercial Arbitration Board.

As a result of the agreement, the green light has been given for the signing of the main contract for the construction of two Dukovany nuclear reactors in the Czech Republic, targeted by March. Upon learning of the dispute's resolution, the Czech side immediately welcomed the news. Czech Prime Minister Petr Fiala said on the social network X (formerly Twitter), "This settlement is good news for the Czech Republic," adding, "The resolution of negotiations between both parties will support the completion of the new Dukovany nuclear power plant and will be an opportunity for Czech industry." Czech Minister of Industry and Trade Luk?? B?lehr?dek also described it as "good news for the success of the Dukovany nuclear power plant construction project."

"Expectations for Nuclear Cooperation with the New U.S. Administration"

This resolution of the intellectual property dispute came just one week after South Korea and the U.S. signed an inter-agency MOU on nuclear export and cooperation principles on the 8th. At that time, both sides stated in a joint press release that "while strengthening export control management of civilian nuclear technology, the agreement provides a framework for bilateral cooperation to expand civilian nuclear power in third countries," raising expectations for nuclear cooperation between the two nations.

KEPCO, KHNP, and Westinghouse have not disclosed specific negotiation terms. Industry insiders understand that the Korean side proposed paying patent royalties to Westinghouse or allocating a portion of the work to them. There are also observations of regional balancing conditions, such as concessions in the Middle East and Europe, which could be interpreted as ceding some markets to the U.S. Nonetheless, the agreement is significant as it lays the foundation for resolving long-standing conflicts with the U.S. that had hindered progress and enables joint entry into new markets in the expanding nuclear sector.

Particularly notable is that the MOU and the resolution of the private dispute were achieved dramatically just before the end of the Joe Biden administration and the inauguration of the second Trump administration. A senior government official involved in the negotiations said, "The U.S. government was determined to responsibly conclude the negotiations until the end, which made the agreement possible," conveying the atmosphere.

Both South Korea and the U.S. faced the burden of having to restart discussions from scratch if the second Trump administration took office without resolving the conflict. This mutual concession enabled the dramatic settlement.

Expectations are rising as the upcoming second Trump administration is believed to have a strong commitment to expanding nuclear power. On the 15th, Chris Wright, the U.S. Department of Energy nominee, stated at a Senate confirmation hearing, "We will expand energy production, including commercial nuclear power and liquefied natural gas (LNG)." Wright also proposed small modular reactors (SMRs) as an alternative to large nuclear plants.

The South Korean government also expects nuclear cooperation between the two countries to expand following this agreement. A Ministry of Trade, Industry and Energy official said, "If South Korea and the U.S., both part of the free democratic camp, join hands, they can expand their market share against China and Russia in the global nuclear market," adding, "From the new administration's perspective, this agreement is not disadvantageous."

For the U.S., which has had little experience in new nuclear plant construction for a long time, partnering with Korean companies that have abundant experience in nuclear plant construction and operation is advantageous in competition. An Jeong-hye, head of the International Trade Team at law firm Yulchon (attorney), said, "Since the Trump administration is highly interested in nuclear power, cooperation between South Korea and the U.S. can be expected not only in the shipbuilding industry but also in the nuclear sector."

16-Year-Old Conflict

The seed of the conflict between South Korean and U.S. nuclear companies was sown 16 years ago. In 2009, KEPCO won the bid for the Barakah nuclear power plant in the United Arab Emirates (UAE), beating Westinghouse. At that time, Westinghouse raised issues, claiming that South Korea had infringed on its intellectual property rights.

Back then, the government and KEPCO, judging that domestic nuclear technology was somewhat lacking, recognized Westinghouse as a "technology provider." KEPCO reached an agreement to procure some components necessary for the construction of main equipment from Westinghouse. The amount Westinghouse received under the equipment supply contract was reportedly about $2 billion. Westinghouse also handled the export control procedures required for nuclear exports, which are subject to U.S. government export controls.

As domestic nuclear technology localization progressed, South Korea independently pursued new nuclear power plant orders in countries like the Czech Republic and Poland. However, in October 2022, Westinghouse filed a lawsuit in the U.S. Federal District Court in Washington D.C., claiming that the Korean-designed APR1400 reactor, which KHNP intended to export, was developed based on its technology and sought to prevent exports without U.S. government approval.

Overview of the Dukovany Nuclear Power Plant in Czech Republic. Provided by Korea Hydro & Nuclear Power Co., Ltd. Yonhap News Agency

However, in September 2023, the U.S. court dismissed the case, ruling that export control enforcement authority lies with the U.S. government, and Westinghouse, as a private company, could not be the subject of the lawsuit. Westinghouse appealed the decision. In July last year, when KHNP was selected as the preferred bidder for the new Dukovany nuclear power plant, Westinghouse also filed objections with the Czech antitrust authorities.

KHNP argued that the APR1400 was an independently developed model and thus not subject to U.S. export controls. When Westinghouse filed the lawsuit in its domestic court, KHNP also filed international arbitration with the Korean Commercial Arbitration Board in October 2022, requesting a ruling that the APR1400 does not include Westinghouse's technology. The arbitration result was expected by the end of this year.

However, with KEPCO, KHNP, and Westinghouse agreeing to end the intellectual property dispute, all litigation and arbitration procedures proposed by both sides have now been terminated.

The Beginning and End of the Conflict: 'System 80'

The reactor that KEPCO exported to the UAE Barakah plant is the APR1400, known as the Korean-type reactor. The reactor to be supplied for the Czech Dukovany plant is a reduced-capacity version called the APR1000. Westinghouse claimed that both reactors infringed on the intellectual property rights of its 'System 80.'

South Korea began localizing pressurized water reactors by partnering with the U.S. company Combustion Engineering (CE) for technology transfer when constructing Yeonggwang Units 3 and 4 in 1987. The reactor developed by CE was the System 80. Subsequent reactors such as Uljin Units 3 and 4, Yeonggwang Units 5 and 6, Uljin Units 5 and 6, Shin-Kori Units 1 and 2, and Shin-Wolsong Units 1 and 2 were all built through technology transfer from CE. These were called the Korean Standard Nuclear Power Plant (OPR1400).

CE was later acquired by the European company ABB, becoming ABB-CE, which was then acquired by Westinghouse. The intellectual property rights of CE's System 80 were also transferred to Westinghouse. In 2022, Westinghouse was acquired by a consortium of the private equity firm Brookfield and Canadian nuclear fuel company Cameco. Brookfield holds 51% and Cameco 49% of the shares.

South Korea pursued nuclear localization to eliminate patent disputes and enhance international competitiveness, developing the APR1400, a reactor design different from the previous model. The APR1400 was applied starting with Shin-Kori Units 3 and 4 and was first exported to the UAE. An industry insider said, "Since the APR1400 was also based on the System 80 design, it likely was not completely free from Westinghouse's patents."

The resolution of this dispute is also significant in that it removes the long-standing label of "intellectual property infringement controversy" that had accompanied localization efforts.

This content was produced with the assistance of AI translation services.