Industry: "Many Obstacles Until Construction Resumes... Urgent Need to Secure Work"[Nuclear Power Ecosystem Restoration Strategy③]

President-elect Yoon Suk-yeol visiting the site of the halted construction of Shin Hanul Units 3 and 4 in Uljin County, Gyeongsangbuk-do, on December 29 last year when he was the People Power Party candidate. At the time, President-elect Yoon announced nuclear energy pledges, including a full review of the nuclear phase-out policy and the immediate resumption of construction of Shin Hanul Units 3 and 4. (Image source=Yonhap News)

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[Asia Economy Reporter Moon Chaeseok]

"'De-nuclear phase-out' is not a health supplement but an oxygen respirator. Without it, everyone dies." (CEO of Company A, a control rod manufacturer at a nuclear power plant in Busan)

"I don't believe the next government's pro-nuclear stance will be as strong as that of the 'Park Geun-hye administration's pro-nuclear' level. Just because it's 'endemic' (periodic outbreak of infectious diseases) doesn't mean 'COVID-19 is over,' does it?" (Director of Company B, a nuclear power maintenance manufacturer in Changwon, Gyeongsangnam-do)

As the possibility of resuming construction of Shin Hanul Units 3 and 4, which had been halted under the Moon Jae-in administration, increases, the nuclear industry unanimously agrees that it is not a situation to be relieved about. There are many hurdles to overcome before construction can resume, and concerns remain that the work shortage will continue for 2 to 3 years.

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According to the nuclear industry on the 19th, the number of new nuclear-related contracts for Doosan Enerbility (formerly Doosan Heavy Industries) dropped by half from 2,786 in 2016 to 1,172 in 2020. During the same period, the number of contracted partner companies sharply decreased from 320 to 227. According to the "Nuclear Industry Status Survey" conducted by the Korea Nuclear Industry Association on 332 organizations, 75.3% of nuclear supply companies and public research institutions responded that their 2024 sales would either maintain or decline compared to 2019 levels.

The industry expects that even if construction of Shin Hanul Units 3 and 4 resumes, work volume will only increase 2 to 3 years later, so they are fighting desperately to secure maintenance and repair work for existing nuclear plants. In fact, the industry explains that it is difficult to sustain operations with a 'zero' utilization rate, even for essential supply chain items such as routine maintenance and control rods, which must be delivered quickly to Korea Electric Power Corporation’s power subsidiaries or Doosan Enerbility. An industry insider said, "Securing work is the most urgent issue, while commercialization of small modular reactors (SMRs) and skilled worker attrition are problems for later."

CEO A said, "Since delivering parts for Shin Kori Units 5 and 6 one and a half years ahead of schedule in June last year, the factory utilization rate has been 'zero' for 10 months," and pointed out, "If Korea Hydro & Nuclear Power, which is responsible for the national energy supply chain, manages the essential technologies and supports companies with about 1 to 2 billion KRW annually during the bidding process, the industrial ecosystem can be revived."

Director B said, "Although the political sphere says construction of Shin Hanul Units 3 and 4 will resume, the Ministry of Trade, Industry and Energy and KHNP must actually proceed with procedures such as site approval for private companies to prepare bids," and confessed, "Even if construction resumes immediately, the manufacturing plants in Changwon are expected to receive orders two years later, so they have to endure without orders until then."

Many also express frustration over political confusion and delays in policy discussions. In particular, concerns are raised that even if construction of Shin Hanul Units 3 and 4 resumes due to environmental impact assessments by the Ministry of Environment, it will take considerable time to recover sales.

Another industry official said, "Article 32, Paragraph 1, Subparagraph 1 of the Environmental Impact Assessment Act stipulates that if the surrounding conditions have changed only slightly during the period when the project has not started, and the approval authority has consulted with the Minister of Environment, the request for re-consultation can be omitted," and added, "It is urgent to fully utilize such provisions to drastically reduce licensing procedures and promptly support companies' efforts to secure work."

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