"No Time for 'Daltalwonjeon'... Industry's Desperate Plea"

[Image source=Yonhap News]

원본보기 아이콘

[Asia Economy Reporter Moon Chaeseok] Although the possibility of the Yoon Seok-yeol administration abandoning its nuclear phase-out policy has been raised, the nuclear power industry has unanimously stated that it is not a situation to be reassured about. While the possibility of resuming construction of Shin Hanul Units 3 and 4 is being discussed, it is expected that new work orders will only come in 2 to 3 years later, so the atmosphere is that they must secure maintenance and repair work orders for existing nuclear power plants in the meantime.

According to the nuclear industry on the 24th, the number of new nuclear power-related contracts for Doosan Enerbility (formerly Doosan Heavy Industries & Construction) 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 respondents from nuclear supply companies and public research institutions answered that their 2024 sales would maintain or decrease compared to 2019 levels. That is roughly three out of four.

The industry is currently striving to secure as many maintenance and repair work orders as possible for existing nuclear power plants until work orders increase after the resumption of Shin Hanul Units 3 and 4 construction. They must quickly supply essential routine maintenance items such as control rods to subsidiaries of Korea Electric Power Corporation or Doosan Enerbility, but the industry explains that it is difficult to endure with a 'zero' operation rate. They said there are many challenges to solve, including the commercialization of Small Modular Reactors (SMRs), skilled worker attrition, and securing work orders related to the resumption of nuclear power plant construction.

The CEO of Company A, a control rod manufacturer for nuclear power plants in Busan, said, "After delivering parts for Shin Kori Units 5 and 6 one and a half years ahead of schedule in June last year, the factory's operation rate has been 'zero' for 10 months," and pointed out, "If Korea Hydro & Nuclear Power, which is responsible for managing the national energy supply chain, supports companies with about 1 to 2 billion KRW annually during the bidding process, it could revive the industrial ecosystem." The director of Company B, a routine maintenance manufacturer in Changwon, Gyeongsangnam-do, said, "The most urgent thing is volume (work orders). Only with volume can we replenish manpower and repay 1 billion KRW in bank loans." He added, "Although the political sphere says they will resume construction of Shin Hanul Units 3 and 4, private companies can only prepare bids once the Ministry of Trade, Industry and Energy and Korea Hydro & Nuclear Power actually proceed with procedures such as site approval. Even if construction resumes immediately, the time when the Changwon manufacturing plant receives work orders is expected to be two years later, so we have to endure without volume until then."

There are also concerns about confusion in the political sphere and delays in policy discussions. Even if construction of Shin Hanul Units 3 and 4 resumes due to environmental impact assessments by the Ministry of Environment, it is feared that it will take considerable time to recover sales. An 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 approving authority has consulted with the Minister of Environment, the request for re-consultation can be omitted." He added, "It is urgent to fully utilize such provisions to drastically reduce licensing procedures and promptly support companies' efforts to secure work orders."

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.