Government to Boost Nuclear Power, Expand Coal if Needed
The government has decided to accelerate the restart of nuclear reactors, including Shin Wolsung Unit 1, to prevent global energy price surges triggered by the Iran crisis from pressuring domestic electricity rate hikes. If necessary, coal power generation will also be expanded.
On the 11th, Kim Sung-whan, Minister of Climate, Energy and Environment, held an energy countermeasures meeting to assess the impact of soaring international energy prices following U.S.-Israel airstrikes on Iran and push for immediate responses such as nuclear reactor restarts. With nuclear power having the lowest generation cost at 66 Korean won per kWh (kilowatt-hour) among all energy sources, the plan is to increase nuclear utilization rates. This approach aims to reduce consumption of costlier LNG (liquefied natural gas).
Within this month, Shin Wolsung Unit 1 and Kori-2 nuclear reactor, currently under maintenance, will be restarted. Four additional reactors—Hanbit Unit 6, Hanul Unit 3, and Wolsung Units 2 and 3—are scheduled to resume operations by mid-May. The combined capacity of these six reactors is 5.05 GW (gigawatts), equivalent to replacing 10 LNG combined cycle power generators of 500 MW (megawatts) each.
Coal power plants will be operated flexibly depending on circumstances. The ministry currently limits coal generator output to 80% on weekdays and halts some units on weekends under the fine dust seasonal management system. However, restrictions will be lifted if LNG supply issues arise.
The swift response stems from the trauma of KEPCO’s over 200 trillion won debt. In 2022, international oil and natural gas prices surged due to Russia’s invasion of Ukraine, sharply raising domestic generation costs. However, electricity rates were not adjusted in time, leading to reverse margins and massive debt for KEPCO.
Energy prices remain unstable amid Middle East tensions. Dubai crude, a benchmark for Asian oil prices, jumped from $71.24 (104,900 Korean won) per barrel on February 27, just before the airstrikes, to $125 on the 9th, and is now trading around $105. The JKM (Japan Korea Marker), a spot price indicator for Northeast Asian LNG, also rose by about 50% during the same period.