Published : 2013-10-15 19:25
Updated : 2013-10-15 19:25
The government is pushing for an overhaul of energy policy to reduce the nation’s reliance on nuclear power and curb energy consumption.
A joint working group consisting of some 60 experts from the public and private sectors has sketched out a new energy policy vision for the government, which differs sharply from that pursued by the preceding administration.
President Lee Myung-bak envisioned a “nuclear renaissance” as he regarded nuclear power as the answer to a set of policy challenges ― climate change, rising energy demand and reliance on overseas oil and gas. He also sought to tap the domestic nuclear industry’s potential to become a promising export business.
Lee had his vision fleshed out in the National Energy Basic Plan for 2008-2030, the nation’s first long-term energy policy guideline. The 20-year plan was supposed to be updated every five years.
The joint working group has authored an update, which covers 2013-2035. While the first plan called for expanding the share of nuclear power in the nation’s electricity production capacity from 26 percent in 2007 to 41 percent in 2030, the new version recommends it be maintained in the 22-29 percent range.
The recommendation, if accepted by the government, will put the brakes on the nuclear power expansion pursued by the previous administration. The policy shift is understandable, given the weakened support for nuclear power among Koreans following Fukushima and the revelations that substandard parts have been widely used in reactors.
More recently, the difficulty of constructing new reactors has been highlighted by the clashes between residents of Miryang, South Gyeongsang Province, and Korea Electric Power Corp. over the erection of high-voltage transmission towers to deliver electricity from a nuclear power plant on the east coast to other parts of the nation.
The problem with the recommendation, however, is that it will inevitably cause electricity prices to rise. If reliance on nuclear power is reduced, other energy sources, such as fossil fuels and renewables, have to make up the shortfall. In light of its environment-friendliness, liquefied natural gas is expected to pick up most of the slack.
But this will ratchet up electricity prices, as LNG is about three times more expensive than nuclear power as an energy source. The Korea Energy Economics Institute forecasts that power prices would soar to three to five times the current level over the next 20 years.
So the working group recommends that the government shift the focus of its energy policy from generating more power to curbing electricity demand. This is a step in the right direction. Yet if experience is any guide, demand management cannot succeed without cooperation from households and corporations.
Before approving the group’s proposals, the government needs to level with consumers about the expected hike in electricity prices. Many would welcome the proposed shift away from nuclear power. But they could think twice if they realized that electricity prices would increase more than 10 percent each year for the next two decades.
As power prices affect the cost of producing goods and services, the government should also talk with corporations.
The focus on demand management also risks underestimating future increases in power demand. One reason the nation undergoes power shortages every year is that the Roh Moo-hyun government failed to read the trend in electricity consumption correctly and put off the construction of new power plants. This kind of mistake should not be repeated.