The basic plan for electricity supply for the period of 2020 to 2034, which was fixed by the government earlier this week, is flawed in many respects. It turns a blind eye to economic efficiency, contradicts the carbon neutrality goal and runs the risk of disrupting a stable supply of electricity.
What has made the plan so flawed is the ill-conceived policy pursued obstinately by President Moon Jae-in’s administration to phase out nuclear power generation in South Korea. The latest blueprint for the nation’s energy mix calls for reducing the number of nuclear power plants from the current 24 to 17 by 2034. Accordingly, nuclear power is set to decrease in proportion to Korea’s overall electricity generation capacity from 25.6 percent to 10.4 percent over the cited period.
Renewable energy and liquefied natural gas will account for 41.9 percent and 31.8 percent, respectively, in 2034, up from 6.5 percent and 25.9 percent in 2020. Coal-fired power generation is planned to drop from 40.4 percent to 15.6 percent during the same period.
The respective costs of producing electricity from LNG and renewables, such as solar panels and wind turbines, were approximately three and four times higher than that for nuclear power generation last year, according to a study by the National Assembly Budget Office.
It is estimated to cost about 100 trillion won ($92 billion) to expand solar and wind power generation for the coming 15 years as planned by the government. The same amount of electricity could be produced by building six new nuclear power plants at the cost of around 30 trillion won or spending around 11 trillion won to extend the lifespan of the 11 existing nuclear power plants set to be decommissioned by 2034.
It will also be more cost-effective to make up for a cut in coal-fired electricity generation with nuclear power than LNG.
The Moon government’s push to replace nuclear power with renewable energy and LNG since it assumed office in 2017 has driven the Korea Electric Power Corp., the state-run electricity provider, into financial difficulties. The company, which recorded an operating profit of 12 trillion won in 2016, suffered a loss of 1 trillion won last year, with its outstanding debt growing from 104 trillion won to 128.7 trillion won over the cited period.
Kepco plans to change its billing system next year in a move critics see as designed to put the burden of the misplaced energy policy on the shoulders of consumers. A rise in electricity prices will not only increase financial burdens on households struggling to make ends meet, but also weaken the international competitiveness of local manufacturing firms.
The nuclear phaseout drive also contradicts the Moon administration’s pledge to achieve carbon neutrality by 2050. It will be virtually impossible for Korea to reduce carbon emissions to net-zero by the target year if it increases LNG-fueled power generation to make up for a reduction in nuclear energy, which emits no greenhouse gases. It should be noted that major countries, including China and Japan, are pushing to build more nuclear power plants to reach net-zero carbon emissions.
The latest basic scheme for electricity supply assumes that Korea’s electric power consumption will increase by an annual average of 0.6 percent for 15 years through 2034. But many experts predict the country will see its electricity consumption rise at a faster pace in keeping with what is known as the “fourth industrial revolution,” featuring artificial intelligence, autonomous vehicles, big data marketing and other high-tech sectors. Demand for electricity could go up by up to three times by 2050, if the goal of carbon neutrality is to be achieved by then as Moon has pledged.
Moreover, the efficiency and stability of electricity generation by renewables fall far short of what can be warranted by nuclear power.
The Moon administration’s adherence to the nuclear phaseout policy is also threatening to demolish the foundation of the country’s nuclear power industry, which has established top-class competitiveness on the world stage over the past decades.
The nonsensical plan for electricity supply is likely to -- or should -- be discarded by the next administration when it is subject to a biennial review after Moon leaves office in May 2022. Still, it is deplorable that the country will have to pay the unnecessary price of senseless efforts to break off from the stable source of cheaper and cleaner energy during his five-year tenure.