05.11.2017 Author: Konstantin Asmolov

The Problems of Moon Jae-in’s Energy Policy

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Not so long ago, we talked about the great purge of Moon Jae-in instigated to strengthen his political position. Without this, many of his projects, especially populistic initiatives, risk being buried, not unlike the similar ideas of his predecessors.

In this context, let us consider the course of the new President of the Republic of Korea on stepping back from nuclear energy. Even as a candidate, he dwelled on radiophobia and “due to environmental considerations, while also taking into account the protests of local residents,” proposed the cancellation of the construction of new nuclear power plants, including the fifth and sixth power units of the Singori nuclear power plant and the closure of the reactor “Wolson-1.” Instead, he deemed it necessary to develop eco-friendly renewable energy sources.

On 19 June 2017, the first domestic nuclear power plant, Kori-1, was shut down. On 27 June, the Cabinet of Ministers decided to suspend the construction of the power units of the Singori nuclear power plant, which by that time were ready at 29.5%. At the same time (since concerns arose immediately regarding the expected damage from the project closure), it was proposed to ​​create a commission to study public opinion and form a working group to come up with a solution.

On 24 July 2017, there was created a commission of nine people aimed at studying public opinion on the construction of the fifth and sixth power units of the Singori NPP. It was decided not to include energy specialists as the new government demonstrates concern for the people, not simply economic efficiency! The commission consists of two experts from the humanitarian, public, scientific and technological and statistical spheres, two conflict researchers and the former head of the Supreme Court Justice Kim Ji-hyeon. Also, to demonstrate gender equality and balance among experts, the commission also included three women and three representatives under the age of forty.

The Commission was expected to conduct polls, organize public hearings and debates and form a working group that would reach a final conclusion on the construction of new facilities of the Singori NPP by 21 October. Additionally, the people’s approval was a necessity.

As Park Yeong-gyu, the new Minister of Industry, Trade and Energy of South Korea, announced at the inauguration ceremony, “the time has come for joining the global trend of abandoning nuclear power plants and coal as sources of energy in favor of the development of renewable energy sources.” The new minister particularly stressed that comparing the cost-efficiency of nuclear power plants and renewable energy sources based on current technologies is a short-sighted approach that does not take into account the technological possibilities of the future.

Critics immediately noted that the termination of the construction of new NPPs is a complex problem, since a large number of contractors and workers were already involved in the implementation of the projects. Almost USD 1.5 billion have already been spent, and in the event of a final cessation of construction, losses would amount to USD 2 billion 320 million. Then, the termination of the construction of new power units would further exacerbate the problems with the energy supply, and, as a result, electricity prices would grow.

Until a certain time, there was no information about the activities of the commission, but on 20 October, its decision was announced—and not in Moon’s favor. It was based on the results of a survey of 471 specially selected experts, of which 59.5% supported the renewal of construction, and 40.5% called for its complete cessation. According to South Korean media, there were initially five hundred experts and the survey was conducted four times, but from the very start, most of the commission members were inclined to support the resumption of building reactors. With each poll, the proponents of this position increased in number. In addition, the commission’s decision was influenced by the opinion of local residents and entrepreneurs who actively opposed the suspension of construction and demanded financial compensation. Instead of freezing current projects, it would be more logical for the government to shut down older reactors, especially those built more than 30 years ago.

The medicine was swallowed. “The administration of the President of the Republic of Korea respects the decision of the public commission.” Gratitude was expressed to the commission members, and they were assured that the administration would make every effort to implement the measures suggested by the above decision. The ruling Democratic Party Toburo also expressed respect for the recommendations of the commission, urging the government to support the resumption of construction. Meanwhile, the opposition (as part of a factional struggle) demanded an apology from the President for his previous decision.

However, on the same day, the results of a survey conducted by the agency Realmeter appeared. The respondents were 501 South Koreans adults, and 60.5% of those questioned supported the policy of abandoning nuclear power. 29% of respondents advocated its further development, and 10% remained undecided. And although 500 peopple are not 50 million, Moon’s supporters could now appeal to the fact that, unlike the experts, the broad masses supported the President.

On 22 October, the presidential administration announced Moon’s statement: the head of state noted that a three-month discussion of this issue demonstrated a high level of democracy and stressed that with the completion of the construction of new reactors, their total number in the region near the city of Ulsan with a population of 1 million would reach 15. In this regard, the criteria for the safety of these facilities must be improved in order to calm the local population, as well as to increase the transparency of NPP management. At the same time, the President confirmed the closure of “Wolson-1” and his adherence to the policy of gradual abandonment of nuclear power plants, increasing the use of renewable energy and natural gas.

On 24 October at the Cabinet meeting, Moon Jae-in put an official good front in a troublesome situation. The public discussion of the fate of the fifth and sixth reactors of the Singori NPP created a new model for resolving issues which cause public disagreements, raising the level of democratization of the country. The decision on the construction of the reactors is the result of public consent, achieved with the participation of citizens, which is of great importance to the government policy. At the same time, the discussion, as it turns out, unearthed the people’s agreement with the government’s policy on the gradual transition from nuclear power and coal usage to the implementation of alternative renewable energy sources. According to the Cabinet of Ministers, by 2030 South Korea’s share of renewable energy sources will be 30%, and problems with the possible increase in the electricity prices are expected to be solved through “smart” management. Officials promised that until 2020, electricity costs would stay the same.

As a result of the meeting, a corresponding roadmap and measures were developed to implement the decision of the public commission. As reported by ENHAP agency, theKorea Hydro & Nuclear Power Corp. (KHNP), has begun the search for subcontractors to continue construction and to compensate for the damage caused by a three-month standstill. Apparently, KHNP will cooperate with the companies which were already pulling the bulk of the project anyway: Samsung C&T Corp. with a 51% share in the project and Doosan Heavy Industries & Construction Corp. with a 39% share.

KHNP believes that the damage from the suspension amounted to 100 billion wons and the deadline for putting the units into operation should be postponed for at least 4-5 months (they were supposed to be launched in 2021 and 2022, respectively. Preparing a place for further construction will take 2-4 weeks.

The political parties of the ROK, however, continue to argue. The ruling party Toburo said it would do its best to support the policy of transition to clean energy. The opposition sets the people against this, pointing out the high costs of closing NPPs, but not touching upon the issue of their safety. However, all three opposition parties, not only conservatives, consider the policy of the government premature and unreasoned. From their point of view, the government misunderstands the will of the people in this matter and the statement on the closure of “Wolson-1” contradicts the principle of judiciary independence, considering that this issue is being reviewed by the court.

Why are such experiments dangerous? The author, while not an economist, will try to understand this, but the reader can already pay heed to the fact that most of the anticipated problems will rest with the Moon’s successor. Besides, the rejection of nuclear power plants and the abandonment of coal are actually quite different directions, and today the environment suffers more damage from the second. As for the increase in electricity prices, the South Korean advocate the following: if the share of nuclear energy in the general energy balance falls from 30 to 15 percent due to the development of renewable energy sources, prices will increase threefold—at least. This is not a crisis in and of itself, yet if Moon’s rating falls, he will be blamed for this by the public. Yet until the people’s trust is wholly exhausted, the experiments will continue…

Konstantin Asmolov, Ph.D. (History), leading researcher at the Center for Korean Studies of the Institute of Far Eastern Studies of the Russian Academy of Sciences, exclusively for the online magazine “New Eastern Outlook”.

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