Second massive blackout looming larger

By Park Si-soo

Traffic lights stopped working. A ballpark was covered in darkness. Elevators halted in the middle of a shaft, causing people to panic. Agriculture-related firms and fish farms went hours without electricity, during which they were helpless to prevent irreparable damage to their products.

These are dismal snapshots of a rolling power outage that struck South Korea from 3:11 p.m. on Sept. 15.

The selective power cuts were implemented by the Korea Power Exchange (KPX) to prevent a broader, nationwide blackout amid soaring electricity demand due to unseasonably warm weather.

On that day, more than 2,800 traffic signs went blank wreaking havoc on major roads. A boy was hit by a car and died in the confusion at an intersection.

According to government data, nearly 2,100 people were trapped in elevators for nearly an hour and more than 4,500 factories sustained damage worth 30 billion won or $26 million.

But the crisis is not over yet. Experts warn of another massive, nationwide blackout as this winter has already seen a prolonged period of freezing weather.

“The September power outage was a sort of warning sign,” said Kim Geun-ho, spokesman for the Korea Energy Management Corporation. “Without fundamental changes in electricity use, second and third power outages, affecting broader areas, are a constant threat this winter.”

Uphill battle

Two months after the incident, President Lee Myung-bak gave a public address imploring people to save electricity. Lee said the country faced an “uphill battle” to avoid future blackouts.

“We could experience a second emergency situation during winter due to an electricity shortage,” Lee said in a nationwide radio address on Nov. 28. “The government has set up a variety of measures to prevent this. Without your cooperation, however, the measures will have limited impact.”

He called on the public to corporate with the government with a “sense of desperation.”

Admitting that he was wearing long johns, Lee urged all citizens to do the same. “I wear thermal underwear to cope with the lowered thermostat indoors,” he said. “It was uncomfortable at first. But I got used to it and now I am very warm and comfortable wearing an extra layer of clothing.”

The government called on businesses, civil servants and citizens in early November to use less power because the country’s reserves were likely to be low all winter. Big companies have been told to cut power consumption by 10 percent compared with last year during peak times.

The government initiated a second conservation step earlier this month.

It has told major power consumers and even shops and restaurants that have neon signs to drastically trim electricity usage. The signs have to be turned off during peak hours from 10:30 a.m. to 12:00 p.m. and 5 to 7 p.m. Violators are subject to a fine of up to 3 million won or $2,580.

The Ministry of Knowledge Economy asked buildings and industrial plants that use more than 1,000 kilowatts of electricity to cut use by 10 percent during peak hours.

In line with the movement, the Bank of Korea and other financial institutions have decided to turn off their buildings’ heating system during peak hours.

Many department stores have joined the campaign by reducing the use of outdoor decorations, including ones for Christmas.

“By turning off Christmas lights, we will be able to save 7,700 kilowatts for three months at the central store and reduce 10 percent of electricity usage compared to last year,” said a spokesman for Lotte Department Store.

The government said the conservation guidelines for companies and buildings will be enforced until the end of the winter peak season on Feb. 29.

The second issuance of power-saving measures resulted in greater concerns of an unstable power supply.

As if on cue, two nuclear reactors abruptly halted in early December. On Dec. 13, a nuclear reactor in Uljin with a capacity of one million kilowatts came to a standstill due to a condenser for steam turbines briefly failing to operate properly.

Only 12 hours later, another reactor in Gori, South Gyeongsang Province, with a capacity of 950,000 kilowatts experienced a temporary overvoltage.

The authorities immediately repaired the reactors so that the accidents didn’t interfere with the power supply. But the two incidents underscored the threats to the country’s power supply.

Atomic power provides more than 30 percent of the country’s total electricity, according to the economy ministry.

Korea Electric Power Corp. (KEPCO) said the electricity reserve rate remained well above five million kilowatts despite the suspension of the two reactors. The minimum level that is considered safe is well over four million kilowatts. South Korea runs 21 nuclear power plants and plans to build 14 more by 2024.

Stopgap measures

Experts say power-saving campaigns are not a fundamental solution for today’s power shortages. They call for a noticeable hike in electricity rates.

“Korea’s low electricity rates have long caused an imbalance in the overall energy market, where people prefer using electricity to fossil fuels like gasoline,” said Jeong Jae-hoon, head of the economy ministry’s energy and resources department. “To normalize the slanted market, a hike in electricity rates is necessary.”

Jeong said the amount of electricity consumed during winter exceeded that of summer for the first time in 2009 and the gap has since widened.

The 2009 summer peak in August recorded consumption of 63.21 million kilowatts, while that winter the peak in January 2010 was 68.96 million kilowatts.

The summer peak in 2010 saw a moderate increase to 69.89 million kilowatts but that winter showed a drastic increase to a high of 74.61 million kilowatts, according to the KPX.

“This is evidence of an unsustainable energy market stemming from the government’s policy to keep electricity rates at a low level,” said Moon Seung-il at Seoul National University’s department of electrical engineering.

“The situation we face is that the government, for example, spends 1,000 won generating a certain amount of electricity, but it’s offered to the public at 850 or 900 won. This unreasonable pricing system creates an environment in which people rely heavily on electricity.”

Since 2001, the price of kerosene has increased 125 percent while diesel has soared 172 percent. During the same period, the electricity rate rose a mere 8.8 percent, a result of the government’s struggle to fight inflation, Moon said.

From 2009, the state-run KEPCO has been suffering chronic losses due to not being able to meet its production costs, leading it to complain that Korea’s electricity charges are only half the OECD average.

Earlier this month, the government raised electricity prices by an average of 4.5 percent, a desperate move to reduce people’s electricity use. The increase will allow KEPCO to make up 90.9 percent of production costs, up from the current 87 percent, according to the company.

“We will continue to find ways to offer reasonable rates and maintain electricity prices at a realistic level in order to prevent the excessive use of power,” Jeong said.