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Companies expected to speed up investments in small modular reactors
By Lee Kyung-min
Korea's leading firms are fortifying investments in their nuclear power businesses, propelled by the rapidly elevated standing of the long-shunned power source at the recent Korea-U.S. summit, according to market watchers, Wednesday.
During their three-day summit, Presidents Yoon Suk-yeol and Joe Biden reaffirmed their commitment to the development and advancement of a cheaper, affordable and stable source of energy, alongside strengthened overall cooperation in semiconductor and battery manufacturing.
The new priority of the joint economic alliance underscores the rare momentum for both countries, a sign many firms characterize as a stable corporate growth opportunity to overcome years of setbacks due to the COVID-19 pandemic.
Also anchoring the optimism are new energy policy directives by the Yoon administration to scrap the nuclear phase-out policy of the previous Moon Jae-in administration, which has been criticized largely for lacking viable alternatives.
Small modular reactors
Chief among the recipients of major, long-term investments will be the small modular reactor (SMR) industry. SMRs are widely viewed as the next generation of nuclear reactors. Although they are lower in power generation capacity and size compared to existing large nuclear power plants, they make up for that in terms of safety, simplicity of design and construction method.
Hyundai Engineering, a construction affiliate of Hyundai Motor Group, said May 23 that it had established an organization dedicated to advancing nuclear power projects.
Employees of the organization will expand SMR businesses, propped up by the production of the small reactors and hydrogen, as well as decommissioning nuclear power plants and conducting research on nuclear cycle projects and nuclear fuel manufacturing facilities.
"SMRs have emerged as a key vehicle for promoting carbon neutrality, as recognized by global market players," a Hyundai Engineering official said. "The SMR business will grow significantly, backed by recently reiterated commitments of leaders in Korea and the U.S."
Joint investments
Similarly, SK Inc. signed a memorandum of understanding (MOU), May 17, with TerraPower, a U.S. SMR design firm set up by Bill Gates in 2008.
The U.S. firm is best known for sodium-cooled fast reactor (SFR) technology expected to be fully commercialized as early as 2028, an area of cooperation with SK affiliates including SK Innovation in joint research and development projects.
"Local and overseas expansion will be expedited by the industry's overall vigor which will be strengthened," SK Inc. said in a statement.
Samsung Heavy Industries, a plant construction and energy affiliate of Samsung Group, signed an MOU with Seaborg, a Danish next-generation nuclear reactor developer, April 7, to develop floating nuclear power plant barges.
The project will be enabled by close integration of the Samsung affiliate's shipbuilding capabilities and Compact Molten Salt Reactor (CMSR) technology by the Danish firm.
The Seaborg-developed CMSR uses highly efficient fission energy to generate electricity without producing greenhouse gases. The reactor far smaller in size is suited for broader use with fewer limitations compared to existing large nuclear power plants.
Doosan Enerbility, an energy affiliate of Doosan Group, said Wednesday that it will invest 5 trillion won ($3.9 billion) in SMR, gas- and hydrogen turbines and hydrogen fuel cell batteries over the next five years.
The announcement was the latest development after the U.S. president's visit to Korea, on top of its ongoing cooperation with NuScale Power, a leading U.S. firm specializing in SMR technology.
They plan to begin the production of key SMR products in the second half of 2023, buoyed by the increase in investments to revitalize the ecosystem of the nuclear energy market.
Optimism
The collective move is encouraging, according to Lee Jong-ho, a senior researcher at the Nuclear Research Institute for Future Technology Policy (NIFTEP) affiliated with Seoul National University.
"The nuclear energy industry was close to collapsing altogether, but recent investments show signs of hope," he said.
The rapid upturn in corporate investments offers much-awaited economic growth momentum, Seoul National University economist Lee In-ho said.
"Businesses have long remained reluctant to make investments, leading to a slowdown in the economy. Jobs created by new investments will help lift vibrancy," Lee said.
Park Ho-jeong, a professor of Resources and Energy Economics at Korea University said corporate activities will be bolstered, as indicated by the recent shift in priorities by the Yoon administration's newly-appointed energy authorities.
Minister of Trade, Industry and Energy Lee Chang-yang said at his inauguration on May 13 that the government will reorient energy policies to give more weight to the use of nuclear power.
Second Vice Industry Minister Park Il-jun made a visit to a nuclear power equipment manufacturing plant of Doosan Enerbility in Changwon, South Gyeongsang Province, May 20.
He attended a meeting joined by industry workers as one of his first official schedules as the energy authority. Park said he would review ways to simplify approval procedures for nuclear power facility construction. Government assistance in nuclear system exports will be strengthened to bring more work for local firms, he added.
