I got a “bill” for $47,400,000,000,000… What was that?
The cost of the “nuclear phase-out” policy promoted by the previous Moon Jae-in administration will total 47 trillion won by 2030, according to a study by the Seoul National University nuclear think tank. Since the Moon administration took office in 2017, it has already cost nearly 23 trillion won through last year, and another 24 trillion won over the next seven years, starting this year, according to the analysis.
The massive costs are bound to continue even after Yoon’s inauguration because the government used a lot of expensive liquefied natural gas (LNG) while significantly reducing the operation of nuclear power plants, and halted new construction and delayed the process of continuing operation.
The Nuclear Policy Center at Seoul National University said on Nov. 21 that the cost of decommissioning nuclear power plants in the six years from 2017 to 2022, during the Moon Jae-in administration, was 22.9 trillion won, and the ripple effect is estimated to cost another 24.5 trillion won from 2023 to 2030, after the Yoon administration takes office. The total cost from 2017 to 2030 is 47.4 trillion won.
By year, it was calculated that 1.9 trillion won ($1.9 trillion) was incurred in 2017, 3.7 trillion won in 2018, 3.1 trillion won in 2019, 1.4 trillion won in 2020, 3.2 trillion won in 2021, and 9.6 trillion won in 2022. The Seoul National University Nuclear Policy Center explained that the reason for the large increase in costs last year is that “the price of LNG has risen sharply, while the settlement unit price of nuclear power plants has decreased, resulting in a large gap between the two sources of power generation.”
The government of Yoon Seok-yeol, which took office last year with a promise to scrap the nuclear policy, was estimated to incur costs of 2 trillion to 3 trillion won annually from 2023 to 2030.
The government finalized the 10th Electricity Supply and Demand Basic Plan (EDP) in January and increased the number of nuclear power plants again, but it was largely affected by a reduction in the number of facilities compared to the 7th EDP due to delays in the construction of Shinsegori Units 5-6 and Shinhanul Units 3-4 and the cancellation of Cheonji Units 1-2, among others. It also reflected the costs incurred due to late applications for continued operation permits.
The Moon Jae-in administration’s nuclear phase-out policy is broadly categorized as: halting the construction of ongoing nuclear power plants, canceling plans to build new nuclear power plants, prohibiting the continued operation of nuclear power plants, and early closure of Wolsung Unit 1. The Nuclear Policy Center explained, “The projected amount of nuclear power plant capacity in 2030 according to the ‘Nuclear Power Roadmap’ is 20.4 GW, which is half the amount of the 7th edition (38.3 GW) released in 2015.”
In the aftermath of the nuclear phase-out, the energy mix has also shifted to a more costly structure. As the share of nuclear power generation has decreased, LNG power generation has taken over. The Center for Nuclear Policy criticized the policy, saying, “The nuclear phase-out policy, coupled with the energy crisis triggered by the Russian-Ukrainian war, became the main cause of KEPCO’s operating losses (32.65 trillion won) last year.” In effect, KEPCO was forced to bear the cost of nuclear power plants.
Yang Jun-mo, a professor of economics at Yonsei University, said, “The phase-out policy has reduced the number of nuclear power plants and increased the share메이저놀이터 of high-cost power sources such as renewable energy (solar and wind), and the share of LNG power generation has also increased to solve their intermittency problems.” “This, coupled with the freezing of electricity prices, has directly impacted KEPCO,” he added.
It was also pointed out that the domestic nuclear power industry shrank rapidly due to the nuclear phase-out policy. “The domestic nuclear industry is on the verge of collapse, with sales down 41.8 percent and the number of workers down 18.2 percent in the five years of the Moon Jae-in administration,” the Nuclear Policy Center said. The industry’s revenue, which was 5.4 trillion won in 2016, dropped to 3.2 trillion won in 2021, and the number of workers dropped from 22,000 to 18,000 during the same period.
However, the Nuclear Policy Center said that the analysis was “limited to estimating the difference between the settlement unit price for each energy and the supply cost due to changes in power generation.” It did not reflect external effects such as increased costs due to ecological degradation or the benefits of reducing greenhouse gases and air pollutants due to an increase in the share of nuclear power plants.