[Open Forum] How Can We Revive Nuclear Power—Backed by Bill Gates?

The retreat of the nuclear power industry is an enormous economic loss. At a time when nuclear power generation is included in carbon neutrality, the condition of Korea’s domestic nuclear power industry is grave. The nuclear phase-out policy has already caused losses of 1,000 trillion won, and the industry’s competitiveness has fallen by 30–40%; it will take about four years to recover. This situation can be seen as a side effect of the government’s one-sided nuclear industry policy, pushed ahead without properly reading broader macro trends.

In Korea, nuclear power is not a choice but a necessity. This is because the EU Taxonomy Regulation, which classifies nuclear power as green energy, passed the European Parliament. At a time when carbon neutrality has become increasingly important, nuclear power has been categorized as green energy. Major EU countries and the United States are already moving to expand nuclear power. They are doing so to achieve energy independence and reduce the carbon emissions generated by coal and thermal power generation.

Electricity demand is also expected to continue increasing. Around the world, countries are moving to reduce internal combustion engines and expand the electric vehicle market in order to cut carbon emissions. As the EV market grows in line with global trends, electricity demand is rising further, yet Korea faces concerns over power supply every summer. In such a situation, without nuclear power as a foundation, the development of the electric vehicle industry will be impossible.

Let us look at overseas markets, where regulations are relatively less restrictive. In the overseas small modular reactor (SMR) industry, utilization potential and growth prospects are high, which is why Bill Gates and Warren Buffett are investing in it. The IEA has said that nuclear power capacity, currently at 413 gigawatts (GW), needs to be expanded to 812GW by 2050. The industry is continuing to grow.

In addition, technological innovation is taking place in related industries. Abroad, new nuclear waste treatment technologies are being developed. In Korea, the government viewed nuclear waste as a major headache and directly prohibited construction of the Shin-Kori reactors, but overseas, companies and universities developed nuclear waste treatment technologies to solve the problem. Market logic has naturally been applied to the agents of production, and problems are being resolved.

Then what would be the best way to revive Korea’s nuclear power industry? The fundamental solution is to shift policy and restore the industry’s competitiveness. To do this, direct state-led intervention should be avoided. In Korea, the primary purchaser of nuclear-generated electricity is the state, 100%. As a result, when the state imposes regulations that diverge from reality, it inevitably undermines the market competitiveness of the nuclear power industry. A policy shift is needed in order to enhance the competitiveness of the nuclear power industry ecosystem.

What is the most urgent problem facing domestic nuclear power companies? The most common response, at 35.7%, was a shortage of skilled personnel. The number of new undergraduate, master’s, and doctoral students in nuclear studies in Korea fell by 34.7% in 2020 compared to 2016. This problem, too, can be resolved by easing the government’s misguided regulations. A policy shift would promote growth in the nuclear power industry, and as the industry grows, talent will naturally flow in. Therefore, rather than support measures that provide only temporary effects, regulatory easing through policy change should be implemented first. As overseas cases have shown, guaranteeing free corporate activity naturally resolves a variety of problems.

Considering economic viability, practicality, and sustainability, a policy shift on the nuclear power industry is absolutely necessary. We must read the broader trends and not miss the golden time to restore competitiveness.

Youngje Kim, Intern Researcher, Center for Free Enterprise (CFE)

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Original title: [자유발언대] 빌 게이츠도 투자한 원전, 다시 살리려면?

Author: Young-je Kim

Date: 2022-10-04

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=free_opinion&pn=7&idx=24989