A costly decision

The Korea Hydro & Nuclear Power (KHNP) Corporation has sent a letter to the companies building the Shin Kori 5 and 6 nuclear plants in Ulsan. In the letter, the KHNP, a state-run electric power company in charge of approximately 31.5 percent of the total electric power generated in Korea, asked the companies to take measures to prepare for a temporary suspension of their construction work. The utility company plans to make official its plan to stop the construction of Shin Kori 5 and 6 in a board meeting later this week.

The companies — including Samsung C&T, SK Construction, Hanwha Engineering & Construction and Doosan Heavy Industries & Construction — are not happy with the sudden announcement by KHNP. The consortium immediately demanded that the public utility corporation present its compensation plan to help ease the expected financial pain from the suspension.

Companies involved in the mega-project said they were already working on weekdays only after stopping work at night and on weekends. Their reactions are understandable to the government’s sudden suspension of a massive construction project worth more than 8 trillion won ($6.95 billion).

In a ceremony to decommission the worn-out Kori 1 nuclear reactor in Busan on June 19, President Moon Jae-in declared that he would review the nation’s electricity-generation policy based on nuclear plants, repeal it, and move toward a post-nuclear energy era. Following the declaration, the government temporarily suspended the construction of Shin Kori 5 and 6 starting June 27. It plans to determine the fate of the two nuclear plants after conducting a survey of public opinion about them.

But stopping the construction is not that simple. A huge amount of government funds, totaling1.6 trillion won, has been poured into the project. If it stops, KHNP must compensate construction companies for about 1 trillion won in loss. Some 28.8 percent of the construction is already finished. The cost of stopping construction for just three months is 100 billion won. We wonder if the government can waste such a huge amount of money for the sake of advancing a post-atomic energy era.

The government must devise an energy policy on a long-term basis. To lesson our dependence on atomic energy, it must enhance our competitiveness in renewable energies like solar and wind power. It is not too late for the government to take a path it can better afford.
It is a better idea to continue building the two plants. The government must reconsider the suspension.

JoongAng Ilbo, July 10, Page 30