The nuclear power generation and renewable energy markets of South Korea are collapsing due to the South Korean government’s wrong energy policy.
In the nuclear power generation market, an increasing number of companies are returning their Korea Electric Power Industry Code (KEPIC) certificates to pull out of the market. Specifically, the number of companies with the certificate fell from 222 in 2015 to 186 last year.
In the renewable energy market, South Korean companies producing polysilicon as a key photovoltaic material are on the verge of shutdown. Irrespective of the government’s loud promotions about how to grow the industry, the market is already filled with cheap supplies from China and electricity costs account for as high as 40 percent of polysilicon production costs.
The South Korean government’s nuclear phase-out policy has led to a higher ratio of LNG, which is more expensive than nuclear power-based electricity, and price pressure is increasing as a result. Last year, the price of electricity applied to industries was 105.8 won per kwh, one won higher than the price applied to houses. Last year was the first time when the former exceeded the latter.
The story is not that different in wind farms. The ratio of domestically developed equipment is about 50 percent at best and the development of turbines, the most important component, is being led by the United States. Besides, multiple wind farm construction projects have been thwarted due to locals’ objection. When it comes to energy storage systems, a total of 28 fires have occurred since 2017 and the government blamed ESS batteries on Feb. 7.