South Korea increases support for domestic nuclear industry

Monday, 10 February 2025

"The government is moving forward with large-scale policy fund support to enhance the competitiveness of domestic companies and support the continuous growth of the nuclear power industry," the ministry said. It will begin selecting companies to benefit from the Nuclear Power Plant Ecosystem Financial Support Project, which will provide low-interest loans for facility investment and operating funds for small and medium-sized nuclear power companies.

The Ministry of Trade, Industry and Energy (MOTIE) noted that since the financial support project was launched in 2024, it has successfully provided about KRW100 billion in loans to 69 companies.

It said this year's budget has been increased "considering the recent acceleration of construction of Shin Hanul units 3 and 4, and the expansion of overseas orders (Egypt, Romania, etc)".

Companies selected for support under this project can receive loans of up to KRW11 billion (up to KRW10 billion for facility funds and up to KRW1 billion for operating funds) at a low interest rate of 1-2%, and the loan period is up to 10 years (10 years for facility funds, 2 years for operating funds). The funding will be provided through eight commercial banks, including IBK Industrial Bank of Korea, Gyeongnam Bank, Kookmin Bank, Busan Bank, Shinhan Bank, Woori Bank, Hana Bank, and Korea Development Bank.

Following his election 2022 President Yoon reversed the previous president's policy of phasing out nuclear power. In July 2022, Yoon encouraged a speedy restoration of the country's "nuclear power plant ecosystem" after Minister of Trade, Industry and Energy Lee Chang-yang set out plans for revitalising South Korea's nuclear power industry, including the aim for work on Shin Hanul 3 and 4 to resume as early as 2024.

In July 2022, the South Korean government laid out a new energy policy which aims to maintain nuclear's share of the country's energy mix at a minimum of 30% by 2030. It also set the goal of exporting 10 nuclear power plants by 2030, as well as the development of a Korean small modular reactor design.

The following month, the Ministry of Trade, Industry and Energy signed a memorandum of understanding with Korea Hydro & Nuclear Power, Doosan Enerbility and nuclear energy equipment and materials manufacturers with the aim of revitalising the country's nuclear industry. The MoU aims to improve the competitiveness of the nuclear industry ecosystem through shared growth, working together to contribute to carbon neutrality, responding to the energy crisis and stabilisation of power supply. Based on this, the industry plans to closely cooperate to create new jobs, develop joint technologies, exchange manpower and expand exports.

Preparatory groundwork began for the construction of Shin Hanul units 3 and 4 following the approval by the South Korean government of the project's implementation plan in June 2023. The approval of the plan effectively approved 20 licensing and permitting procedures under the jurisdiction of 11 ministries required for the construction of nuclear power plants. South Korea's Nuclear Safety and Security Commission issued a licence to KHNP for the construction of the two APR1400s in September. A ceremony was held in late October to mark the start of construction of the units, which are scheduled to be completed by 2032 and 2033, respectively.