“A cautious approach is needed for permission within the ultra-wide special zone…possession of cherry picking”
(Seoul = Yonhap News) Reporter Jaeyoung Lee = The Ministry of Climate, Energy and Environment announced that electricity rates may rise if a 'nuclear power purchase agreement (PPA)', which allows a specific company or industrial complex to monopolize electricity produced from nuclear power plants, is allowed.
According to Rep. Park Hae-cheol of the Democratic Party of Korea and other members of the National Assembly's Climate, Energy, Environment and Labor Committee on the 26th, the Ministry of Climate Change opposed two bills allowing nuclear power plant PPAs in March, saying, "It would be a monopoly on cheap power by a specific business operator."
The Ministry of Climate Change defined nuclear power plant PPA as 'cherry picking' and emphasized, "If a specific (hydrogen specialized) complex monopolizes large-scale nuclear power plants, which account for 31% of domestic power generation, it could cause significant disruption in the management of national power supply and demand."
He added, "Allowing cheap nuclear power power exclusively to certain consumers runs counter to the purpose of the Electricity Business Act, which aims to protect the public, who are the majority of electricity consumers."
However, in response to a recent inquiry from Rep. Park's office regarding nuclear power plant PPAs and the regulations allowing PPAs in special zones under the Mega Special Zone Act (Mega Special Zone Act), the Ministry of Climate Change acknowledged that "permitting nuclear power plant PPAs is a factor that will increase the average power purchase price and increase the consumer bill burden," but said, "A cautious approach is necessary." Unlike before, this can be interpreted as leaving room for acceptance.
When electricity produced from a nuclear power plant is supplied to a specific business operator through a PPA outside the electricity market, other electricity consumers must use electricity produced from a power generation source that costs more than a nuclear power plant.
Ultimately, the average price at which KEPCO purchases electricity from power plants rises, adding to the pressure to increase electricity rates.
Representative Park's office calculated based on the unit price of electricity purchased in the first half of this year that if one company monopolized the electricity produced by Unit 2 of Wolseong Nuclear Power Plant (4.8 billion kWh per year), the additional electricity purchase cost that would be borne by other electricity consumers amounted to 280 billion won.
Nuclear power plants require enormous financial and social costs throughout the entire cycle, from site selection to radioactive waste management. Accordingly, if a nuclear power plant PPA is allowed, equity issues are bound to arise, even excluding the increase in the burden of electricity bills.
Rep. Park emphasized, “If the Ministry of Climate Change acknowledges in writing the increase in electricity rates when a nuclear power plant PPA is permitted, and remains cautious, it ultimately opens the way to acceptance,” adding, “The government must make it clear that both operating nuclear power plants and new nuclear power plants are not subject to PPA.”
The Ministry of Climate Change said in a separate explanatory material on this day, "We have consistently and consistently expressed our position that we cannot accept bills allowing nuclear power plant PPAs, including the Ultra-Metropolitan Special Zone Act. Considering concerns about an increase in the burden of electricity bills for general consumers and the possibility of cherry-picking due to the exclusive use of nuclear power, it is difficult to accept nuclear power plant PPAs."
