"People, rest easy." Deputy Industry Minister confident Czech nuclear power plant will succeed in final contract in March next year

YTN Radio (FM 94.5) [YTN News FM Wise Radio Life]
□ Broadcast Date: November 4, 2024 (Mon)
□ Host: Announcer Park Gui-bin
□ Castor: Choi Nam-ho, Second Vice Minister of Trade, Industry and Energy

* The text below may differ from the actual broadcast content, so please check the broadcast for more accurate information.

[YTN Radio <News Fighting, Bae Seunghee]> Please clarify that it's about the interview.]

◆Park Gui-bin: There was a temporary suspension as the United States and France raised objections to Korea's order for the Czech nuclear power plant. The Czech Republic has turned the corner once, rejecting the objections of its competitors. Last week, the groundbreaking ceremony for Shin Han-ul units 3 and 4 was completed, and the Yoon Suk Yeol government's nuclear power plant drive is gaining more power. Let's talk about it in detail. Let's call Choi Nam-ho, the second vice minister of the Ministry of Trade, Industry and Energy. Hello, assistant minister.

◇ Choi Nam-ho: Yes, hello.

◆Park Gui-bin: The nuclear power plant contract that was signed with the Czech Republic a few days ago was temporarily suspended. It was reported that it was checked within a day and rejected the objections of the competitors. First of all, please briefly summarize what happened.

◇Nam-ho Choi: It will be July 17th that Team Korea, including KHNP, has been selected as the preferred bidder for the construction of a new Czech nuclear power plant. At that time, the competitor was EDF in France. And Westinghouse was now a competitor, even though it did not issue a bid, so the two competitors filed a complaint with the Czech competition authorities to the effect that there was a problem with the process of bidding for the nuclear power plant. And because the complaint was raised, the standard procedure was carried out. However, in the process, the standard procedure was reported a little too much, and fortunately, the next day, the Czech competition authorities raised some points, but most of them are for no reason. It will be a matter that was dismissed or dismissed because it was not a problem. In fact, we judged in advance that there were no big problems, but we are judging that the decision to dismiss it has resolved a lot of uncertainty.

◆Park Gui-bin: Then what are the procedures left until the final contract in March next year?

◇Nam-ho Choi: We're still negotiating, but the negotiations will continue. Actually, it will be November 11th next week. In the meantime, we have mainly gone to negotiate with the Czech Republic by wire, but there are about 60 negotiators for Czech negotiations. About 60 negotiators visit Korea. So I visit Korea and there are about five fields. Detailed negotiations are planned for each of the five groups, including overall business management in the economic, commercial, and technological sectors, and nuclear fuel-related fields. So, after negotiations by each contract negotiation sector, I hope that the final contract will be successful by March next year.

◆Park Gui-bin: The main contract was resilient in March next year, but there was actually a controversy over the Czech nuclear power plant construction project, so there was a controversy over the low price level. So, is it right to be profitable? There is a controversy like this, what would you say about this?

◇ Choi Nam-ho: Of course, we haven't signed the final contract yet, so we have to decide on the terms and conditions of the final contract, but as you may have seen in our Czech Republic, the Czech Republic announced that the amount set for the second term is 24 trillion won. Prior to this announcement, the financial sector had initially judged that the estimated amount was 15 trillion won. So, since it was announced at a much higher price than expected, I believe that this can solve the concern of low-cost orders in general. In fact, another reason is raised, and some say that the construction cost in Korea is too low, but we believe that the low construction technology is actually an indicator of the excellent technology and business management capabilities of the Korean nuclear power industry. In fact, there are articles that the price difference between Korea and France was not large when bidding was made in other European Le Monde and mainly in the media. So actually, I think this amount itself should be the final contract, but in terms of the amount itself, I think the dumping controversy is a bit too far ahead. However, I would like to say that we will make more efforts to completely eliminate all of these concerns in the final contract.

◆Park Gui-bin: So if you look at the outline of the new nuclear power plant business, it became the first target of negotiations in July 2024, our country, and we are about to sign a final contract in March next year. So when will the construction start? If you look at the outline here, it says that construction will begin in 2029, but it takes about 10 years to start construction.

◇Choi Nam-ho: That's right. It takes about 10 years.

◆Park Gui-bin: So you're thinking that we're going to proceed according to the plan without much difficulty, right?

◇Nam-ho Choi: Of course, the most important thing now is what terms and conditions we sign the contract. In the process of such a contract, we believe that we will successfully conclude contracts in various fields because there are various problems with our construction and operation.

◆Park Gwi-bin: Yes, I see. In fact, President Yoon Suk Yeol announced that he would enact a special law on supporting the 2050 mid- to long-term nuclear power industry roadmap to prevent the nuclear power industry from collapsing due to politics. Please point this out, too.

◇ Nam-ho Choi: So there was a lot of talk about that at public welfare debates, especially in the general public and the student base. Many people say that stable operation of nuclear power plants is a little difficult due to political problems, so the government says it will prepare two things to operate nuclear power plants based on a more mid- to long-term perspective. The first will be the 2050 mid- to long-term nuclear power industry roadmap. So, the roadmap will mainly include what vision our nuclear power industry has from a longer-term perspective, and what support measures will be prepared to achieve this vision. So, by 2050, the government will make efforts to expand the size of Korea's nuclear power industry and what kind of support will be provided to strengthen the foundation of such a nuclear power industry. Especially, wouldn't the SMR sector be discussed a lot these days? Therefore, even in the small modular reactor sector, the government will try to make a leap forward to agitation through any support, especially through exports of Czech nuclear power plants, but what support and efforts will be made to industrialize nuclear power plants. In addition, we plan to enact a special law for supporting the nuclear industry in order to support this roadmap and to operate nuclear power plants in an overall stable manner. Let me tell you that we are working on a bill to include a basic plan that includes strengthening the competitiveness of the Korean nuclear industry or overall contents, financial support related to licensing, and export support. In fact, the bill itself was already proposed by the National Assembly last October.

◆Park Gui-bin: I see. It's the 27th and 28th nuclear power plant in Korea. It has been reported that the construction of Shin Hanul Units 1 and 2 has begun at the same time. What's the meaning of this?

◇Choi Nam-ho: So first of all, the nuclear power plant ecosystem itself suffered a lot during the process of nuclear power plant de-nuclearization during the last government. However, it means that the construction of Shin Hanul Units 3 and 4 has begun, and that we have fulfilled our promise to secure carbon-free power and achieve carbon neutrality around nuclear power plants in the new government. In addition, since additional work is supplied to the nuclear power plant ecosystem as mentioned earlier, it becomes an opportunity for the nuclear power plant ecosystem to spread more stably. It is also expected to revitalize the region and the local economy. In the case of Shin Hanul Units 1 and 2, the two have a facility capacity of about 2.8 kW. As you know, demand for nuclear power plants is increasing a lot these days through high-tech semiconductor factories and various AIs. What these high-tech industries need is a stable power supply. It also means that we have secured a stable power source. And actually, this will be a very cheap power source. It has the effect of reducing energy costs much more than coal or LNG power generation. In addition, it has the effect of reducing carbon dioxide emissions a lot, so we believe that it will probably contribute greatly to Korea's achievement in 2050.

◆Park Gui-bin: There is a saying that it is the renaissance era of nuclear power plants. Do you have any expectations or plans for additional orders or expansion of exports to Europe starting with this Czech nuclear power plant order?

◇Choi Nam-ho: I think it's a little too early to say that it's going to be a certain area right now. Various regions are now announcing plans to build nuclear power plants. So we judge that there are about 100 nuclear power plants planned worldwide. It's happening simultaneously in different regions, some of which are now doing feasibility studies, some of which may be in the process of feasibility studies, and some of which have announced that they will bid within a short period of time. So we have plans to respond to all the bids from various regions. However, since we became the preferred bidder in the Czech Republic, we believe that if we reach the final contract, the excellence of our nuclear power plant will be an opportunity to promote a lot. In fact, the president of Yoon Suk Yeol went to the Czech Republic last time and even signed a nuclear power plant alliance. In fact, the Czech Republic has a very good machinery industry and is highly competitive in various manufacturing industries, so if we cooperate with the Czech Republic to respond to these bids, we will see more machines. Also, I personally hope that there will be more opportunities in that sense because we have already secured excellence in such areas as completion in Baraka.

◆Park Gui-bin: It was temporarily put on hold when the U.S. and France raised their objections, but the Czech Republic rejected their competitors' objections and gained momentum from the main contract in March next year. We started talking like this earlier, but we'll be the first ones to negotiate and negotiate the main contract, right? If it doesn't go well during the negotiation process of this contract, is there a possibility that the contract won't work or something like this?

◇Choi Nam-ho: I don't think so. Negotiations are now going well and the fact that negotiators are coming from the Czech Republic is going well. In addition, the rejection by the competition authorities is also resolving a lot of uncertainties. However, some people are mentioning some of the intellectual property issues as the last two points raised by the media. So, as far as I know, negotiations between Hanseong and Westinghouse are proceeding smoothly. In addition, since the two governments of the United States and South Korea are closely cooperating with each other regarding export control, we believe that if these two issues are completely resolved, contract negotiations can be carried out without difficulty.

◆Park Gui-bin: We plan to negotiate detailed terms. In the future, about 60 people in the Czech Republic will visit Korea, but you're continuing to work behind the scenes.

◇Choi Nam-ho: Of course. So, we've already told you in front of the Czech Republic, but there were various negotiations on the phone and we went to the Czech Republic. The reason why the 60-member delegation is coming is that they think they can make a judgment only when they actually see it in person. on the Czech side So, of course, you'll see the nuclear power plants we're operating now, but I think that various companies in the supply chain, including Doosan Efficiency, will also check all of them.

◆Park Gui-bin: There is an issue pointed out by the opposition party in this parliamentary inspection. I mentioned it earlier, but there was a point that it wasn't a gifting method. In this regard, it would be good to briefly convey the position of the Ministry of Trade, Industry and Energy.

◇Choi Nam-ho: So some of the problems I mentioned earlier were pointed out, but the most pointed out was that there was financial support. To be precise, I understand that there was also a controversy over whether this was given to export credit institutions by submitting letters of intent related to export credit. However, we are one of the countries that run Korea's national economy through exports. It is also very dependent on foreign countries. When we export various things, export credit institutions provide credit. So, as far as I know, I submitted a letter of intent, and export credit is not just provided. In fact, there is a general agreement in the OECD regarding these export credits. So, within the scope of the agreement, each export credit institution always shared export credit on the condition that they could win each other. So, rather than giving, it shares specific credit, and of course, credit provision is mainly an export credit institution, and in Korea, the Export-Import Bank or the Korea Trade Insurance Corporation. Likewise, we will provide export credit for our own commercial purposes. So, Korea exports nuclear power plants, but it also exports defense and provides various services related to exports when trading various and general items. In that sense, we submitted a letter of intent related to the use of our country, but in the case of the first Czech Republic, the Czech government plans to raise funds on its own, so we do not need to receive export credit at this time. Now, in the case of Ducobani Unit 6, if there is a need for additional export credit, it is necessary to review it then, so we explained it in that sense, and we believe there was a little misunderstanding in that regard. However, as far as I know, that part has been resolved a lot.

◆Park Gwi-bin: Yes, I see. I think the listeners have a lot of questions during the interview with the vice minister. I think the public's interest in this matter is that great, so if you look at it, there are texts saying that they look forward to it and support it. On the other hand, there should be substantial, so please say something to the Korean people ahead of the main contract for the Czech nuclear power plant order.

◇ Nam-ho Choi: Yes, we exported the Czech nuclear power plant as a preferred bidder, but I understand that you have given us various concerns and encouragement. Perhaps that means that we are taking it as an encouragement to do our best until the Czech negotiation contract is completed and be in the national interest. I would like to say that I will try to make a contract so that it can meet our national interests as much as possible, including all these opinions and concerns of the people. And one more thing, the export of this nuclear power plant is not limited to the nuclear power plant sector, but the meaning of exporting it to Europe is that we are entering the heart of the nuclear power industry because Europe was the first region in the world to be built. So, it is because we judge that it is helpful for Korea's overall technology and national enhancement beyond nuclear power plants. We will tell you that the government will do its best with our team Korea so that we can not only succeed in the contract of the Czech nuclear power plant export contract but also win additional orders.

◆Park Gwibin: I see. Please continue to work hard. So far, I was Choi Nam-ho, the second vice minister of the Ministry of Trade, Industry and Energy. Vice Minister, thank you.

◇Nam-ho Choi: Yes, thank you.