"Budget Cuts Even for Overcoming Mid-Term Nuclear Power Crisis... Export Also Impacted"

Democratic Party Unilaterally Cuts Entire Next Year's Nuclear Power Budget
Industry and Academia Stunned... "Small and Medium Enterprises Will Suffer"

The full meeting of the National Assembly's Industry, Trade, Energy, Small and Medium Venture Businesses Committee is being held on the 20th without the participation of ruling party members. (Photo by Yonhap News)

On the 20th, when the Democratic Party of Korea unilaterally decided at the National Assembly's Industry, Trade, Energy, Small and Medium Enterprises Committee to cut the entire 181.4 billion KRW budget related to nuclear power plants for the next year, the nuclear power industry and academia could not hide their bewilderment. If the budget cut in the committee is finalized as is, the damage will directly affect small and medium-sized enterprises related to nuclear power. The nuclear power industry hopes that the related budget will be restored during subsequent procedures such as the Budget and Accounts Special Committee.

The nuclear power-related budget cut by the Democratic Party on that day amounted to 181.4 billion KRW, including the nuclear power ecosystem financial support project (100 billion KRW), innovative Small Modular Reactor (SMR) project (33.3 billion KRW), nuclear power export guarantee project (25 billion KRW), and advanced manufacturing technology and parts and equipment development responding to on-site demand (6 billion KRW).

Among these, the nuclear power ecosystem financial support project is a program that provides low-interest loans for facility investment and working capital to small and medium-sized nuclear power companies facing difficulties such as work stoppages due to the previous government's nuclear phase-out policy. The Ministry of Trade, Industry and Energy planned to select and support 40 to 50 qualified companies. A ministry official said, "If the related budget is entirely cut by the National Assembly, nuclear power companies that have barely overcome hardships may lose the opportunity to recover," adding, "Ultimately, the damage will fall on small and medium-sized enterprises."

The nuclear power export guarantee project is designed to provide export guarantee insurance support specialized for small and medium-sized nuclear power export companies that have difficulty obtaining existing export guarantees due to weak financial conditions. The Ministry planned to use special funds from the Korea Trade Insurance Corporation to support export guarantees worth 125 billion KRW for domestic nuclear power equipment companies. The main beneficiaries are partner companies of domestic nuclear power public enterprises such as Korea Electric Power Corporation and Korea Hydro & Nuclear Power that have secured nuclear power projects.

If export guarantees are not smoothly provided, Korean companies may face difficulties in exporting projects they have won, such as the second construction of the El-Dabaa nuclear power plant in Egypt and the tritium removal facility project for nuclear power in Romania.

The budget for the innovative SMR project, which has been promoted since the Moon Jae-in administration, was also entirely cut. SMRs, which are smaller in size and scale than existing nuclear power plants, have excellent safety and economic efficiency, and research and development (R&D) is actively underway worldwide. Even under the previous government, which had a nuclear phase-out policy, the necessity of SMR research was recognized, and a preliminary feasibility study worth 388.9 billion KRW was approved. The Innovative Small Modular Reactor Project Group was launched in July this year, and after a preparation period, full-scale R&D was planned to begin next year. Kim Han-gon, the project group leader, said, "Twelve projects have already started this year," adding, "If the budget is reduced, R&D will inevitably be interrupted or face setbacks."

An official from the Ministry of Trade, Industry and Energy said, "We will do our best to restore the cut budget during the remaining period of the National Assembly together with the Ministry of Economy and Finance and other financial departments."