Main Contract for Czech Nuclear Power Plant Signed After Launch of New Administration, Will President Lee Visit Czech Republic?

Main Contract Signed After Supreme Administrative Court Overturns Injunction
President Lee Jaemyung May Be Invited to Separate Event in Czech Republic
"First Order in Europe... A Foothold for Nuclear Exports to Advanced Countries"
"To Win Additional Orders, Korea Must Show Support for Nuclear Power"

Perspective view of the new Dukovany nuclear power plant in the Czech Republic. Korea Hydro & Nuclear Power

With Korea Hydro & Nuclear Power signing the main contract for the new nuclear power plant project in the Czech Republic on June 4 (local time), the nuclear industry expects this to have a positive impact on the energy policy of the Lee Jaemyung administration. There is also speculation that President Lee Jaemyung may be invited to official events hosted by the Czech government related to the construction of the new nuclear power plant in the future.

Korea Hydro & Nuclear Power announced that it had signed the main contract for the new nuclear power plant project with Dukovany II Nuclear Power Plant (EDU II), the Czech project owner, on this day. Through this contract, Korea Hydro & Nuclear Power will supply two APR1000 Korean nuclear reactors, each with a capacity of 1,000 MW, to the Dukovany region in the Czech Republic. The total project cost is 407 billion Czech koruna (approximately 26 trillion won). The project owner, EDU II, is 80% owned by the Czech government and 20% by CEZ Group, the Czech power company.

As the main contractor, Korea Hydro & Nuclear Power will provide the full scope of nuclear power plant construction services, including engineering, procurement, and construction (EPC), commissioning, and nuclear fuel supply, in collaboration with Team Korea partners: KEPCO Engineering & Construction (design), Doosan Enerbility (main equipment and construction), Daewoo Engineering & Construction (construction), KEPCO Nuclear Fuel (nuclear fuel), and KEPCO KPS (commissioning and maintenance).

After signing the main contract, Korea Hydro & Nuclear Power plans to sign separate subcontract agreements with these partner companies. Doosan Enerbility stated, "We expect to sign a contract with Korea Hydro & Nuclear Power within this year for the supply of main equipment such as reactors, steam generators, and turbines." For turbines, Doosan Enerbility will sign a separate supply contract with Doosan Skoda Power, a local turbine company in the Czech Republic.

Previously, Korea Hydro & Nuclear Power and Czech EDU II had planned to sign the main contract in early May, but the Brno Regional Court in the Czech Republic accepted an injunction filed by Electricite de France (EDF), a competing bidder, resulting in the cancellation of the main contract. In response, both EDU II and Korea Hydro & Nuclear Power appealed the decision to the Czech Supreme Administrative Court, and as the Supreme Administrative Court overturned the injunction on this day, the contract was able to be signed.

In the main lawsuit, EDF argues that the review should be limited to whether the security exception applies. The main hearing is scheduled for June 25. The Supreme Administrative Court concluded, "Unless there is an objection to the security exception, no prior review can be conducted for other reasons, and therefore, the preliminary measure (injunction) was an incorrect decision."

Although the main lawsuit is still pending, Korea Hydro & Nuclear Power explained that there is no problem with the validity of this main contract. However, depending on the outcome of the main lawsuit, there is still a possibility that new legal disputes could arise. A representative from Korea Hydro & Nuclear Power stated, "While the Brno Regional Court, which is handling the main hearing, will take into account the Supreme Administrative Court's judgment, it still has the authority to present its own legal opinion," adding, "If the Brno Regional Court makes a different judgment from the Competition Protection Office, this case could be referred back to the Supreme Administrative Court."

This Dukovany nuclear power plant contract is being pursued to strengthen the role of nuclear power under the Czech national energy and climate policy's decarbonization strategy, and is the largest project in modern Czech history. Accordingly, there is a possibility that a separate event will be held following the signing of the main contract.

Earlier, in early May, a Korean delegation visited the Czech Republic to sign the main contract. At that time, due to the aftermath of the presidential impeachment, Minister of Trade, Industry and Energy Ahn Deokgeun led the delegation. However, if an event is held after the launch of the new government, there is a possibility that the Czech government may invite President Lee Jaemyung.

Jung Bumjin, President of the Korean Nuclear Society and professor at Kyung Hee University's Department of Nuclear Engineering, said, "Given the significance of this project in the Czech Republic, a separate ceremony may be held," and predicted, "If President Lee Jaemyung attends, it could foster a more positive perception of the nuclear industry."

In particular, the Czech Republic is also planning the Temelin Units 3 and 4 project in the future, so continued interest and support from Korea's new government is needed. The main contract signed by Korea Hydro & Nuclear Power this time concerns Dukovany Units 5 and 6. Korea Hydro & Nuclear Power is also hoping to win additional orders for Temelin Units 3 and 4 in the future.

In July last year, the Czech government and EDU II selected Korea Hydro & Nuclear Power as the preferred bidder, announcing that they would proceed first with the construction of Dukovany Units 5 and 6 and then decide on whether to build Temelin Units 3 and 4. Therefore, if the Czech government decides to build two additional nuclear units at Temelin within the next five years, Korea Hydro & Nuclear Power will be able to sign contracts for Temelin Units 3 and 4 after negotiations with the project owner.

Jung Dongwook, professor at Chung-Ang University's Department of Energy Systems Engineering, stated, "The Czech government plans to expand nuclear power as a key means to achieve carbon neutrality," and added, "To secure additional nuclear orders, the Korean government also needs to continue confirming its support for nuclear power, such as by proceeding with domestic nuclear construction as planned." An industry official emphasized, "Even in the upcoming 12th Basic Plan for Electricity Supply and Demand to be established by the new government, the role of nuclear power must be maintained at a certain level."

This Dukovany nuclear power plant contract is also significant as it is the first case of exporting to Europe. Professor Jung Bumjin explained, "Unlike the Barakah nuclear power plant in the United Arab Emirates (UAE), this project met Europe's stringent labor regulations and industrial safety standards, paving the way for additional exports to other advanced European countries," adding, "It has also opened the door for other industries, such as construction, to enter the European market."

Organizational Chart of the Czech Dukovany Nuclear Power Plant Project Participation. Korea Hydro & Nuclear Power

Meanwhile, Korea Hydro & Nuclear Power and EDU II plan to hold a kick-off meeting before officially launching the project. Korea Hydro & Nuclear Power plans to sign subcontract agreements by field with KEPCO Engineering & Construction, KEPCO KPS, KEPCO Nuclear Fuel, Doosan Enerbility, and Daewoo Engineering & Construction. Korea Hydro & Nuclear Power stated, "To ensure a stable project launch, we have begun establishing a construction information system to manage project documents, permits, and schedules from the negotiation stage," adding, "We also plan to open a construction office at the Dukovany site."

EDU II plans to work with Korea Hydro & Nuclear Power to carry out power plant design, permitting, and various construction preparations, with the goal of starting construction on Dukovany Unit 5 in 2029.

Hwang Jooho, CEO of Korea Hydro & Nuclear Power, stated, "This contract is another achievement that demonstrates the technological prowess and reliability of Korea's nuclear industry on the international stage," adding, "We will enhance the global competitiveness of the domestic nuclear ecosystem and fulfill our responsibility to future generations through safe and sustainable energy."