"Let's Bring the First Small Modular Reactor to Gyeongju"… POSCO Holdings, North Gyeongsang Province, and Gyeongju City Sign Business Agreement

On August 1, at 4:00 p.m., North Gyeongsang Province will sign a business agreement with Gyeongju City and POSCO Holdings at the POSCO Center conference room in Seoul to collaborate on attracting the first domestic Small Modular Reactor (SMR) to Gyeongju and on utilizing nuclear power from the Wolseong Nuclear Power Plant and other sources.

This agreement aims to foster mutual cooperation for the successful establishment of the first domestic demonstration SMR in Gyeongju, as included in the 11th Basic Plan for Long-term Electricity Supply and Demand, as well as for the successful development of the nearby Gyeongju SMR National Industrial Complex. It also seeks to explore ways to utilize nuclear power to realize hydrogen-based steelmaking, a carbon-neutral technology in the steel industry.

Gyeongbuk Provincial Government Building

Through this agreement, the three parties have committed to closely cooperate on attracting the first domestic demonstration SMR to Gyeongju, investing in the Gyeongju SMR National Industrial Complex, and establishing a supply plan for nuclear power to realize hydrogen-based steelmaking.

Recently, North Gyeongsang Province and Gyeongju City have been striving to revitalize the nuclear industry by focusing on Small Modular Reactors (SMRs), which offer significantly enhanced safety compared to large-scale nuclear plants and meet high industrial demand for compact reactors. They are also actively pursuing the establishment of the Gyeongju SMR National Industrial Complex to cluster advanced industries, the construction of a manufacturing support center, and the founding of the Munmu Daewang Science Research Institute, a dedicated SMR research institution, as part of their industrial development efforts.

In particular, they are making every effort to attract the first domestic demonstration SMR to Gyeongju and to ensure the successful development of the Gyeongju SMR National Industrial Complex utilizing nuclear power. Therefore, signing a business agreement with POSCO Holdings, the largest domestic consumer of electricity and hydrogen, is highly significant for industrial development in terms of both industrial demand and supply.

POSCO, a global steel company headquartered in Pohang, North Gyeongsang Province, and ranked seventh worldwide in crude steel production capacity, has played a pivotal role in Korea's industrial modernization. However, it is currently facing international challenges such as strengthened U.S. steel tariffs and the European Union's carbon border tax barriers. As a solution, POSCO is striving to transition to a hydrogen-based steelmaking process utilizing nuclear power, which is a carbon reduction process.

Hydrogen-based steelmaking is a carbon reduction technology that uses hydrogen, instead of coal or natural gas, as a reducing agent to remove oxygen from iron ore and produce molten iron in an electric furnace. This technology can dramatically reduce carbon emissions generated in the steel production process.

To utilize this technology, it is essential to supply carbon-free or low-carbon thermal energy at 1,538 degrees Celsius to melt iron. The biggest challenge is cost. The key to successful hydrogen-based steelmaking is to secure a stable and inexpensive carbon-free power source 24 hours a day, and currently, nuclear power is the only viable energy source that can meet this requirement.

According to steel and energy industry officials, major countries such as the European Union and Japan are already implementing active support policies to promote the decarbonization of the steel industry. In particular, hydrogen-based steelmaking requires massive amounts of electricity, which cannot be supplied solely by intermittent renewable energy sources. Therefore, they emphasize the need for the government to actively improve policies so that the private sector can utilize nuclear power through power purchase agreements (PPAs).

Yang Geumhee, Vice Governor for Economic Affairs of North Gyeongsang Province, stated, "Decarbonization of the steel industry is not a choice but a necessity, and as a core element for achieving the national carbon reduction target, it is now time for the government to establish an institutional foundation." She added, "We will strengthen cooperation with POSCO and Small Modular Reactors (SMRs), which are responsible for the regional economy, and actively support the transition to carbon reduction processes using nuclear power."