KHNP Becomes First Public Enterprise to Launch Full-Scale SMR Business
Collaboration on the World’s First Commercial SMR Plant and Expansion of the Global SMR Supply Chain
Integrated Energy Solutions for Power Supply in the AI Industry
SK Innovation is transferring part of its stake in TerraPower, a U.S.-based next-generation Small Modular Reactor (SMR) developer, to Korea Hydro & Nuclear Power (KHNP), and the three companies are strengthening their collaboration to target the global SMR market.
From the left, Muhwan Kim, Head of Energy Solutions Division at SK Innovation, Insik Park, Head of Export Business Division at Korea Hydro & Nuclear Power, and Chris Levesque, Chief Executive Officer (CEO) of TerraPower, are strengthening their commitment to the Small Modular Reactor (SMR) alliance. SK Innovation
On January 21, SK Innovation announced that it had completed the sale of a portion of its TerraPower shares to KHNP. This marks the first time a domestic energy public enterprise has directly invested in a world-leading SMR developer.
TerraPower, founded by Bill Gates in 2008, is building the world’s first commercial SMR plant in Wyoming, United States, scheduled for completion in 2030, using next-generation Natrium reactor technology combined with gigawatt-scale energy storage systems. TerraPower’s SMR, known for its advanced technology, high safety, and eco-friendliness, is being highlighted as a game changer in resolving the power shortages faced by the rapidly expanding artificial intelligence (AI) industry.
SMRs, with their modular design, can significantly reduce construction time and costs, while also allowing for rapid, phased expansions to meet surging electricity demand. Their ability to provide stable, 24-hour power makes them an optimal solution for industries requiring large-scale power infrastructure, such as AI data centers.
In particular, TerraPower’s Natrium SMR technology enables load-following operations, allowing flexible adjustment of power output in response to electricity demand by utilizing energy storage devices. This provides a distinct advantage over other SMR technologies, as it creates strong complementary synergies with highly variable renewable energy sources.
In December of last year, KHNP successfully passed the Committee on Foreign Investment in the United States (CFIUS) review regarding its acquisition of TerraPower shares, establishing the institutional foundation for participation in the global SMR market. SK Innovation and SK Inc. jointly invested $250 million (approximately 369.95 billion won) in TerraPower in August 2022, becoming the second-largest shareholders, and will maintain this position even after the partial sale of shares.
SK Innovation, KHNP, and TerraPower signed a "SMR Development and Demonstration Business Agreement" in April 2023, initiating cooperation to expand the global SMR supply chain. Following KHNP’s investment, the three companies plan to sequentially sign main business contracts for additional SMR construction projects in the U.S. and abroad, as well as for the introduction of SMRs in Korea.
SK Innovation intends to combine its accumulated global competitiveness in energy and materials with KHNP’s expertise in nuclear power plant construction and operation to establish an SMR ecosystem across various industries, including domestic and international data centers. The company aims to provide customized, integrated energy solutions to address the power supply challenges of the AI industry.
Muhwan Kim, Head of the Energy Solution Business Unit at SK Innovation, stated, "With KHNP joining as an investor in TerraPower, the three-way global SMR business partnership has become more concrete. SK Innovation will work closely with KHNP to support the Wyoming project, advance into overseas SMR markets, and achieve innovative results in areas such as localization of materials and components."
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