Korea Electric Power Corporation and Korea Hydro & Nuclear Power have reached a settlement with the U.S. company Westinghouse over an intellectual property (IP) dispute, agreeing to pay $175 million (about 240 billion won) in royalties per exported nuclear power plant over the next 50 years, eliciting mixed reactions.
Some in the political sphere argue that the royalties to be paid over 50 years constitute a slave contract, while those in the nuclear power industry contend that, considering the business cycle of nuclear plants, the amount is not excessive.
A representative from the nuclear power industry said on the 21st, "While 50 years is a long time, nuclear plants are not products that can be made in a short period, so we need to consider the uniqueness of nuclear power," adding that "even if KHNP operates multiple projects in several countries simultaneously, (50 years) provides a window to challenge for contracts a maximum of 4 to 5 times."
Around KHNP, the "Team Korea" secured the main contract for the construction of two units at the nuclear power plant in Dukovany, Czech Republic, last June. KHNP began pursuing the project in the Czech Republic in 2006, assembling a project team and dispatching a local service group, dedicating several years to the bidding process.
The Dukovany nuclear power plant project in the Czech Republic has taken nearly 20 years from its initiation to the main contract, with a target completion date of 2036, meaning it will take about 30 years from start to finish.
Currently, KHNP is not participating in any nuclear power construction bids, but has signed memorandums of understanding (MOU) for large nuclear power and small modular reactor (SMR) projects with the Philippines, Uganda, Indonesia, Sweden, Norway, and Thailand. A KHNP representative noted, "It is unclear when the countries that signed the MOUs will actually push for bids."
In the nuclear power sector, it is viewed that the agreement with Westinghouse has made independent exports more challenging in certain areas such as the U.S. and Europe, but the possibility for Korea and the U.S. to collaborate in market development has increased. In particular, the U.S. has declared a nuclear renaissance, planning to build 10 nuclear plants domestically by 2035, making cooperation with the U.S. necessary, with over 100 trillion won being injected into this initiative.
A representative from the nuclear power industry remarked, "In the context of U.S.-China and U.S.-Russia tensions, Korea is nearly the only country capable of leading the nuclear renaissance with the U.S.," suggesting that cooperation between Korea and the U.S. is likely to strengthen.