© Archyde.com. Lost 10.8 cents in 5 years because of nuclear phase out… Increased LNG power generation, soaring electricity purchase costs
The Ministry of Trade, Industry and Energy estimates that the cumulative loss caused by the Moon Jae-in government’s nuclear phase-out policy exceeds 10 trillion won in electricity purchase costs alone. It is said that KEPCO and other companies paid a higher cost when purchasing electricity by reducing the operation of nuclear power plants with low power generation costs and replacing them with liquefied natural gas (LNG) power generation with expensive fuel prices.
According to the ‘Estimated cost of power purchase due to nuclear phase out’ submitted by the Ministry of Trade, Industry and Energy on the 4th by Kwon Myung-ho, the People’s Power lawmaker, the amount of electricity purchase cost loss that occurred over five years from 2017, when the last government’s nuclear phase-out policy in earnest, to July of this year. is worth 10.77 trillion won in total. This is the first time that the government has estimated the loss of nuclear power plants.
If the amount of nuclear power generation was less than 29.7% (the share of nuclear power generation in 2016), the Ministry of Industry and Energy estimated the loss assuming that the difference was replaced by LNG power generation. It is a number multiplied by the difference between the average fuel cost of nuclear power plants and the LNG settlement unit price at the time.
In 2017, the first year of denuclearization, the share of nuclear power generation out of 576,412 GWh (1GWh = 1 million kWh) of total power generation was 26.8%, which was 2.9 percentage points lower than that of nuclear power plants in 2016. This means that 16,716 GWh, which should have been generated by nuclear power plants, was replaced with other power generation. At this time, the LNG settlement unit price was 111.6 won/kWh, and the nuclear power plant was 5.7 won/kWh, with a difference of 105.9 won per kWh. In the end, the loss calculated by multiplying the difference between the nuclear power plant fuel cost and the LNG settlement unit price of 105.9 won by 16,716 GWh, which was lower than originally expected, was 1.77 trillion won.
According to the same calculation method, losses of 4.3 trillion won in 2018, 2.51 trillion won in 2019, 370 billion won in 2020, and 1.6 trillion won in 2021 were estimated. This year, it lost 210 billion won until July.
This year, the proportion of nuclear power generation exceeded 29%, resulting in a loss of only 1040GWh, but the estimated loss of power purchase cost reached 210 billion won. As the LNG settlement price soared to 204.9 won, the difference from the nuclear power plant fuel cost (6.4 won) became 198.5 won, resulting in a larger loss. In 2017, the LNG settlement unit price was 111.6 won and the nuclear power plant fuel cost was 5.7 won, with a difference of 105.9 won. However, from January to July 2022, the fuel cost of nuclear power plants rose by 0.7 won to 6.4 won, and the LNG settlement unit price rose 93.3 won to 204.9 won during the same period. This means that if an LNG power plant is operated instead of a nuclear power plant, a loss of close to 200 won per kWh will occur.
It is predicted that LNG prices will surge again this winter due to the aftermath of the Russian-Ukraine war. Accordingly, it is pointed out that it is necessary to minimize the factors that increase the electricity rate by increasing the proportion of operation of nuclear power plants.
When asked about the cause of KEPCO’s deficit at the National Assembly’s National Assembly’s Committee on Industry, Trade, and Resources Small and Medium Venture Business on the same day, Minister of Trade, Industry and Energy Lee Chang-yang said, “If the ratio of power sources with low power generation costs, such as nuclear power plants, had been high in the power mix (composition ratio), the high energy prices would be The impact would have been reduced.”
As KEPCO expected an annual operating loss of up to 40 trillion won this year, starting this month, it raised electricity rates by 7.4 won per kWh for home use and up to 16.6 won for industrial use.
Rep. Kwon Myung-ho said, “We need to immediately abolish nuclear power plants that have harmed the people and establish the 10th Basic Plan for Electricity Supply and Demand in line with the reality of Korea as soon as possible.”
In August, the government unveiled the draft of the 10th basic electricity supply and demand plan, which includes the electricity supply and demand plan for 2022-2036. The draft includes content to increase the proportion of nuclear power plants to 32.8% of total power generation by 2030. This is 8.9 percentage points higher than that of the Moon Jae-in administration at the end of last year, which set the ratio of nuclear power generation to 23.9% in 2030 in the National Greenhouse Gas Reduction Target (NDC).
Correspondent Kim So-hyun [email protected]
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