Shanghai Workshop:A Nuclear Weapon-Free Zone and Missile Control in Northeast Asia

Shanghai, China, July 16 (Fri), 2004 – July 18 (Sun), 2004

Nuclear Free Korean Peninsula and Energy Support: Regional Power Grid Interconnections for the Korean Peninsula

Jungmin KANG,

Ph.D., Seoul Based Nuclear Analyst

Introduction

The third round of six-party talks was held in Beijing during June 23-26, 2004 with agreement to resume discussions by the end of September in Beijing. Even though the six parties stressed the need to take first steps toward de-nuclearization of the Korean peninsula as soon as possible, big differences remain between the United States and DPRK over the scope of a nuclear freeze, its verification and other related measures. About the energy issue, the United States agreed to propose other parties – ROK, Japan, China or Russia – provide energy assistance to the DPRK if DPRK would agree to commit to the dismantlement of its nuclear program. The ROK also offered to provide heavy fuel oil aid to the DPRK as part of compensation for a freeze and then quick dismantlement of the DPRK nuclear program. However, no breakthrough is expected in the US-DPRK nuclear deal due to serious lack of mutual trust. The five parties except DPRK need to consider a new strategy to have DPRK go de-nuclearization by first providing energy support to the DPRK. The energy support to the DPRK from the other parties could result positive effect in resolving the DPRK nuclear conundrum since it could contribute to reduce political tension around the Korean peninsula. The energy support to the DPRK can be achieved not only by direct energy assistance to the DPRK but also by indirect royalty payments for permission to pass through the DPRK’s territory in the course of regional energy cooperation for the Korean peninsula. Two possible alternatives of the regional energy cooperation for the Korean peninsula are as follows: electricity interconnections between the Russian Far East (RFE) and the ROK, passing through the DPRK with some electricity used in the DPRK; and a pipeline bringing natural gas from North Sakhalin in the RFE to the ROK, with some gas used in the DPRK. This study analyses environmental and economic benefits of the ROK and the RFE as well as the DPRK stemmed from ROK-DPRK-RFE power grid interconnection.

Opportunities and Challenges of the Regional Energy Cooperation

It is imperative to ensure energy security for the welfare of country. Heavy energy-consuming but scarce energy resources countries like ROK and Japan have been exposed to energy security threats. The regional energy cooperation could provide various benefits to all participating countries, hence could contribute to increase the energy security of all participating countries by increasing optimal use of existing resources, technology, etc. and by improving energy market efficiency and secure cost-effective energy supply through energy market integration and system interconnection. However, even though the various benefits from the regional energy cooperation, many challenges are anticipated in implementation of the regional energy cooperation in Northeast Asia around Korean peninsula. The regional energy cooperation such as power grid interconnections or gas pipeline development among the participating countries requires considerable amount of investment from the participating countries. The political tensions surrounding the Korean peninsula could increase the risk of investment for the energy cooperation in the region. Besides this, institutional obstacles would be anticipated among the participating countries for energy cooperation.

Regional Power Grid Interconnection for the Korean Peninsula

The advantage of regional power grid interconnections are as follows: reduction of capacity reserve for the future so as to save the investment cost; reduction of operating reserve so as to reduce the operating cost; resolve the location problem; resolve the environmental problem; etc. Hence, the regional power grid interconnections bring economical as well as environmental benefits to all participating countries. However, there are also many political and technical challenges in realizing the regional power grid interconnections for the Korean peninsula, such as follows: the progress of six-party talks on the DPRK nuclear weapons development; high capital costs and investment risks; no regional financing mechanism; absence of legal systems that deals with different processes for enforcing contracts and resolving dispute; and different technical specifications including different operating voltage and frequency of neighboring power grids. However, these challenges could be surmountable if the participating countries have strong will to implement the regional power grid interconnections for their own sakes.

There are some existing regional power interconnections worldwide. The largest regional power grid interconnection in the world is located in Europe: unification of national energy systems of western European countries interconnected with central European international power system; and interconnected national grids of north European countries. Besides those, where is also power grid interconnection between Canada and the United States, which connect cascades of Canadian hydro power stations with the US electricity consumers, and among the ASEAN countries.

ROK-DPRK-RFE Power Grid Interconnection

As one alternatives of the regional power grid interconnection for the Korean peninsula, the electricity transmission interconnection between the RFE and the ROK, passing through the DPRK would allow the RFE to export power generated at existing and new hydro power stations to the ROK. David von Hippel of Nautilus Institute estimated the capacity of the line could be up to 3 GWe and be activated in 2010, and would cost about $2.5 billion. This line could serve to allow two pressurized water reactors (PWRs) that were under construction by the Korean Peninsula Energy Organization (KEDO) at Sinpo in the DPRK to be operated safely.

Benefits of RFE

The RFE will be the major source of energy resources such as electricity as well as gas exported to the ROK via the DPRK. Recently, the RFE has been expressing that it wants to supply electricity and gas through the DPRK to the ROK. As of the end of 2003, installed capacity of electricity of RFE is 7.2 GWe and is estimated about 9.1 GWe in 2010. According to a REF analysis in 2004, the RFE could supply up to 3 GWe through the DPRK to the ROK using 500 kV transmission line from Vladivostok to Chongjin, northern part of the DPRK, and extension of the transmission line to the border of the ROK and further south. The RFE can get economic benefit for the supply of its abundant electricity to the ROK via the ROK-DPRK-RFE power grid interconnection.

Benefits of DPRK

Suffering serious energy shortage, the DPRK recently has been shown an aggressive attitude in participating in the ROK-DPRK-RFE power grid interconnection. Park Sung-Hui, a delegate of the DPRK said at a forum held in Seoul in May 2004 to discuss a power-sharing arrangement in Northeast Asia: The DPRK was already building a new power-sharing system with Russia; Connecting the system with the power grid in the ROK would make the sharing more successful; and, The relevant governments should discuss actual action plans to realize the regional power network. Upon participating in the ROK-DPRK-RFE power grid interconnection, the DPRK would receive either an annual lump-sum or some amount of electricity agreed-upon per-kWh-transferred payment for hosting the transmission line.

Benefits of ROK

The ROK will be the major recipient of electricity and gas imported from the RFE via the DPRK. The ROK government showed an interest in the power sharing arrangement for the Korean peninsula which will benefit to all countries in the region at the Seoul forum of May 2004. Since the ROK have difficulty in building new power plants in its land due to strong objects by local communities that concern environmental impacts, the ROK would be able to take advantage of the RFE’s electricity supply to meet its surging energy demand as well as to obtain environmental and economic benefits.

Since the first commercial operation of a nuclear power plant (NPP) in the ROK in 1978, the ROK has placed fourteen units of PWRs and four units of CANDU (Canadian Deuterium Uranium) reactors in operation. These units have a total electricity generation capacity of 15.7 GWe, and supplied 38.9% of the total electricity generated in the nation as of the end of July 2003. Two more PWRs are under construction, with eight additional PWRs to be deployed by the year 2015. However, due to strongly growing “anti-nuke” movements by local residents and NGOs, it will be difficult for the ROK to deploy all the planned PWRs by 2015. Furthermore, there is no site designated for two PWRs that are planned to be deployed in 2014 and 2015 and even for thermal power plants after 2015. It would be likely to assume that more than two PWRs might not be deployed as originally planed in the ROK by 2015 or after then. Therefore, the ROK should seriously consider how to complement its electricity deficiency more than 2 GWe before and after 2015. And the RFE’s electricity supply to the ROK utilizing ROK-DPRK-RFE power grid interconnection could be an alternative to meet the ROK’s electricity demand before and after 2015.

If the ROK import the electricity generated from 2 GWe of capacity in the RFE via ROK-DPRK-RFE power grid interconnection, it could replace the deployment of two 1 GWe PWRs, and as such could provide environmental and economic benefits to the ROK by reducing the generation of nuclear wastes such as spent nuclear fuel and Low and Intermediate Level Waste (LILW), as well as decommissioned reactors.

Estimates of the annual amount of spent fuel discharges are calculated as follows.

,

where:

SF_t = annual amount of spent nuclear fuel discharged in year t (tHM),

NC_t = net nuclear capacity in year t (MWe, 1GWe =1,000MWe),

CF_t = capacity factor in year t,

TE_t = thermal to electrical efficiency in year t, and

BU_t = average discharge burnup in year t (MWd/tHM).

Assuming 1 GWe of nuclear capacity, 90% of capacity factor, 34.9% of average thermal efficiency, and 44,000 MWd/tHM of average burnup, the annual amount of spent fuel discharged from 1 GWe PWR is 21.4tHM. The 1 GWe PWR would discharge about 856 or 1,284 tHM of spent fuel during its lifetime of 40 or 60 years, respectively. The average annual volume of low and intermediate level of radioactive waste (LILW) discharged from 1 GWe PWR in the ROK is about 28 m³. The 1 GWe PWR would discharge about 1,120 or 1,680 m³ of LILW during its lifetime of 40 or 60 years, respectively. The weight of radioactive waste arising from decommissioning of the 1 GWe PWR is estimated about 10,000t, according to an OECD/NEA analysis in 2003. Therefore, the electricity supply generated from 2 GWe of capacity in the RFE to the ROK will provide environmental benefit to the ROK by reducing the twice amount of those hazardous radioactive wastes discharged during the operation and after shutdown of the 1 GWe PWR.

Cost savings related to the storage and disposition of those radioactive wastes are anticipated for the case in which there is no deployment of two 1 GWe PWRs in the ROK. This study assumes that the unit cost for storage and disposition of PWR spent fuel, decommissioning of PWR, and disposition of LILW are 100-200USD/kgHM, 320 million USD per a 1 GWe PWR, and 1,600-3,200USD/ m³ LILW, respectively. Based on the above cost assumptions, the cost savings relating to the nuclear wastes generation for the case of no deployment of 1 GWe PWR are approximately 1.0-1.1 billion USD or 1.4-1.5 billion USD (total undiscounted costs) for its lifetime of 40 or 60 years, respectively. Therefore, the electricity supply generated from 2 GWe of capacity in the RFE to the ROK will provide economic benefit to the ROK by saving the twice amount of those above cost savings. Moreover, the ROK can save construction cost of the two 1GWe PWRs. The construction cost of 1 GWe PWR is about 1.6 billion USD.

If we assume that the import of the electricity generated 2 GWe of capacity in the RFE could replace the electricity generated the same capacity of thermal power plants in the ROK, it would provide reduction of air pollutants (such as SO₂, NO_x and particulate) and greenhouse gas (such as CO₂) emissions, as well as avoided power facility location problem in the ROK. Sergei Podkovalnikov of Energy Systems Institute of Russian Academy of Sciences estimated in May 2003 that the ROK’s import of the electricity generated 2 GWe of capacity in the RFE could reduce the discharged amount of the air pollutants and greenhouse gas by about 52,000-91,000 and 1,880,000 tonnes per year, respectively, in the ROK.

The ROK-DPRK-RFE power grid interconnection could provide significant environmental and economic benefits to the ROK by allowing a considerable reduction in the amount of generation of nuclear waste—such as spent nuclear fuel, LILW, and waste from decommissioned reactors—as well as by avoiding the deployment of two PWRs.

Conclusions

Even though there are many political and technical challenges in realizing the regional power grid interconnections, the ROK-DPRK-RFE power grid interconnection could bring a win-win opportunity to the ROK, the DPRK and the RFE by providing environmental and economic benefits to all three countries.

Via the implementation of the ROK-DPRK-RFE power grid interconnection, the energy support to the DPRK could improve the DPRK energy situation, involve the DPRK to multilateral energy cooperation system, reduce political tension around the Korean peninsula, and thereby bring a positive effect in resolving the DPRK nuclear conundrum.