{"id":2202310,"date":"2023-09-20T17:52:24","date_gmt":"2023-09-20T08:52:24","guid":{"rendered":"https:\/\/koreapro.org\/?p=2202310"},"modified":"2023-09-21T17:35:45","modified_gmt":"2023-09-21T08:35:45","slug":"unresolved-westinghouse-lawsuit-clouds-south-koreas-nuclear-export-plans","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2023\/09\/unresolved-westinghouse-lawsuit-clouds-south-koreas-nuclear-export-plans\/","title":{"rendered":"Unresolved Westinghouse lawsuit clouds South Korea\u2019s nuclear export plans"},"content":{"rendered":"

The U.S. District Court for the District of Columbia <\/span>dismissed<\/span><\/a> on Tuesday Westinghouse Electric Company\u2019s lawsuit against its South Korean competitors, Korea Hydro & Nuclear Power (KHNP) and Korea Electric Power Corp. (KEPCO). The court stated that Westinghouse lacked the standing to sue over enforcing a U.S. <\/span>export control regulation<\/span><\/a>. At first glance, this might boost South Korea\u2019s drive to lead in the nuclear export market.<\/span><\/p>\n

However, the court sidestepped a definitive decision on whether the APR1400 reactor technology South Korea exported to the United Arab Emirates (UAE) either integrates Westinghouse\u2019s proprietary technology or is a product of South Korea\u2019s independent development efforts. This lack of clarity paves the way for Westinghouse to <\/span>appeal<\/span><\/a> the court\u2019s decision and might put South Korea\u2019s burgeoning nuclear export ambitions at risk.<\/span><\/p>\n

The ROK government might find this unresolved intellectual property disagreement discouraging for potential international partners considering deals with Korean firms.<\/span><\/p>\n

As KHNP and KEPCO explore exporting nuclear reactors to <\/span>Poland<\/span><\/a>, Westinghouse has contended that these reactors infringe upon their intellectual property, claiming they utilize Westinghouse technology. Westinghouse asserted that due to the involvement of an American firm, KHNP and KEPCO must seek U.S. government clearance to transfer reactors to international markets.<\/span><\/p>\n

KHNP and KEPCO continue to counter Westinghouse\u2019s claim and maintain that their reactors have no significant connection to Westinghouse. They contend that, despite previous collaborations with the American firm, the core technology of their APR1400 nuclear reactors originates from Korea, making them distinct from Westinghouse\u2019s proprietary technology and exempt from U.S. export regulations.<\/span><\/p>\n

This unresolved decision by the U.S. court suggests that the U.S. might still intervene and obstruct South Korean exports of nuclear reactors as it did when the U.S. Department of Energy <\/span>responded unfavorably<\/span><\/a> to KHNP\u2019s report on a nuclear power project in the Czech Republic. Further, a subsequent case that delves deeper into intellectual property issues could potentially find the Korean firms in violation of Westinghouse\u2019s rights.<\/span><\/p>\n

If either scenario materializes, it would pose a significant setback for the ROK\u2019s goal of becoming a leading nuclear exporter.<\/span><\/p>\n

NUCLEAR AMBITIONS AND DIPLOMACY<\/b><\/p>\n

Since his election in May 2022, South Korean President Yoon Suk-yeol has spotlighted the economic promise of nuclear exports. In July, he <\/span>undertook<\/span><\/a> a three-day tour of Poland, joined by a substantial delegation of business executives and government representatives.<\/span><\/p>\n

The trip culminated in the signing of six memorandums of understanding pertaining to nuclear power. Notably, Doosan Enerbility, based in Changwon, finalized an <\/span>agreement<\/span><\/a> with multiple Polish firms to erect new nuclear facilities in the country. Additionally, Hyundai Engineering Company <\/span>entered<\/span><\/a> a preliminary contract with a Polish entity to foster nuclear power development in the Eastern European nation.<\/span><\/p>\n

Yoon\u2019s visit to Poland came on the heels of a diplomatic sojourn to the Middle East in January. During this visit, the ROK and the UAE <\/span>committed<\/span><\/a> to \u201cdeepen and accelerate collaboration in the peaceful nuclear energy sector.\u201d<\/span><\/p>\n

Yoon <\/span>toured<\/span><\/a> the $20 billion Barakah nuclear facility in Abu Dhabi, a project featuring the disputed APR1400 reactors. Once fully operational, this facility will fulfill nearly 25% of the emirate\u2019s energy requirements. Yoon later <\/span>remarked<\/span><\/a> that the Barakah initiative epitomizes a \u201cnew model of cooperation,\u201d showcasing the potential of South Korea\u2019s nuclear sector in global markets.<\/span><\/p>\n

In Aug. 2022 \u2014 just two months before Westinghouse filed its lawsuit, the ROK <\/span>ventured<\/span><\/a> into the Egyptian market, with KHNP securing a $2.5 billion contract to build Egypt\u2019s inaugural nuclear power station. South Korea has also made similar bids to other nations like the <\/span>Czech Republic<\/span><\/a> and <\/span>Saudi Arabia<\/span><\/a>.<\/span><\/p>\n

Yet the ongoing legal dispute with Westinghouse could be a stumbling block. International collaborators may opt for caution, awaiting clarity on the Westinghouse case before cementing any new agreements with the ROK. While Yoon has set an ambitious <\/span>goal<\/span><\/a> of building 10 nuclear reactors overseas by 2030, realizing this vision hinges on favorable legal outcomes for Korea.<\/span><\/p>\n

\"\"

Saeul Nuclear Power Plant, July 6, 2022 | Image: Korea Hydro & Nuclear Power<\/a><\/em><\/p><\/div>\n

DOMESTIC ENERGY NEEDS<\/b><\/p>\n

Despite legal uncertainties clouding South Korea\u2019s nuclear export prospects, the government remains undeterred in its commitment to nuclear power domestically. Elected during a period when fossil fuels and liquefied natural gas (LNG) prices <\/span>soared<\/span><\/a> due to Russia\u2019s invasion of Ukraine, Yoon envisions nuclear power as a solution to some of South Korea\u2019s economic challenges.<\/span><\/p>\n

Comparing energy costs reveals that nuclear power significantly undercuts other sources. One kilowatt hour (kWh) of nuclear power <\/span>costs<\/span><\/a> an average of $0.05 (61.5 won), while coal, solar and natural gas are priced at $0.07 (96 won), $0.11 (149.9 won) and $0.13 (170 won) per kWh, respectively. An amplified supply of this affordable energy could catalyze profound economic shifts in Korea.<\/span><\/p>\n

Expanding inexpensive nuclear energy could substantially reduce expenses for consumers and businesses. For instance, electricity derived from nuclear power, when juxtaposed against gas, might offer savings of up to 60%. These reduced electricity rates gain even more significance against a <\/span>backdrop<\/span><\/a> of mounting inflation and escalating interest rates, which compound financial strains.<\/span><\/p>\n

Last June, the South Korean government felt compelled to <\/span>hike<\/span><\/a> electricity prices by $0.004 (5 won) per kWh, attributing this to LNG and coal prices surging, which fueled inflation. With Seoul <\/span>importing<\/span><\/a> nearly 98% of its fossil fuel, it remains vulnerable to price fluctuations in the global market \u2014 factors beyond its control. A pivot toward energy self-sufficiency would insulate the nation from imported inflation and bolster its businesses to compete more effectively.<\/span><\/p>\n

Emphasizing nuclear power\u2019s potential domestically and internationally, Yoon <\/span>announced<\/span><\/a> in April a sizable $515 million (675 billion won) investment to fortify the capacities of domestic nuclear energy corporations. This government-backed confidence mirrors the stock performance of industry players. For instance, Doosan Enerbility has seen its stock <\/span>surge<\/span><\/a> by over 17% on the Korea Exchange this year, and KEPCO Engineering has <\/span>appreciated<\/span><\/a> by more than 23%.<\/span><\/p>\n

While Korean nuclear power companies are poised for a more significant domestic role, their global expansion remains uncertain. Much depends on the outcome of KHNP and KEPCO\u2019s legal skirmish with Westinghouse. The stance of U.S. courts and government could make or break South Korea\u2019s aspiration to solidify its stature as a global nuclear export heavyweight.<\/span><\/p>\n

Edited by John Lee<\/span><\/i><\/p>\n

Business & Economy<\/span><\/a>Inter-Korean & Foreign Relations<\/span><\/a><\/div>","protected":false},"excerpt":{"rendered":"

The U.S. District Court for the District of Columbia dismissed on Tuesday Westinghouse Electric Company\u2019s lawsuit against its South Korean competitors, Korea Hydro & Nuclear Power (KHNP) and Korea Electric Power Corp. (KEPCO). The court stated that Westinghouse lacked the standing to sue over enforcing a U.S. export control regulation. At first glance, this might […]<\/p>\n","protected":false},"author":10407,"featured_media":2202311,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[24,28],"class_list":["post-2202310","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","tag-business-economy","tag-inter-korean-foreign-relations"],"yoast_head":"\nUnresolved Westinghouse lawsuit clouds South Korea\u2019s nuclear export plans - KOREA PRO<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/koreapro.org\/2023\/09\/unresolved-westinghouse-lawsuit-clouds-south-koreas-nuclear-export-plans\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Unresolved Westinghouse lawsuit clouds South Korea\u2019s nuclear export plans - KOREA PRO\" \/>\n<meta property=\"og:description\" content=\"The U.S. District Court for the District of Columbia dismissed on Tuesday Westinghouse Electric Company\u2019s lawsuit against its South Korean competitors, Korea Hydro & Nuclear Power (KHNP) and Korea Electric Power Corp. 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