KEPCO

South Korea has indicted 100 people of corruption and forgery in the scandal over fake safety certifications for parts in its nuclear reactors, authorities said on October 3. The people are from Korea Hydro and Nuclear Power Co (KHNP − which operates the nation's 23 nuclear reactors), from parts suppliers, and from certifiers.[1] A vice president at Korea Electric Power Corp. (KEPCO) and a former KHNP chief executive face bribery charges.[2]

The scandal broke last November after the country's energy ministry ordered the shutdown of two reactors after admissions that eight unnamed firms that supplied parts had faked certificates covering thousands of nuclear power components from 2003 to 2012, affecting at least five reactors. Then in May, it was revealed that four other reactors had components (safety-related control cabling) with forged documentation, prompting the shut down of two reactors for about four months for replacements.[1] Currently, six of the country's 23 reactors are off-line either because of the scandal or scheduled outages.

According to the government's policy coordination ministry, 277 out of 22,000 documents of tests on components at 20 reactors were found to be forged. Of 218,000 documents examined for a further eight units, including five under construction, a total of 2,010 were found to be falsified.[3]

The scandal continues to widen. On October 16, KHNP revealed that control cables at two reactors under construction − Shin Kori 3 and 4 − failed a re-evaluation. Completion of these reactors has been put back by 6−12 months.[1]

Park Young-June, a former deputy minister in charge of energy, has been charged with accepting 50 million won (US$45,000) bribes in 2010 in return for favouring a constructor bidding for a nuclear reactor contract. He is also charged with taking money from Kim Jong-Shin, the one-time chief of KHNP.[4]

In late September, new KHNP chief executive Cho Seok issued a public apology. "Our domestic nuclear project is facing the utmost crisis," he said, adding that public trust had "hit the ground" because of Fukushima and the corruption issues in Korea.[3]

The Atomic Power Review website provides a useful summary of recent events:[5]

"In terms of "will parts with faked certificates actually work," the answer appears in at least one case to be "no," and "do parts supplied under these bribery-induced contracts meet specs," the answer also appears to be "no." Much else has developed in the interim. Let's detail developments in recent times, since it was announced that about 100 people had been indicted overall in the scandal ...

• In early October, it was found that eight nuclear cable suppliers were price fixing; a fine was imposed and a case referred to prosecutors.[6]
• The cable makers were found to have been paying very high dividends − and it was noted that the fine amount was insignificant to deter the practice when compared with the profit derived from a successful bid.[7]
• A large number of faked testing results were discovered in connection with investigation into the corruption scandal, including 277 used to cover parts at operating plants.[8]
• Suspect cables have failed inspections at two reactor plants.[9]
• On October 17 it was revealed that the Korean Government would sue LS Group, which owns JS Cable − the major culprit in supply of suspect cables.[10]
• Another piece hinted that LS Group might sue Korea Hydro & Nuclear Power.[11]
• On October 22, Korea Hydro & Nuclear Power confirmed it would sue LS Group for very significant amounts in damages.[12]"

On October 13, a government working group recommended that nuclear power capacity be kept between 22−29% of total electricity generation by 2035, well below existing plans to grow the sector to 41% in less than 20 years. The government will hold public hearings to decide whether to back the recommendation before finalising its policy in December.[13]

References:
[1] www.powermag.com/s-korea-indicts-100-in-nuclear-graft-scandal-considers-...
[2] www.reuters.com/article/2013/10/10/us-korea-nuclear-idUSBRE99905O20131010
[3] www.world-nuclear-news.org/RS-Indictments_for_South_Korea_forgery_scanda...
[4] http://au.news.yahoo.com/a/-/world/18870327/s-korea-ex-vice-minister-cha...
[5] http://atomicpowerreview.blogspot.com.au/2013/10/south-korea-cables-fail...
[6] http://koreatimes.co.kr/www/news/biz/2013/10/602_144114.html
[7] www.koreaherald.com/view.php?ud=20131020000200
[8] www.koreaherald.com/view.php?ud=20131010000797
[9] www.koreaherald.com/view.php?ud=20131017000948
[10] http://koreatimes.co.kr/www/news/biz/2013/10/602_144514.html
[11] http://koreatimes.co.kr/www/news/biz/2013/10/602_144640.html
[12] http://koreatimes.co.kr/www/news/biz/2013/10/602_144781.html
[13] www.reuters.com/article/2013/10/28/korea-energy-nuclear-idUSL3N0I70G8201...

See also Nuclear Monitor #765, 1 Aug 2013, 'South Korea: Nuclear scandal widens'

The United Arab Emirates dropped a bomb in the nuclear energy world by choosing South-Korean nuclear technology over western reactors. Market analysts and company strategists need to swiftly adapt to a new nuclear market outlook. Following this serious setback, the French nuclear giant AREVA now considers to sell generation-two reactors to countries that are new to nuclear power, even though safety standards in Western countries would not allow these old designs to be built.

Greenpeace International - The US$20 billion (14.2 billion Euro) tender for four reactors in UAE was highly contested, with GE/Hitachi and a French consortium of AREVA, GDF Suez, Total and EDF competing with the South-Koreans to build the first Arab nuclear power reactor. The South-Korean reactors were selected over France’s nuclear flagship the EPR (European Pressurized-water Reactor), and AREVA is now picking up the pieces after this rather humiliating defeat in Abu Dhabi.

Though the low costs of the South-Korean reactors are generally thought to be the main driver behind UAE’s choice, other factors have played a significant role. Serious delays and cost overruns at the first EPR under construction in Olkiluoto, Finland, have shed doubts on AREVA’s ability to live up to its promises. Also the more and more public row between AREVA and EDF, the other French nuclear company, has not helped in securing the billion dollar bid in UAE. EDF was requested to join the EPR consortium that ran in the UAE tender, but was, according to AREVA CEO Anne Lauvergeon, too late in responding. The nuclear power struggle between the French giants has since deepened, the companies disputing uranium enrichment and nuclear fuel processing. See box at end of this article

The South-Korean government and KEPCO, the company leading the consortium in the UAE bid, seemed to relish in the unexpected triumph. The first nuclear power plant in the Arab Gulf will be the first nuclear reactor exported from South-Korea. The South Korean government immediately fantasizes of expanding its nuclear industry, targeting a 20 percent share of the global nuclear reactor market by 2030 through exports of 80 nuclear reactors. The KEPCO reactor is an updated second-generation 1,400 MW light water reactor APR-1400 (Advanced Pressurised Reactor), of which the first two are currently under construction in its home country.

The UAE decision sparked an internal review of AREVA’s product range. The company considers reintroducing second-generation 1,000 MW reactors for client countries that are new to nuclear power. These reactors will be cheaper and less sophisticated than the third-generation EPR reactor that has been marketed aggressively by France all over the world.

According to a senior AREVA executive, ‘safety standards in the US and Europe would not allow a second-generation reactor to be build’. However, this does not stop France to consider selling the older, simpler designs to countries without any previous nuclear experience. The French president Sarkozy even endorses the need to broaden the array of nuclear offerings in order to prevent further failures to win deals: "There is no doubt that we need to restructure the sector and there is no doubt that we need to raise the issue of coming up with a broader set of offers."  AREVA estimates that 20 per cent of the global market could be open to second-generation reactors. Rumors suggest EDF may take the lead in selling these reactors in markets new to nuclear energy.

Sources: Financial Times, 14 & 19 January 2010 / The Times, 18 January 2010 / Nuclear News Flashes 13 January 2010 / Reuters, 22 January 2010 / Greenpeace Nuclear Reactor weblog 7 December 2009.

Contact: Rianne Teule,  Nuclear campaigner Greenpeace International. 

Nuclear turbulence.

The sibling rivalry between the French nuclear giants AREVA and EDF has become a public fight, with the French prime minister Fillon acting as referee. The ego’s of the companies’ CEO’s, Anne Lauvergeon for AREVA and Henry Proglio for EDF, seem too big for one room, and media jump eagerly on each blaming the other for failing to keep promises and responsibilities. The pot calling the kettle black..…

AREVA blames EDF for signing a contract for enrichment services with the Russian company Tenex. EDF seeks to diversify its supplies of nuclear fuel from non-French enrichment suppliers like the Anglo-German-Dutch Urenco and Tenex, instead of continuing to take uranium from the French enrichment facility Eurodif. Eurodif still uses gas diffusion technology, while the new Georges Besse II centrifuge enrichment plant is planned to be fully operational only in 2012. Unless EDF agrees to buy services from the Eurodif diffusion plant after 2009, AREVA could be forced to cancel the scheduled initial production in the new Georges Besse II plant. Though this might be an empty threat, it is clear that AREVA needs EDF to buy enrichment services in order to make a smooth transfer from gas diffusion to the new centrifuge plant. A committee of AREVA officials have denounced EDF’s uranium contracts with the Russians as ‘non-patriotic’ and ‘anti-European’.

On top of that, in the beginning of January 2010 AREVA has stopped removing spent nuclear fuel from reactors for reprocessing at the facility in La Hague, Normandy. EDF and AREVA have not been able to agree on a new contract to continue reprocessing of spent fuel from EDF’s nuclear power plants. The new reprocessing contracts have been disputed for many months without any progress. The previous contract to reprocess spent nuclear fuel at La Hague, which expired in 2008, was worth 800 million Euro (US$1.15 billion) per year. At the end of 2008, the companies agreed on a framework for contracts for the 2008-40 period, but since mid-2009 have not been able to settle disagreements over prices and volumes.

The French nuclear row plays in a setting in which the whole nuclear sector in France is challenged on its transparency on nuclear waste issues. The documentary 'Waste, the nuclear nightmare', aired in October 2009, has sparked a national debate on nuclear waste in France. The High Committee for Transparency and Information on Nuclear Safety (HCTISN) conducts a full inventory of France’s nuclear waste products and transports. Greenpeace has blocked uranium transports to Russia several times, calling for a moratorium on the waste transports to Russia.