Korea Hydro & Nuclear Power (KHNP) was selected as the preferred bidder for the 24 trillion won Czech nuclear project last month, but the follow-up process is facing delays due to objections from the United States. While there were high expectations for this record-breaking nuclear export contract, the U.S.-based Westinghouse Electric Company is hindering progress by alleging that the Korean reactor design infringes on its proprietary technology. Negotiations between South Korea and the U.S. have also stalled. Under the guidelines of the Nuclear Suppliers Group (NSG), established in 1978, South Korea needs Westinghouse’s consent to export nuclear reactors. The procedure was smoothly handled during the 2009 Barakah plant deal in the United Arab Emirates (UAE), but Westinghouse is now raising intellectual property concerns regarding the Czech project and refusing to give consent. The U.S. Department of Energy (DOE) has declined involvement, stating that the dispute is a matter between KHNP and Westinghouse.
According to a senior South Korean government official on Aug. 23, a delegation consisting of Minister of Trade, Industry and Energy Ahn Duk-geun, Korea Electric Power Corporation (KEPCO) President Kim Dong-cheol, and KHNP President Hwang Joo-ho visited the U.S. earlier this month to finalize the Czech nuclear deal. They met with senior officials from the DOE and Westinghouse but returned without significant progress. If KHNP and Westinghouse fail to resolve their differences by the final contract date next March, South Korea’s largest nuclear export deal could face serious setbacks.
The delegation aimed to address Westinghouse’s legal actions, which have been obstructing South Korea’s nuclear exports. Westinghouse filed a lawsuit in a U.S. court in October 2022, alleging that KHNP infringed on its technology and claiming that KHNP must obtain U.S. government approval to export the reactors.
In September 2023, the U.S. District Court for the District of Columbia dismissed the case, ruling that export control authority rests solely with the U.S. government and thus Westinghouse lacked standing to sue. However, Westinghouse appealed the decision in October, and the case is now ongoing in the appellate court.
Westinghouse has been involved in South Korea’s nuclear power industry since the construction of the country’s oldest Kori Unit 1 reactor in Busan, transferring various nuclear technologies to the country. Of the 28 reactors built domestically, 18 are based on Westinghouse designs, and the Korean reactors being exported are also based on Westinghouse models. This is why Westinghouse claims rights to the original technology.
The biggest problem is that Westinghouse holds the authority to report the export of Korean reactors to the U.S. Department of Energy. According to NSG guidelines, which South Korea has followed since 1995, Korean reactors based on U.S. technology must undergo U.S. export control procedures. While the process would typically end with a simple notification when exporting to the Czech Republic—a country with a nuclear cooperation agreement with the U.S.—Westinghouse has delayed the notification process due to the ongoing intellectual property dispute, causing concern for the South Korean government and KHNP. KHNP submitted the necessary documents to the DOE in November 2022, but in January 2023, the DOE rejected the submission, stating that the notification must be filed by a U.S. citizen or entity in accordance with relevant regulations.
This article was originally published on Aug. 24, 2024.
