Chinese energy giant opens new plant in South Korea as AI ambitions intensify power crisis

Chinese companies are deepening their participation in South Korea’s energy sector as state-owned nuclear giant CGN Energy International begins operations at a self-developed power project, helping supply China’s power-hungry neighbour amid a surge in electricity demand driven by an artificial intelligence boom. The gas-fired facility, located in Seosan, northwestern South Korea, commenced commercial operations on Friday. With an installed capacity of 557 megawatts, it was expected to generate up to 3.9 billion kilowatt-hours of electricity annually, according to the state-run China Energy News. “The project serves as a key flagship for us as we shift towards greenfield developments and explore running major overseas power plants independently,” Zhang Chaoqun, president of CGN Energy International, was quoted as saying by the outlet. Notably, the report said the plant’s turbines were hydrogen-ready, capable of burning a 30 per cent hydrogen blend. This allows for a potential path to lower-carbon power generation as the green hydrogen supply chain matures. The newly launched plant marks CGN Energy International’s first large-scale, gas-fired power-generation project to adopt an independent management model, the company said in a May statement. Its South Korean subsidiary oversaw every phase – from design and procurement to construction and commissioning – a set-up that the company said helped control costs and keep the build on schedule while involving more than 100 local firms. CGN Energy International now operates five power facilities in South Korea, bringing its total installed capacity in the country to 2.2 gigawatts, China Energy News reported on Friday. CGN Energy International is a subsidiary of China General Nuclear Power Corporation and is positioned as its entity for overseas clean-energy projects, according to its website. The new project’s launch comes amid a broader improvement in bilateral ties and energy cooperation between Beijing and Seoul. An energy-dependent economy, South Korea is facing a power crunch as it strives to transform itself into a global AI powerhouse. In April, President Lee Jae Myung described people’s livelihoods as being in a “warlike situation” amid a looming energy crisis stemming from conflict in the Middle East, according to The Korea Times. During Lee’s high-profile visit to China in January, the leader said that both nations shared “unlimited potential” in energy transition, China Energy News reported. According to information from the Korea Economic Institute of America in March, South Korea was importing 94 per cent of its energy resources, with a heavy reliance on shipments passing through the Strait of Hormuz – a bottleneck that plunged the nation into its energy crisis earlier this year amid the US-Israel war on Iran. Compounding these structural vulnerabilities is Seoul’s surging demand for power to fuel its AI boom. The South Korean government has pledged to become “one of the top three global AI leaders”. In late June, it unveiled plans involving at least 1.35 quadrillion won (US$922 billion) worth of investments to expand the nation’s semiconductor manufacturing and AI capabilities. However, a report by UK-based consultancy Wood Mackenzie earlier this month said the country’s ambition to build one of the world’s largest AI and semiconductor manufacturing hubs “risks running ahead of the electricity system needed to power it”. “South Korea is planning for an entirely new class of industrial load now,” Yunsik Chung, a research analyst at the consultancy who specialises in Asia-Pacific power and renewables, said in the report. “The challenge is less about whether enough generation can ultimately be built than whether the grid, market design and investment signals can evolve quickly enough to support AI infrastructure on the timetable that policymakers and industry expect.” Additionally, a recent study by the Korea Advanced Institute of Science and Technology showed that advanced AI uses 136.5 times more electricity than standard chatbots, according to a report by The Korea Times this month. Apart from CGN Energy International’s project, a unit of China Energy Engineering Corporation has brought two renewable facilities online in South Korea, including a 20MW solar project and a 36MW wind farm now in operation.

Chinese energy giant opens new plant in South Korea as AI ambitions intensify power crisis

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}The state-owned firm’s new project, independently managed by the company’s South Korean subsidiary, brings its number of power facilities in the country to five

The state-owned firm’s new project, independently managed by the company’s South Korean subsidiary, brings its number of power facilities in the country to five