A construction contract worth 26 trillion won (400 billion koruna) for a new nuclear power plant in the Czech Republic awarded to Korea was halted by a Czech court on the 6th (local time), just a day before the scheduled signing ceremony. The contract signing between Korea Hydro & Nuclear Power and the local contractor EDU II (Dukovany II Nuclear Power Company) was set for the 7th but is now postponed to the next government.
The superficial reason is that the Czech court accepted a request for an injunction against the contract signing made by Électricité de France (EDF), which lost in the bidding competition, but there are also analyses suggesting that the political situation in Korea, where the president is absent, influenced this decision. The nuclear power plant is considered a 'government-to-government' project since cooperation between the two countries is required over nearly 100 years when considering the design, construction, operation, and decommissioning processes.
EDF, which failed to win the Dukovany Nuclear Power Plant phase 2 construction project, raised objections to KHNP’s bid with the Czech antitrust authority (UOHS), claiming procedural issues. UOHS dismissed this claim on the 24th of last month, stating, 'we do not have jurisdiction.' On the 2nd, EDF filed an administrative lawsuit with the Brno District Court to cancel UOHS's decision and submitted a request for an injunction to halt the contract signing. The Brno District Court accepted this, explaining that 'if the contract is signed, EDF would lose its opportunity to win the bid even if it prevails in the main lawsuit.'
As a result of this decision, the signing ceremony of the main contract between KHNP and EDU II has been canceled. Earlier, on the 30th of last month, the Czech government held a cabinet meeting and announced that the signing date for the main contract for the Dukovany Nuclear Power Plant phase 2 construction project had been set for May 7.
There are analyses in the energy industry suggesting that Korea's political situation influenced the outcome. During the UAE Barakah nuclear power plant export contract in December 2009, then-President Lee Myung-bak visited the UAE to conduct the contract signing ceremony with UAE President Khalifa bin Zayed Al Nahyan. In contrast, this time, a presidential delegation represented by Minister of Trade, Industry and Energy An Duk-geun traveled to the Czech Republic, which included Minister of Land, Infrastructure and Transport Park Sang-woo, Vice Minister of Science and ICT Lee Chang-yun, Vice Minister of Foreign Affairs Kang In-sun, and Vice Minister of SMEs and Startups Kim Seong-seob.
Czech media have also raised issues regarding Korea's political situation. Lidové noviny noted in March that 'President Yoon Suk-yeol, whose duties are suspended due to impeachment in the National Assembly, was an active supporter of Korea's nuclear power exports, and the Dukovany nuclear power project was one of his key policies. Issues such as Korea's early presidential election could hinder the progress of the nuclear power contract.'
Despite the Czech court halting the contracts, the government believes there will be no issues with KHNP securing the bid. Minister An met with Korean reporters in Prague, stating, '(It does not seem to be a significant issue for KHNP winning the final bid).' He also addressed concerns that if the opposition takes power in the Czech general election scheduled for October this year, the final contract could be indefinitely postponed, saying, 'It is hard to predict whether it will take weeks or months until the final contract, but the Czech government hopes it will not be delayed due to opportunity costs.'
The new nuclear power plant construction project in the Czech Republic involves building two 1000 megawatt units at Dukovany. Construction is set to begin in 2029, with the 5th unit expected to start commercial operations in 2036 and the 6th unit in 2037. The Czech government initiated the bidding process in March 2022, and KHNP was selected as the preferred negotiation partner in July last year.