Opposition party demands review of Yongin semiconductor cluster development plan

Yongin semiconductor cluster site, near Seoul. [Photo by Park Hyung-ki]

South Korea’s Democratic Party has demanded a review of the government’s plan to build a semiconductor cluster in Yongin, Gyeonggi Province, which is expected to become the world’s largest semiconductor cluster, citing the lack of energy generated by solar power and other renewable sources.

The party’s demand comes as the country’s tech giant Samsung Electronics Co. is poised to invest 300 trillion won ($226.47 billion) in the semiconductor industry and the government exempted institutions in the planned cluster from preliminary feasibility studies to enhance the competitiveness of the country’s semiconductor industry. The Democratic Party is also being accused of finding fault with the plan to continue the preceding Moon Jae-in government’s nuclear phase-out policy.

On Tuesday, the opposition party’s Carbon Neutrality Committee held a press conference at the National Assembly Communication Building where it argued that the incumbent Yoon Suk Yeol government is ignoring the global RE100 (100 percent renewable energy usage) trend and plans to use liquefied natural gas (LNG) power plants to power the Yongin semiconductor cluster.

“The amount of solar power in the planned Yongin cluster is 70 megawatts (MW), which is only 1 percent of the cluster’s electricity demand. We must fundamentally review the cluster development plan and rewrite it entirely,” Representative Yangyi Won-young of the opposition party argued, calling for the cancellation of the plan to build six LNG combined cycle power plants in the cluster and the formulation of a renewable energy supply plan.

In March this year, the Ministry of Trade, Industry and Energy announced plans to create a semiconductor cluster in Yongin. According to the published plan, the Yongin System Semiconductor Cluster in Gyeonggi Province is expected to require more than 10 gigawatts (GW) of electricity by 2050, when corporate investments are completed. The government and Korea Electric Power Corp. (KEPCO) are planning to build an LNG power plant in the cluster to supply the initial electricity needs, but the opposition party is calling for this to be canceled immediately and more renewable energy facilities, including solar power plants, to be built instead.

Earlier, Samsung Electronics decided to invest 300 trillion won by 2042 to build the Yongin cluster, as it aims to build an ecosystem that surpasses Taiwan’s Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s top global foundry.

After the project was announced, Korea Land & Housing Corp. (LH) was selected as the implementing agency and the government announced on September 4 that it would exempt public institutions in the advanced semiconductor-exclusive national industrial complex from preliminary feasibility studies.

Both the government and the industry are baffled by the Democratic Party’s sudden demand for increased solar power capacity. Providing a significant portion of the required 10 GW of electricity with renewable energy, such as solar power, is considered unrealistic. “The demand for electricity in the Yongin area is expected to increase gradually until 2050, and no matter how much renewable energy is built into the area, it will not produce the required power efficiently,” a power industry official said. “It will also not be possible to secure a suitable location for renewable energy facilities.”

As stable power supply is crucial for semiconductor production, the intermittent nature of renewable energy is a significant drawback. If a factory were to stop due to a lack of power, significant losses would be inevitable. Additional facilities such as energy storage systems (ESS) would also need to be constructed to address this issue but comes with a higher cost and scheduling challenges.

A government official also mentioned that LNG power plant construction is the most realistic option to ensure a stable power supply when the factories are operational, adding, “There are many other ways to achieve RE100 besides building renewable energy sources in the vicinity.”