Insights

Will Korean Products Made with Nuclear Power Remain Competitive in Global Markets?

ㅣTaehan Kim, COO of KoSIFㅣ

“We sell products made with nuclear power.”

RE100, the global initiative through which companies commit to using 100% renewable electricity, has become a major international trend. Yet it is difficult to find companies using nuclear power—another low-carbon energy source—as part of their corporate branding or product marketing.

Why is that?

     Korea’s Version of CF100

Korea’s Ministry of Trade, Industry and Energy has recently stepped up efforts to promote CF100.

The 24/7 Carbon-Free Energy Compact was launched in 2021 by Sustainable Energy for All, an initiative supporting the energy-related objectives of the UN Sustainable Development Goals, together with Google.

Unlike RE100, which requires companies to match their annual electricity consumption with renewable electricity, 24/7 CFE allows the use of other carbon-free sources, including nuclear power. It also requires electricity consumption to be matched with carbon-free generation on an hourly basis.

Because real-time procurement of carbon-free electricity could place a significant burden on Korean companies, the government is expected to introduce a Korean version of CF100 without the hourly matching requirement. The ministry has stated that it does not intend to apply the strict criteria of 24/7 CFE in full.

In May, the ministry and the Korea Chamber of Commerce and Industry launched the Carbon-Free Energy Forum. The forum plans to appoint a chair and begin full-scale activities.

The government is also considering a certification mechanism for nuclear-generated electricity and a procurement system through which companies could purchase it. At the same time, it plans to pursue diplomatic efforts to encourage other governments to support the international expansion of Korea’s CF100 model.

A growing number of Korean companies are being asked by global customers, including Apple and Volvo, to meet RE100 requirements. However, the Korean government argues that companies face difficulties because renewable energy resources are limited and prices remain high.

From this perspective, CF100 is considered more suitable for Korea because it includes nuclear power, which produces little carbon during generation and is relatively inexpensive. This is the central rationale behind the government’s policy.

It is, of course, positive that the government recognizes the challenges facing companies and intends to provide support.

Past experience, however, suggests that government attention and assistance do not always benefit companies. In some cases, government intervention has created additional burdens or contributed to the isolation of Korean businesses.

Effective policy requires an accurate diagnosis. To develop measures that provide real support in practice, the government must first identify the underlying causes based on actual market conditions.

     Scientific Fact: Nuclear Power Is a Low-Carbon Energy Source

Climate change is driven by greenhouse gas emissions, most of which result from the combustion of fossil fuels for energy production.

Modern development without energy is difficult to imagine. Sustainable growth therefore requires alternative energy sources that can produce electricity without substantial greenhouse gas emissions.

Some argue that only renewable energy sources such as solar and wind should be used. Others maintain that nuclear power, as a carbon-free source of electricity generation, must also be included.

That nuclear power generates electricity with low direct carbon emissions is a broadly accepted scientific fact. In Korea, where nuclear energy has long been the subject of intense public debate, this is basic knowledge.

As the government argues, achieving carbon neutrality does not necessarily mean that all energy must come exclusively from renewable sources.

The problem is that nuclear power remains deeply controversial, and the debate continues without resolution.

Whether expanding nuclear power is an appropriate response to climate change, given the risks associated with plant operation and radioactive waste management, remains sharply contested both in Korea and internationally.

Nuclear debates often become disputes over scientific truth. One side argues that the risks of nuclear power have been exaggerated, while the other argues that they have been understated.

Each claims that its position is more scientific—and, by implication, that the opposing view is not. The debate often ends without resolution, merely confirming the differences between the two sides.

Why does the nuclear debate continue indefinitely?

There may be several explanations, including concerns over transparency. One important reason, however, is the difference in how people understand risk.

Risk is not defined by scientific evidence alone. It is shaped by both factual information and how individuals or societies perceive that information.

Because views on risk differ so fundamentally, repeated arguments over scientific facts alone are unlikely to produce a clear conclusion.

     RE100 Is Not About Science. It Is About Economics.

“A bed is not furniture. It is science.”

This advertising slogan helped one company become the market leader in Korea’s mattress industry.

The same object or issue can be approached differently depending on one’s position and perspective. A company that views a bed primarily as a design product will invest heavily in its appearance. A company that focuses on function will concentrate its resources on developing mattresses that create an optimal sleeping environment.

Although RE100 and CF100 appear to address climate change and energy, they are ultimately rooted in corporate economic interests. They are, after all, initiatives led by companies.

The purpose of a company is to maximize profit. To do so, it must increase revenue and reduce costs.

Many global companies join RE100 and require renewable electricity use across their supply chains because they believe that, even if costs increase in the near term, renewable energy will ultimately allow them to sell more products, charge higher prices, strengthen their brands, or reduce long-term business risks.

France generates more than 70% of its electricity from nuclear power. French companies therefore operate in an environment where nuclear-generated electricity is readily available.

Yet I have rarely seen a French company establish a separate nuclear electricity target or use nuclear power as a central marketing message.

This suggests that while nuclear power may contribute to carbon neutrality, it does not necessarily help companies increase revenue.

“It’s the economy, stupid.”

When discussing RE100 and CF100, energy should be considered not only as a matter of science or engineering, but also as a matter of economics. And economics is closely connected to perception.

If the government’s objective is to support Korean companies, it must approach the issue from an economic perspective.

Rather than focusing primarily on persuading foreign governments, it should consider how overseas consumers and companies that require renewable energy use could be persuaded to accept nuclear power.

At the end of the economic chain is the consumer.

It is highly questionable, however, whether a government can persuade foreign consumers in this way.

We live in a pluralistic democratic and capitalist world. Influencing a foreign government does not necessarily change the views of consumers in that country.

Except in a small number of authoritarian states, governments cannot directly control individual purchasing decisions. It is also difficult to find cases in which government publicity campaigns have significantly altered consumer judgment.

The prospects are even more uncertain when nuclear power is involved. Despite decades of public debate, a substantial proportion of citizens in Korea and other countries continue to hold negative views of nuclear energy.

There is also a risk that the government’s approach could reinforce negative perceptions of Korean companies among overseas consumers.

Global companies are competing to demonstrate climate leadership by accepting higher short-term costs in pursuit of long-term value.

In this context, how many consumers would respond positively if the Korean government promoted a domestic CF100 model that excludes hourly matching because Korean companies consider the requirement too costly?

Handled poorly, the government could appear to be promoting a shortcut for Korean businesses.

We live in a capitalist economy. Governments cannot simply redirect market demand.

The market’s expectations are already clear.

If the Korean government is genuinely concerned about the export competitiveness of domestic companies, its priority should be to expand the supply of renewable energy and create conditions that allow companies to procure it at competitive prices.

That is the most urgent task the government should address.