* Closure of nuclear plants for safety checks to cut reserve
* Plans to add 1,270 megawatts from generators, curb demand
by 3,000 MW
* Rolling blackouts may have to be brought in if reserves
* South Korea may have to buy fuel on spot market - minister
(Adds details on LNG)
By Meeyoung Cho
SEOUL, Nov 16 South Korea may have to bring in
rolling power blackouts this winter after the closure of nuclear
plants for safety checks means the electricity network will have
less than a third of normal reserve capacity.
Asia's fourth-largest economy said it plans to add 4,000
megawatts (MW) of power supply capacity through savings and new
plants in a bid to head off potential blackouts.
The nuclear problems have increased the risk of power
shortages in the harsh Korean winter after the closure of two
reactors to replace parts with fake certificates and an extended
shutdown of another reactor where microscopic cracks were found.
The northeast Asian country is heavily dependent on oil, gas
and coal imports, but usually supplies about a third of its
electricity from nuclear power generation from its 23 reactors.
Economy minister Hong Suk-woo said it remained uncertain
whether reactors would be restarted in December after parts were
replaced because the approval of the regulator was necessary, as
well as support from residents.
"This winter will be very, very difficult for us to cope
with," he said, when asked what would happens if reactors did
not restart as planned in December
Under the government's plans, an additional 1,270 MW of
power capacity would come from private and public power
generators, a statement from the economy ministry said.
A further 3,000 MW is targeted from power savings including
less heating at firms and public places, switching off neon
lights and even a campaign to wear thermal underwear.
Without this, South Korea's excess generating capacity in
January is forecast at 1,270 MW, or 28 percent of the margin
that the government aims for to guarantee supplies, the
With little spare capacity, the grid would be vulnerable to
power outages. If two 1,000-MW nuclear reactors fail to restart
by the end December, the margin will drop sharply.
"It is important that no more power plants have outages from
now on," said an economy ministry source, declining to be named.
Minister Hong said South Korea may need to buy more fuel on
spot markets to provide extra power.
"We would buy on the spot markets if necessary. At the
moment we don't need to do as there are enough stocks."
South Korea, which is the world's fifth-largest crude oil
importer and the No.2 LNG importer behind Japan, said this week
it lost two December LNG shipments from Indonesia after a fire
at a terminal there. The cancelled volume was equivalent to 0.3
percent of South Korea's natural gas consumption of 35.41
million tonnes of LNG equivalent, it said.
South Korea said its LNG stocks stand at more than 80
percent of storage capacity at its three storage sites. The
storage capacity is at 4 million tonnes of LNG equivalent.
The level is normal for winter, according to a spokesman at
state-run Korea Gas Corp (KOGAS), although gas
markets are nervous about future demand.
Asian spot LNG prices have been steadily rising since Seoul
announced the nuclear outages, with spot prices now near $14 per
million British thermal units (mmBtu), according to Platts'
benchmark for North Asian LNG, up from just under
$13.50 when news of the nuclear problems broke.
Spot LNG prices are still far below the peak of $18 hit
earlier this year caused by the closure of all of Japan's
nuclear capacity over safety concerns after the Fukushima
South Korea would have to conduct rolling blackouts in the
public sector if excess power generating capacity falls below
2,000 MW, the economy ministry said.
If the margin dips below 1,000 MW, nationwide rolling
blackouts could occur, a ministry source said, similar to what
happened in September of last year when there was maintenance
during a period when demand unexpectedly spiked due to hot
The economy ministry said that shortage of power supply was
expected to improve from 2014 as a combined 7,000 MW from power
plants would be added to a total of more than 80,000 MW of power
generating capacity by the end of 2013.
(Additional reporting by Jane Chung, Eunhye Shin in Seoul, and
Rebekah Kebede in Perth; Editing by Ed Davies)