South Korea power grid delays threaten AI and semiconductor projects

South Korean lawmakers are raising alarms over the nation's ability to supply electricity for major industrial projects, including semiconductor manufacturing, physical AI, and AI data centers. During a National Assembly audit of energy agencies, concerns were highlighted regarding the significant delays in constructing power transmission and substation facilities.

Data analyzed by Representative Eo Gi-gu reveals that the cumulative delay for 283 ongoing transmission and substation projects exceeds 121 years. Only 18.3% of major projects under previous power supply plans were completed on schedule. Key causes for these delays include resident complaints, licensing issues, and delays in preceding construction processes. For example, the North Dangjin to Sin-tangjeong transmission line was completed 7.5 years behind schedule.

Financial and technical challenges also persist. The Korea Electric Power Corporation (KEPCO) faces a high debt ratio, exceeding 400%, while the projected investment required for transmission and distribution through 2038 is estimated at 72.8 trillion won. Additionally, the rapid expansion of renewable energy has introduced concerns regarding grid stability, specifically the risk of inverter-based power sources causing voltage and frequency fluctuations.