Power Demand Surges by 38GW for AI and Semiconductors: "Electricity as a National Strategic Asset"

The 4th Public Policy Forum on the 12th Basic Electric Power Supply and Demand Plan
Annual Additional Demand of 260 TWh Projected From Three Major Mega-Projects
100 GW of Renewables Not Enough: Calls for Proactive Expansion of Nuclear, ESS, and Transmission Networks

Yonhap News

In order to secure competitiveness in advanced industries such as artificial intelligence (AI) and semiconductors, a recommendation has been made that electricity should be viewed not merely as an energy source but as a national strategic asset. This approach calls for a complete redesign of the entire electricity system, from power generation and the grid to the market. As the three major mega-projects promoted by the government—such as semiconductor and AI data centers—are expected to generate about 38 GW of additional power demand, experts stress the need to proactively secure carbon-free power sources like nuclear power, energy storage systems (ESS), and an expanded transmission network.

At the 4th Public Policy Forum on the 12th Basic Electric Power Supply and Demand Plan, held at the National Assembly Members’ Office Building on August 20 by the Ministry of Climate, Energy and Environment and the 12th Power Supply and Demand Basic Plan General Committee, Professor Lee Jongsoo of Seoul National University's Department of Technology Management, Economics and Policy suggested that a “Power Nation” strategy is needed to treat electricity as a national strategic asset in order to secure competitiveness in cutting-edge industries like AI and semiconductors.

The concept of a Power Nation involves building an advanced power system—including carbon-free power generation, power grids, energy AI, and storage technologies—as a national strategic asset, and, based on this foundation, electrifying society as a whole across industry, transport, and buildings. Professor Lee emphasized that, beyond simple energy transition policies, electricity infrastructure should be integrated into national growth strategies, taking into account industrial sites, trade, balanced regional development, and technological sovereignty.

To this end, he proposed implementing AI-based grid operations in line with the expansion of renewable energy, increasing the capacity of flexibility resources such as ESS and virtual power plants (VPP), and encouraging investments in clean energy by expanding long-term contracts in the power market. He called for combining nuclear and renewable energy to stably supply carbon-free electricity, making proactive investments in transmission networks and ESS, and integrating AI-based grid operations.

He also recommended that industrial site selection should be reorganized around power supply capability. Since AI data centers and semiconductor fabs require large-scale, high-quality, uninterrupted electricity, he argued that the traditional approach of placing industries first and then supplying power should be reversed—first securing sufficient power infrastructure, and then deciding where to locate industries.

Yonhap News Agency

Park Wooyoung, Director of the Energy Transition Policy Research Division at the Korea Energy Economics Institute, suggested in a presentation on “Future Power Demand and Energy Policy Directions Considering Mega Projects” that, to cope with soaring future power demand, not only renewables but also other carbon-free power sources, such as nuclear power, must be secured in a timely manner.

Park estimates that the three mega-projects will generate around 38.4 GW and 260 TWh of additional annual power demand. He projected that AI data centers alone will require an additional 18.4 GW by 2035, and semiconductor clusters will need an extra 20 GW by 2041. In terms of annual power volume, this translates to about 121 TWh and 140 TWh respectively—meaning the total additional demand would be 40–50% of the country's total power generation of 596 TWh in 2025.

He also noted that it would be difficult to meet this demand through renewable energy expansion alone. Even if 100 GW of renewable capacity is achieved by 2030, the actual annual generation from solar and wind—accounting for utilization rates—would only be about 150 TWh. Since this falls short of the additional 260 TWh needed for the mega-projects, he argued that, alongside expanding renewables, other carbon-free sources such as nuclear power must be secured and flexibility installations like ESS must be expanded.

Expanding the transmission grid was also identified as a key task. As renewables tend to be concentrated in regions like Honam and Jeju, while new demand arises in places like Yongin, the "temporal and spatial mismatch" between supply and demand is widening. Notably, 30 out of 54 new transmission and transformation facilities in the 11th Basic Electric Power Plan are expected to be delayed, so preemptive construction of substations outside the metropolitan area and the use of HVDC and ESS to boost existing grid efficiency were recommended.

Minister of Climate, Energy and Environment Kim Sunghwan also emphasized the need to treat electricity as a long-term national strategy. He said, "It may only take two to three years to prepare for a TV or AI data center if you put your mind to it, but it takes much longer to prepare electricity infrastructure. Electricity should not merely be a supplement for industry, but must become a core strategic and security asset for the nation."

He continued, "The United States has chips but a fragile electricity supply; China has electricity but a weak chip sector. Whether the Republic of Korea becomes a center of new civilization or reverts to the past will depend on how we resolve this challenge."

Minister Kim concluded, "With renewables at the center and some nuclear energy mixed in as a clean power source to operate AI data centers and AI robots, it will be a global race to see which country creates a new society that allows humanity to live more equally and happily. I believe the Republic of Korea has the highest potential to achieve this vision."

This content was produced with the assistance of AI translation services.