Can Boryeong, Hit by Coal Plant Closures, Transform Into a Data Center City? [AIDC Era of Coexistence] (18)

Transforming Data Centers
Boryeong’s Adaptation Amid Population Decline
Driving Local Economic Revitalization and Job Creation

Editor's Note
In the era of artificial intelligence (AI), the government has announced a plan to build data centers with a total capacity of 18.4GW by 2035 as a part of its three major megaprojects, aiming to establish them as a future growth engine for the nation. Data centers, which have traditionally served only as facilities supporting IT services, web applications, and data storage and sharing, are now evolving into industrial platforms that produce and supply AI computing resources. However, despite the growing consensus that they are a key infrastructure determining the country’s industrial competitiveness, there are still many challenges to be overcome before the expansion of AI data centers (AIDCs) can be realized. The Asia Business Daily has covered overseas cases in Finland, Denmark, Germany, and the Netherlands, where issues surrounding AIDCs—including power, permits, water supply, and resident conflicts—have been skillfully resolved. We also explore solutions for how AIDCs can coexist as assets for local communities in Korea.

A Boryeong City Hall official is explaining the site where the AI data center will be established within the Ungcheon Industrial Complex. Photo by Heejong Kang

"From here to the far end, this entire area is designated for the data center."

When we visited the Ungcheon Industrial Complex in Boryeong, South Chungcheong Province last June, Kim Inseong, Head of Corporate Attraction Support at Boryeong City Hall, pointed to a vast open plot. Although summer foliage was thick, the square-shaped site looked perfectly suited for the data center.

In November of last year, South Chungcheong Province, Boryeong City, and Woongcheon AI Campus (a special purpose company established by F& Partners) signed a business agreement to construct a state-of-the-art data center specializing in AI at this location by 2029, investing a total of 2 trillion won. Covering 103,109 square meters—larger than the size of 14 soccer fields—the site offers significant scale. Kim explained, "Unlike tower-shaped urban data centers, here we can build a flat-style data center, like in the United States."

◆ Power Grid Impact Assessment Completed... Advantageous Power and Water Supply

When the 2 trillion won project plan was first released, some viewed it with skepticism, doubting whether it was more than just a plausible-sounding announcement. As the project developer, Woongcheon AI Campus achieved milestones such as completing the power grid impact assessment from KEPCO in June. However, tenant companies have yet to be secured. Recruiting these companies is essential to raise funds and proceed with construction. Woongcheon AI Campus is a special purpose company (SPC) established by F& Partners.

Kim Yongho, CEO of Woongcheon AI Campus (F& Partners), recently stated in an interview with The Asia Business Daily, "We are currently in negotiations with major global tech corporations and domestic IT giants regarding tenancy," adding, "We expect to see visible progress in 2027." He also noted that, due to the flat-style design, actual construction would take only a year and a half—much shorter compared to tower-types.

The Ungcheon Industrial Complex is situated in the southwestern part of South Chungcheong Province. To date, there has never been a large-scale AI data center constructed in this region. Regarding this, CEO Kim explained, "Due to restrictions such as power grid impact assessments, it is now impossible to build hundreds of megawatts worth of AIDCs in the capital area," and, "After reviewing various locations in the Chungcheong region, we determined Boryeong to be the optimum site, considering the electricity and water supply."

Boryeong offers definite advantages in terms of access to electricity and water—both critical for AI data centers. A coal-fired power plant is located nearby the Ungcheon Industrial Complex, and water is supplied reliably through the Boryeong Dam.

Kim Yongho, CEO of Woongcheon AI Campus (F& Partners). Photo by Heejong Kang

The planned AIDC at the Ungcheon Industrial Complex will initially be built to support 100MW, but it can be expanded according to future business needs. CEO Kim explained, "We initially applied for 100MW, but depending on how the project progresses, we plan to expand the receiving capacity up to 400MW." Accessibility to the capital area is also reasonable, as it is less than a five-minute drive from the complex to the Muchangpo IC on the Seohaean Expressway.

Power for the AIDC will be supplied from the Daecheon Substation, roughly 8 km away. The 154-kilovolt transmission lines will be laid underground to minimize conflict with local residents. The initial power supply will utilize the stable coal-fired power plant, but renewable energy sources such as solar power will be expanded in stages. CEO Kim stated, "We plan to participate in the Boryeong Solar Power Aggregation Complex project and sign direct power purchase agreements (PPA), aiming to partially achieve RE100 (100% renewable energy sourcing)."

Transformation from Stone Industry Hub to Digital City

Above all, Boryeong City is highly committed to attracting the AIDC. The city envisions transforming itself into a digital industry hub by bringing in the AI data center.

Boryeong is one of Korea's representative population-declining regions. Although the summer peak brings many visitors to Daecheon Beach, the city's resident population shrinks gradually every year. By the end of 2025, Boryeong’s population will have fallen to just 92,000. Specifically, in 2024, it decreased by 1,900, and in 2025, by another 1,600.

Once celebrated as the main origin of "oseok" stone (used for gravestones), Boryeong’s stone industry once flourished. However, changes in burial customs and the rise of cremation have led to a decline. The industrial base is also weak—95% of the manufacturing businesses in Boryeong employ fewer than ten people.

The closure of the coal-fired power plant has seriously impacted the local economy and population. When Boryeong Power Units 1 and 2 were shut down in 2020, the population decreased by 1,800. Units 5 and 6 are scheduled for closure in 2027. Through the late 2030s, Units 3, 4, 7, and 8 will also close in succession. These closures may accelerate workforce outflow and deepen economic stagnation in the area.

Confronted with the decline of the stone industry and the coal power plant shutdowns, Boryeong faces an urgent need to secure new growth engines. One such breakthrough is its strategy to attract "advanced local-rooted companies" like AIDCs. Kim Inseong of Boryeong City Hall said, "Attracting an AI data center aligns well with policies for a hydrogen-specialized complex, energy opportunity-specialized zones, offshore wind farms, and solar cluster complexes—all part of Boryeong’s carbon-neutral renewable energy and the era of AI-driven transformation."

Boryeong City expects that the arrival of an AI data center will revitalize the local economy and create jobs through various cooperation measures. In the case of the 100MW-scale AI data center being promoted by Woongcheon AI Campus, it is estimated that approximately 120 to 150 staff will be directly hired. However, the city has even greater expectations for fostering an R&D ecosystem via the AI data center. Boryeong City and Woongcheon AI Campus plan to allocate part of the AIDC as an R&D center and make it available to startups.

Team Leader Kim said, "We plan to cooperate with the operator to offer some AI servers to startups at affordable rates, thereby creating an incubator environment for young entrepreneurs." CEO Kim added, "Leasing fees per kilowatt for AI data centers are around 250,000 to 300,000 won per month, which is unaffordable for many young people. By allocating some servers to startups, hundreds of founders may benefit."

This report was supported by media development funds created from government advertising fees.

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