[Edaily Reporter Kong Chi-Yu ] The government reported to the National Assembly on the 22nd that it has finalized the $22.3 billion “Texas Encinales Combined Cycle Power Plant” project as its first investment initiative in the United States. This decision was based on the assessment that the project’s “commercial viability” is assured, as it is expected to generate up to $45 billion in revenue over the 20-year project period. However, concerns have been raised regarding its commercial viability, as the government has not yet secured a firm power purchase agreement (PPA) from the U.S. for the project.

According to political circles on the 22nd, the National Assembly received a report from the Ministry of Finance and Economy and the Ministry of Commerce, Industry and Energy that morning at the National Assembly in Yeouido, Yeongdeungpo-gu, Seoul, regarding the progress and details of the U.S. investment negotiations.

According to the National Assembly, the government has decided to proceed with a $22.3 billion gas-fired power plant project in Texas. The project centers on the construction of a combined-cycle gas turbine power plant in Encinitas, Texas, to meet the electricity demand of an artificial intelligence (AI) data center, with a total installed capacity of 6.3 gigawatts (GW). The plan is to first develop 1.4 GW of gas turbine power generation in the first phase and then sequentially expand to 4.9 GW of high-efficiency combined-cycle power generation.

The government determined that the project has commercial viability. It reported to the National Assembly that the project is expected to generate a return of $43 billion to $45 billion over a 20-year period. The government also made the decision to proceed after comprehensively reviewing factors such as electricity sales revenue, contracted capacity, and the reliability of U.S. developers.

However, according to reports from the meeting held that day, the government has reportedly not secured a firm power purchase agreement (PPA) from the U.S. regarding Project No. 1. Baek Jun-young, a People Power Party lawmaker and opposition floor leader on the National Assembly’s Finance and Economy Committee, told reporters that day, “We [the opposition] have consistently raised the issue of who will actually buy the electricity.” He added, “There are also questions about who will build the data centers and whether those companies have sufficient capacity.”

Regarding the construction of eight large nuclear power plants worth $120 billion and the Alaska liquefied natural gas (LNG) project—both proposed by the U.S. last month—no decision has been made on whether to proceed. However, given the interest shown by both countries, the government plans to report the implementation plans to the National Assembly and then decide whether to move forward after reviewing the projects’ feasibility.

Regarding the nuclear power plant project—a venture to build eight large-scale nuclear reactors in the U.S. in consultation with Westinghouse—the government is discussing a plan to construct two of them using Korean-designed reactors. A key point of interest was the percentage of Westinghouse shares to be acquired. It is reported that the government sought to acquire a stake of at least 10% to secure a stake in Westinghouse and gain voting rights on its board of directors. However, the government reported to the National Assembly that, due to disagreements with the U.S. side, the stake is currently being finalized at a level between 5% and 10%.

The government also reported to the National Assembly its policy not to proceed with investments if the annual investment in the U.S. exceeds the $20 billion limit. The first remittance is expected to take place within this month.