I have mentioned the problems the nuclear industry in South Korea (S.K.) are having with fraudulent parts replacement in previous posts. Today I am going to drill down into the South Korean scandal in more detail. For years, S.K. has depended on nuclear power for about one third of their electricity. Unfortunately, an unholy trinity of nuclear power companies, nuclear equipment suppliers and nuclear equipment testing companies has been recently been revealed that threatens the S.K. use of nuclear power.
Last April, an official investigation was started after authorizes received a tip from an anonymous source revealing information about illegal practices. Some officials at a testing company have been indicted by prosecutors for faking safety tests on parts intended for installation in nuclear power plants. There is a state-owned company that designs nuclear power plants. Some of the officials at that company were indicted for taking bribes from testing companies in return for accepting substandard parts. Recently more nuclear parts suppliers had their offices raided. And even more companies may be pulled into the search. Investigators are working their way through over one hundred thousand test certifications from the past decade to find out which are fraudulent.
To date, investigators have found that testing companies skipped some sections of mandatory tests, forged test data to meet requirements and even issued certification of safety for parts that had actually failed the tests. Investigations have revealed that the suspect components are installed in fourteen out of the twenty three nuclear power plants in S.K. This amounts to concerns with two thirds of their nuclear plants. At first, the government said that the thousands of parts that had not met requirements were not important because they were installed in peripheral and non-critical systems. Then three plants had to be closed because questionable parts had indeed been installed in critical places. More plants may have to be closed as the investigation proceeds. A nuclear engineer in S.K. has said that so far only the tip of iceberg has been revealed.
The S.K. government has consistently told their citizens that nuclear power was safe and they were in no danger. The public is becoming increasingly concerned about the truth of that position as more and more problems have been revealed. The closing of the three reactors has prompted the government to ask the citizens of S.K. to conserve energy during a particularly warm summer which has further corroded the public confidence. In addition, the S.K. government has been promoting the export of nuclear technology to other countries as one of the solutions to a cooling of S.K. economy. These problems with part certification could be a public relations disaster for S.K. companies trying to sell S.K. nuclear technology abroad.
The investigators blame the problems they uncovered on the highly centralized and poorly regulated S.K. nuclear industry. There is one state owned company that runs all the nuclear power plants. Another state-owned company designs and builds all the nuclear power plants. People retiring from these state-owned companies often move on to the suppliers and testing companies or, in some cases, investin suppliers and testing companies. In the S.K. culture, personal ties are very important and can sometimes overrule adherence to laws and regulations. In addition, there is the ever present problem of corruption and the lure of bribes. The investigators refer to the situation in the S.K. nuclear industry as an “entrenched chain of corruption.” The targeted companies have promised to institute new practices to root out corruption and improve testing and certification. However, such promises have proved empty in the past and I have little confidence that they will be honored in the future.
