NIMBY may dent mega Samsung project
Conflict arises over electricity in Samsung chip plant
By Kim Yoo-chul
Samsung Electronics' ambitious plan to build the world's largest memory chip plant worth hundreds of billions of dollars in the industrial city of Pyeongtaek is facing difficulties due to a "not-in-my-backyard" attitude.
Samsung Electronics said it will invest up to 15.6 trillion won by 2017 for the construction of some of its new chip plants in the Gyeonggi Province city south of Seoul.
Samsung said it has yet to decide what type of memory chips will be produced at the new plant. But market watchers say Samsung, a leader in the memory chip segment, may fabricate NAND flash chips given the tight supply and the growth of NAND chip-embedded consumer products.
But it seems uncertain whether Samsung's plans to operate its new fabrication lines based on its schedule will proceed, as cities near Pyeongtaek are reluctant to cooperate with Samsung and Korea Electric Power Corp. (KEPCO) to provide a stable power supply for the Samsung plant.
Even a brief power outage would directly disrupt the operation of a chip plant, generating heavy costs for a chip manufacturer.
As Samsung is the industry's global leader, any power outage at its factories will affect the supply and demand chain system of the entire global industry.
Securing a stable power supply is the most-crucial requirement for setting up a new plant.
Because the Samsung project is huge by any measure, and sure to boost the regional economy, the state-run KEPCO has been in talks with several cities to address the power supply issue.
Dangjin, a South Chungcheong Province city by the sea which also borders Pyeongtaek, refused to approve plans to build power stations in its city limits as its leaders said having additional power stations will hurt the best interests of city residents.
A local court recently ordered Dangjin to withdraw its earlier decision not to approve the power stations and cooperate with KEPCO. However, the city said it will appeal to a higher court.
Anseong has also yet to approve a plan to construct electric power transmission lines linking the city's power grid to the Samsung Pyeongtaek plant.
"In Anseong, there are more than 340 transmission towers. We have no reason to let parties build new transmission towers as they aren't environmentally friendly and detract from the beauty of the city. The Pyeongtaek project will be beneficial to Samsung but not to us," said an Anseong city official wishing not to be identified.
KEPCO planned to help Samsung secure up to 10 million megawatts (MW) of backup power for the Pyeongtaek plant to prevent the chip manufacturer from suffering disruptions to its power supply.
City officials also teamed up to ask KEPCO to come up with plans benefiting non-Pyeongtaek residents in return for their cooperation in the business project.
Samsung said it will cut its investment in DRAMs this year, as the company plans to increase production of NAND chips on its major fabrication lines.
In 2007, Samsung suffered a brief power outage at its chip plant in Yongin, southeast of Seoul. Samsung at that time said the outage had been caused by a switchboard malfunction that disrupted chip production lines, costing it some 40 billion won.
More recently, Samsung Electronics suffered a short power outage at the company's NAND-chip fabrication line in Xian, China. The losses were negligible as some of the plant's capacity was restored the same day following emergency repairs and a damage assessment.
koreatimes.co.kr
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