South Korea’s Korea Hydro & Nuclear Power (KHNP) has withdrawn from a Polish NPP project. The move comes following KHNP’s settlement in January of an intellectual property (IP) dispute with US-based Westinghouse Electric Company.
KHNP President Whang Joo-ho said during a National Assembly audit that the company “has effectively withdrawn” from the Polish project. “We were pursuing both government-led and state-owned enterprise-led projects, but Poland decided not to proceed with the state-owned enterprise project after a new government came into power there. That is why we withdrew our business there,” Whang explained.
This is the fourth time KHNP has withdrawn from a European market since its settlement with Westinghouse in January, with the company giving up on nuclear bids in Sweden, Slovenia, and the Netherlands.
According to Korean media, KHNP ceded leadership of nuclear projects in Europe when it settled its dispute with Westinghouse. Although the terms of the settlement remained confidential, a report in The Korea Economic Daily, at the time cited industry experts as saying that KHNP may have offered significant concessions including paying royalties and sharing future contracts, among others. The settlement came after the USA and South Korea initialled a memorandum of understanding (MOU) on Principles Concerning Nuclear Exports and Cooperation in November 2024.
The dispute arose in the context of competition between Westinghouse and KHNP for contracts in Poland and the Czech Republic. Westinghouse in October 2022 filed the suit alleging that Korea’s APR1400 reactors copied the System 80 reactor designed by Combustion Engineering, which was acquired by Westinghouse in 2000. Westinghouse insisted that the Korean companies were using its technologies and needed to obtain approval of the US government before exporting them to a third country.
Korea, on the other hand, claimed that, while early development of its reactor technology was supported by Westinghouse, the current models it is seeking to export were developed using its own technologies and were not subject to US restrictions. KHNP said the company had developed original reactor technology over the past 30 years and now owns the intellectual property rights. KHNP filed countersuits claiming that the US Atomic Energy Act grants authority to enforce the law exclusively to the US Attorney General and not to entities seeking to claim rights through litigation.
The litigation was a move by Westinghouse to stop the Korean companies from selling reactors to Poland, which was then evaluating offers from Westinghouse, KHNP and France’s EDF to supply its first commercial NPP. Although Westinghouse won that tender, Korea subsequently signed an agreement with a private companies ZE PAK and PGE (Polska Grupa Energetyczna) to supply its APR1400 reactors at another site.
In July 2024, the Czech government selected a Korean consortium led by KHNP as the preferred bidder for the additional construction project of the Dukovany NPP, with plans to finalise the contract by March next year. Westinghouse and EDF, which lost in the bidding competition, then filed objections with the Czech antitrust authorities. These objections were subsequently dismissed, allowing KHNP to maintain its position as the preferred bidder. However, the deal’s signing was delayed by the ongoing legal dispute with Westinghouse.
As part of the settlement, KHNP reportedly agreed to significant restrictions in order to secure the Czech contract. As a result, it is barred from entering the nuclear markets of European Union member states (except the Czech Republic), North America, the United Kingdom, Japan, and Ukraine. It is now restricted to pursuing projects in Southeast Asia, Central Asia, the United Arab Emirates, Saudi Arabia, South America, and Türkiye.
According to the agreement, first reported by The Seoul Economic Daily, KHNP agreed to sign contracts for goods and services worth $650m with Westinghouse for each export of a single nuclear reactor, and to pay an additional $175m per reactor in technology licensing fees. Allegations also emerged that KHNP agreed to issue a standby letter of credit (SBLC) for Westinghouse. The 50-year deal also contains a provision requiring Westinghouse to verify the technical independence of Korean companies before they can bid on overseas nuclear reactor projects, including small modular reactors.
Criticism has emerged that the former Yoon Suk Yeol administration signed a deal with “poison pill” clauses in order to secure the Czech contract. Lawmakers blamed KHNP for bowing to US pressure to secure the deal during the National Assembly audit. However, Whang defended the controversial settlement. “I do not think the terms are fair from our perspective,” he said. “The total amount and percentages make it seem like Westinghouse gets a large portion, but since Westinghouse lacks its own supply chain, it will inevitably have to subcontract to those with supply chains like us even if it takes a share.” His remarks suggested that KHNP could still secure profits from Westinghouse-led projects as the company lacks independent nuclear construction capacity. However, he declined to provide detailed answers, citing confidentiality obligations.
“Westinghouse may hold the original technology, but it lacks the construction capacity to independently build reactors, which means Korean companies are likely to handle the construction in future projects,” said an industry insider told the Korea Herald on condition of anonymity. “Even if the deal is viewed as unfavourable, I believe it was inevitable if Korean companies are going to expand their overseas nuclear businesses.”
Some also argue that cooperating with Westinghouse could benefit Korea’s nuclear ecosystem, according to Korea JoongAng Daily. While Westinghouse holds the original technology and built the world’s first commercial nuclear power plant in the 1950s, its ability to supply new reactors has diminished following the 1979 Three Mile Island accident, which halted nuclear construction in the US. Recently, Westinghouse has been expanding its collaboration with Korean companies such as Doosan Enerbility and Hyundai Engineering & Construction in projects where it has secured contracts.
“A partnership with Westinghouse is inevitable for Korean nuclear firms,” an industry source who requested anonymity told Korea JoongAng Daily. “With U.S. President Donald Trump pledging to quadruple the number of nuclear reactors in the United States, this could also open doors for Korean companies to enter the American market.”
A nuclear engineering professor, who also wished to remain anonymous, told the paper: “There may be some disappointing aspects of the agreement with Westinghouse. But a 50-year contract can be adjusted depending on future developments. Korea should maintain cooperation with Westinghouse while also pushing forward with independent technology development.”
However, the Korean presidential office has ordered the Ministry of Trade, Industry & Energy to investigate the controversy surrounding the contract between KHNP and Westinghouse. Presidential spokesperson Kang Yoo-jung told a press briefing that “the Chief of Staff instructed the ministry to determine whether the negotiation and contract process between KHNP, Korea Electric Power Corp. (KEPCO), and Westinghouse were conducted in accordance with laws, regulations, principles, and procedures.”
The Industry Ministry is expected to examine the Czech project negotiations. “We are compiling the situation in accordance with the presidential office’s directive and will report soon,” a senior ministry official said. “Once we report it, it will be possible to judge whether this contract indeed undermines our national interests.”
The escalating tensions are complicating the agenda for the upcoming Korea-US summit, where nuclear energy cooperation is expected to be a major subject of discussion between South Korean President Lee Jae Myung and US President Donald Trump.
However, the South Korean government has rejected assertions that the establishment of the joint venture would be included on the summit agenda. “The cooperation between KHNP and Westinghouse is a matter for the companies to discuss themselves and is not included in the cooperation agenda between the two governments,” according to an Industry Ministry statement. It added that KHNP is “considering various forms of cooperation” with Westinghouse, but noted that “no concrete details have been decided”.
