Domestic AI data centres are expected to demand 18.4 GW of electricity by 2035. Against that backdrop, criticism emerged that the current cap on direct power purchase agreements (PPAs) is too small compared with 1 GW-class AI factories. The government said it is discussing onsite LNG power generation pilots with relevant ministries.

Hwang Jung-a (황정아), a lawmaker from the Democratic Party, said at an audit of the Ministry of Science and ICT by the National Assembly’s Science, ICT, Broadcasting and Communications Committee on Oct. 6 that the total expected power demand for AI data centres planned in South Korea through 2035 is about 18.4 GW. She argued that power supply systems should be brought in line with the expansion of AI infrastructure.

Hwang said, in particular, that although it appears possible to sign a 500 MW SMR PPA, the actual capacity cap is 40 MW. She said power must be supplied to a 1 GW AI factory and that LNG, even in combined heat and power form, only reaches 500 MW.

She added that South Korea must secure full-stack leadership and export capabilities, from onsite generation pilots such as LNG and SMR to semiconductors, power and the building and operation of AI factories. She called for institutional improvements related to PPAs and onsite generation.

Deputy Prime Minister and Minister of Science and ICT Bae Kyung-hoon (배경훈) replied to the need for institutional improvements by saying, "That needs to be done."

Bae said the government is continuing discussions with the climate ministry on LNG PPAs and onsite pilots for AI data centres. He said relevant ministries are also attending meetings to review the three major AI mega projects and that the government will derive the best approach.

The issue of tax support for investment in AI data centres was also raised.

Hwang said investment in national strategic technologies totals 45.9 trillion won, but there have been no cases of AI data centre tax credits passing deliberation. She said there are concerns in the field that they are being treated as real estate leasing businesses.

Bae replied that he would take direct charge because the Ministry of Science and ICT is the lead ministry for AI infrastructure construction projects based on data centres.