Prasad Kalyanaraman, vice president of infrastructure services at Amazon Web Services (AWS), speaks during a ceremony at the Exhibition and Convention Center in Ulsan, South Korea, to launch a project to build an artificial intelligence (AI) data center to be jointly built by SK Group and Amazon Web Services. Lee vowed to provide full-scale support for the AI industry, aiming to position it as South Korea’s next major economic growth driver. Photo by YONHAP / EPA
May 10 (Asia Today) — South Korea’s effort to expand regional artificial intelligence infrastructure is expected to accelerate after the National Assembly passed a special law designating AI data centers as national strategic facilities. However, questions over long-term electricity supply remain a major challenge as lawmakers excluded a key provision allowing direct liquefied natural gas power purchase agreements.
The “Special Act on the Promotion of the AI Data Center Industry,” approved Wednesday during a plenary session of the National Assembly, will take effect in February after a nine-month grace period following Cabinet approval.
The legislation is designed to simplify the construction process for AI data centers, particularly outside the Seoul metropolitan area, as the government pushes its “5 mega-regions and 3 special zones” development strategy aimed at strengthening regional AI competitiveness.
Under the new law, AI data center projects designated as national strategic facilities will undergo integrated approval procedures through deliberation by the National AI Strategy Committee. The measure also exempts certain non-metropolitan AI data center projects from power grid impact assessments when building, expanding or converting facilities below a specified scale.
Industry officials and researchers said the law could significantly speed up the establishment of AI infrastructure in regional areas by reducing regulatory barriers and shortening approval timelines.
Science and ICT Minister Bae Kyung-hoon welcomed the legislation, saying it creates the foundation for what he described as an “AI highway” capable of attracting large-scale overseas investment amid intensifying global competition in artificial intelligence.
One of the most closely watched provisions during the legislative process – a special exemption for LNG-based direct power purchase agreements, or PPA – was ultimately removed from the bill.
The Ministry of Science and ICT and the Ministry of Climate and Energy reportedly concluded that the current national electricity supply system would be sufficient to meet AI data center demand over the next five years. The two ministries are also expected to sign a memorandum of understanding to strengthen coordination on stable power supply measures.
Experts said the exclusion of the LNG PPA provision reflected broader concerns over electricity market stability and national power allocation priorities.
Choi Kyung-jin, a law professor at Gachon University, said the decision was “regrettable but reasonable” given the country’s overall electricity supply conditions.
“The government appears to have considered potential price distortions in the electricity market and the importance of LNG in supplying power to the broader public,” Choi said.
He added that renewable and environmentally friendly energy sources are likely to become increasingly important as regional AI data centers expand.
“Local governments with strong renewable energy infrastructure and expertise in related technologies will have a competitive advantage in attracting and operating AI data centers,” he said.
— Reported by Asia Today; translated by UPI
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