The biomass power project at Pohang's Yeongilman Industrial Complex is expanding beyond the energy needs of the existing steel and chemical industries into a concept linking it with future electricity-intensive industries such as data centers. Combining a biomass power plant with a 50MW data center is expected to offer a way to attract new industries using a stable electricity supply base and strengthen the region's energy and information technology industry ecosystem. A model linking biomass power generation with a data center to manage electricity, heat and cooling together has been proposed. Using port logistics and industrial complex infrastructure, and combining other energy sources such as solar, wind and batteries where necessary, have also been proposed for consideration. The proposed model represents a possibility at the project concept stage. Implementing it would appear to require comprehensive verification of electricity supply conditions, investment costs, cooling systems, environmental impacts and the ability to secure companies seeking data center capacity.
Data centers' high electricity demand makes a stable supply essential
Data centers require a continuous supply of electricity to operate servers, storage devices and network equipment. Interruptions to the power supply can disrupt services, making a stable electricity supply and emergency power systems important. The concept of linking a 50MW data center with a biomass power plant takes these electricity demand characteristics into account.
If a structure can be established in which the plant generates electricity reliably and the data center consumes it over the long term, it could secure a customer for the power project while expanding the data center's electricity procurement options. However, supply feasibility cannot be determined simply by comparing the plant's installed capacity with the data center's electricity demand. Actual net generation, maintenance periods, fuel availability, grid access conditions and the data center's electricity consumption patterns must all be examined.
The power quality and supply reliability required by the data center must also be considered. Even if the plant generates electricity, the business structure and costs will vary depending on whether electricity is supplied through the grid, whether direct trading is used and what alternative sources are secured for emergencies. Electricity supply and demand simulations and economic analysis linking the operating conditions of both facilities are therefore needed, rather than examining the power project and data center project separately.
Integrating electricity, heat and cooling to improve energy efficiency
Combining a data center with a biomass power plant is significant because it allows heat and cooling systems to be considered alongside electricity supply. Data centers operate cooling equipment to remove heat generated by servers, consuming substantial energy in the process. Linking the biomass plant's combined heat and power generation with heat demand in the industrial complex could improve energy efficiency.
However, recovering and using waste heat from the data center and supplying heat produced at the power plant involve different technical and operating conditions and must be examined separately. Supplying data center waste heat to nearby industrial facilities or other heat users requires compatible temperatures, heat quantities, supply distances and end-user operating conditions. The investment and operating costs of equipment for recovering and transporting heat must also be reflected in the economic assessment.
The cooling system is another important variable. Reference materials propose seawater cooling as a strategic model, but actual implementation requires examination of seawater quality, intake and discharge facilities, corrosion prevention, equipment safety and marine environmental regulations. Introducing seawater cooling does not automatically resolve cooling issues.
Pohang's coastal location is an advantage that could be used, but verification of marine environmental impacts and facility safety must come first. Design standards addressing natural disasters such as typhoons and storm surges also need to be incorporated from the project's early stages.
Yeongilman Port and the industrial complex as a base for attracting data centers
Pohang's Yeongilman Industrial Complex is characterized by a location linking port and industrial facilities. If the biomass power project proceeds, there is potential to use energy infrastructure by considering fuel transport and storage, electricity supply and industrial heat demand together.
Adding a data center could allow an industrial model connecting the power plant, industrial complex and information technology infrastructure to be developed. It could also establish the electricity supply infrastructure needed to operate a data center and create demand in related fields, including equipment maintenance, networks, security and cooling systems.
However, building a data center cannot be assumed to immediately create large-scale local employment. Data centers may have limited permanent operating staff relative to their facility size, and actual employment and regional economic effects vary according to investment scale, operating methods and the composition of partner companies. Increasing regional economic benefits requires a structure enabling local companies to participate not only during construction but also in equipment management, electrical and mechanical maintenance, security and network-related services during operation.
A data center location's competitiveness depends not only on electricity but also on telecommunications networks and fiber-optic infrastructure, land availability, disaster response, water and cooling conditions, and permitting procedures. Alongside highlighting Pohang's locational advantages, it would therefore appear necessary to establish the specific requirements of prospective customer companies.
Investment costs for a 110MW plant and a 50MW data center need verification
According to the materials, construction costs for a 110MW biomass power plant are estimated at approximately 550 billion won or more, excluding land. If a data center is developed alongside it, the investment required for the data center building, servers, electrical equipment, cooling systems, telecommunications infrastructure and emergency power must be calculated separately. Sharing a site does not automatically reduce the combined investment and operating costs of the two facilities.
The economic analysis must consider the plant's fuel and maintenance costs alongside the data center's electricity purchase costs, cooling costs and grid connection costs. Even with a long-term electricity supply contract, the analysis must account for the possibility that costs could change with fuel prices, exchange rates and policy changes.
For biomass power generation in particular, supplies of domestic unused wood may be limited, and imported pellet price volatility may affect commercial viability. Rather than planning electricity supply to the data center solely on the basis of installed plant capacity, supply reliability must be verified against secured fuel supplies and actual generation potential.
Government support and REC-related arrangements may also affect commercial viability, but future support levels or preferential prices would not appear appropriate to treat as guaranteed revenue. The article argues that applicable arrangements and contract conditions must be confirmed before conducting financial analysis that includes conservative scenarios.
RE100 and carbon neutrality require objective verification
A model linking a data center with biomass power generation must consider both energy procurement reliability and environmental performance. Data center operators and global industrial companies are interested not only in electricity supply but also in greenhouse gas emissions from energy use and renewable energy procurement records.
Biomass power generation could contribute to greenhouse gas reductions if it replaces existing fossil fuel-based generation or boilers. However, biomass cannot uniformly be assumed to be carbon neutral. Emissions from feedstock production, collection and transport, as well as changes in forests' carbon uptake, must be examined comprehensively.
Introducing BECCS in the future to incorporate carbon capture and storage could also be considered. However, claims of actual carbon removal would require verification of capture rates, storage permanence, life-cycle emissions, additional energy consumption and costs.
A distributed energy model combining solar, wind and battery storage systems (ESS) could also be an alternative. Combining the generation characteristics of different energy sources could improve electricity supply and demand flexibility, but grid connection, storage investment and the cost of establishing operating systems must all be assessed.
Beyond power plant construction toward an integrated energy business
The concept linking a Pohang biomass power plant with a data center presents a new possibility for connecting the energy and information technology industries using the region's port and industrial infrastructure. Another anticipated benefit is the potential to support electricity and heat demand from existing steel and chemical industries while establishing a base for attracting new industries such as data centers.
However, developing the concept into an actual industrial model requires specific confirmation of whether the power plant and data center projects will proceed, electricity supply conditions, long-term customers, investment costs and feedstock supply chains. Cooling, the marine environment and community acceptance must also be examined.
In particular, the feasibility of attracting a data center and building a power plant must each be verified before separately analyzing the additional benefits and costs of combining the two facilities. The article argues that Pohang should move beyond simply expanding generation facilities toward establishing an integrated energy base connecting regional industrial demand and supply.
If stable fuel procurement, reasonable electricity supply contracts, environmental management and local company participation are designed together, the biomass power project could develop into infrastructure supporting the energy transition and the attraction of future industries at Pohang's Yeongilman Industrial Complex.
Original Korean article: ynenews.kr
English brief by Korea Wind Intelligence, koreawindintel.com
