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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] SEOUL / ULSAN, November 6 (local time) — A flagship project by SK Group in partnership with Amazon Web Services (AWS) to build South Korea’s largest artificial-intelligence (AI) data centre at the Mipo Industrial Complex in Ulsan has been dealt a setback after the site failed to secure designation as a “Distributed Energy Special Zone” under the government’s new policy.
The decision by the Ministry of Climate, Energy and Environment (MOCIE) on 5 November officially selected four regions—Jeju, Jeonnam, Busan Gangseo and Gyeonggi Uiwang—as distributed-energy zones, while Ulsan Mipo, along with Seosan (Chungnam) and Pohang (Gyeongbuk), were placed in “designation deferred” status. Official reasons were not disclosed, but the outcome has triggered concern among Ulsan city officials and industry groups.
The SK-AWS project announced in June envisions a 36,000-square-metre campus equipped with approximately 60,000 graphics-processing units (GPUs) for generative-AI workloads, with phased capacity beginning from 2027 and full build-out by 2029.
The site was chosen in part because of its proximity to an LNG combined heat-and-power plant operated by SK Gas, allowing for a stable and large-scale power supply—a key competitive edge for AI infrastructure.
Industry analysts say the failure to secure special-zone status may impact the data centre’s cost structure and timeline given that reduced transmission-constraint access and less favourable electricity contracts could raise operating costs. Local officials expressed surprise at the decision, noting that the project had previously been supported at the highest levels of government; the President himself attended the launch-event earlier this year.
SK Group and AWS now face the challenge of proceeding without regulatory tailwinds initially expected under the special-zone framework—or seeking alternate arrangements to secure affordable power for the high-density AI facility.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
