DPRK IMPORTS OF GENERATORS IN
RECENT YEARS: AN INDICATION OF
GROWING CONSUMER CHOICE AND
INFLUENCE ON ENERGY SUPPLYDECISIONS?

Recommended Citation
David von Hippel and Peter Hayes, "DPRK IMPORTS OF GENERATORS IN RECENT YEARS: AN
INDICATION OF GROWING CONSUMER CHOICE AND INFLUENCE ON ENERGY SUPPLYDECISIONS?", NAPSNet Special Reports, November 02, 2018, https://nautilus.org/napsnet/napsnetspecial-reports/dprk-imports-of-generators-in-recent-years-an-indication-of-growng-consumer-choice-and-influence-on-energy-supply-decisions/

DAVID VON HIPPEL AND PETER HAYESNOVEMBER 2, 2018
I. INTRODUCTION
In this Special Report, the authors find that “the data on generator imports ...reinforces a picture ofa DPRK in which a more vibrant, modernizing, increasingly (at least functionally) market-based
1economy is providing households, business, and institutions with the wherewithal to invest in bothoff-grid electricity supplies and increased transport services…To the extent that private purchase ofgeneration equipment has rendered DPRK decision-makers less vulnerable to the impact of oil
supply sanctions—the implication IS that other modes of working toward “denuclearization” of the
DPRK, particularly engagement on energy issues, are likely to be more effective than attempts tofurther ratchet up sanctions.”
David von Hippel is Nautilus Institute Senior Associate. Peter Hayes is Director of the Nautilus
Institute and Honorary Professor at the Centre for International Security Studies at the University ofSydney.
The views expressed in this report do not necessarily reflect the official policy or position of the
Nautilus Institute. Readers should note that Nautilus seeks a diversity of views and opinions on
significant topics in order to identify common ground.
This report is published under a 4.0 International Creative Commons License the terms of which arefound here.
Banner image: Chinese genset sold to DPRK, from here.

II. NAPSNET SPECIAL REPORT BY DAVID VON HIPPEL AND PETER HAYESDPRK IMPORTS OF GENERATORS IN RECENT YEARS: AN INDICATION OF
GROWING CONSUMER CHOICE AND INFLUENCE ON ENERGY SUPPLYDECISIONS?
NOVEMBER 2, 2018
Introduction
Although anecdotal evidence, including informal reports from recent visitors to the Democratic
People’s Republic of Korea (DPRK), suggest that supplies of electricity have been improving
somewhat in recent years, at least in some areas of the country, many areas of the country
reportedly continue to experience periodic blackouts. These episodes are caused by a combinationof factors that vary place to place. Factors affecting power supply include the poor condition of thetransmission and distribution grid and related power losses. Lack of power supplies due, forexample, to seasonal reductions in hydroelectricity output, lack of fuel for and/or technical problems
at coal-fired power plants, and/or a general lack of sufficient operable power generation to meetdemand, result in the rationing of electricity to certain areas by allocating available supplies topriority areas and organizations. The historical lack of a pricing system that collects fromconsumers even a fraction of the cost of generating power does not help to provide incentives for
improvement of central electricity supplies, which are in any event government controlled. As aresult, some cities, most notably Pyongyang, have relatively reliable supplies of power (though even
there, blackouts remain not uncommon), whereas more remote areas can be without power much of
the time.[1]At the same time, the last few years have generally seen (again, largely based on anecdotal
evidence, as few statistics are available) an uptick in economic activity, as more DPRK citizens are
participating in a market economy that has been increasingly tolerated by DPRK officials. The
expanding market economy, in turn, has increased the ability of some individuals to access andafford imported goods and fuel, and to seek expanded access to energy services such as lighting, theuse of personal electronics, and personal mobility.
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In an earlier NAPSnet Special Report, we described a large increase over the last five or so years in
the imports of vehicles—ranging from heavy trucks to personal autos and motorcycles, bicycles, andperhaps most interestingly, electric scooters and electric bicycles—reported in customs statistics.[2]A parallel increase has occurred in the imports of devices—mostly diesel- or gasoline-fueled
generators, but also solar photovoltaic (PV) and wind-power generators—that allow North Koreansto generate their own power for businesses and households. The combination of these trends
suggest to us that increasingly North Korean households—at least the wealthier ones—and perhaps
businesses have taken the provision of both transport services and electricity provision into theirown hands.
This situation implies that consumers must make their own trade-off--to the extent that fuel supplies
are squeezed by United Nations Security Council (UNSC) sanctions--between fueling transport or
fueling back-up power supply, but by devolving these choices to individual households and work
units, it also implies that North Koreans’ responses to scarcity of electricity (and public transport)
have ended up providing additional resilience, at least for the most elite North Koreans, to weather
the potential hardships of the sanctions regime.
Imports of Small Petroleum-fueled Generators to the DPRKThe DPRK has imported small generators, particularly diesel generators, for at least 25 years. All
but a small handful of these generators have been imported from China. Imports of generators
under the general category HS 8502, based on trade statistics available through the United Nations“Comtrade” data system[3] numbered mostly in the tens of units until 2000, when they began to riseto hundreds and then over a thousand units per year by the late 2000s. Since then, and particular in
the last five years, imports of generators have expanded dramatically, to tens of thousands of units
per year (albeit mostly of smaller capacity), with the peak year for reported imports being 2015,
when the value of the DPRK’s imports for HS 8502 totaled over $25 million (US dollars). Table 1
shows the reported number of generators exported to the DPRK by its trade partners (almost allfrom China). These imports are divided into several types and categories, namely:
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●

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●

Diesel-fueled generators of less than 75 kilowatts (kW) capacity (or, more accurately less than 75
kilovolt-Amps, which is effectively the same as kW). These would be sufficient, at the low end (say10 kW), to power a reasonably large home, and at the high end, to power a cluster of homes or asmaller apartment building, or a smaller business (such as the marketplaces that have opened up
throughout the DPRK) or institution (school or hospital). Nearly 3000 of these units were imported
in the peak year of 2015, and nearly 15 thousand were imported since 1993, of which two thirds
were imported after 2010.
Diesel-fueled generators of between 75 and 375 kW. These would be sufficient to power, forexample, a medium-sized business or institution, or a moderate-sized apartment building. Over
800 of these were imported in 2015, and nearly 3700 since 1993, with over 70 percent of the totals
brought in after 2010.
Diesel-fueled generators of more than 375 kW. These could be sufficient to run a light industrial
facility, or a larger office building, apartment complex, or institution (a military base comes tomind as an example of the latter), or even a village of a few hundred to a few thousand
inhabitants. Nearly 400 of these were imported since 1993, including 81 in 2015, and 290 after2010.
Spark ignition (largely gasoline-fueled) unit. The HS category for these provides no guidance as tocapacity, but we infer that they are mostly small units of 500 Watts to a perhaps a few kW of
output, used to provide emergency or back-up power for key end-uses (lighting andcommunications) and for charging batteries to run lighting and smaller appliances in homes3and/or, for example, for powering one or several stalls at a night market. Although hardly any ofthese were reported imported to the DPRK in the 1990s, by 2015, the DPRK imported a staggering
53,000 of these units, or nearly one for every hundred DPRK households in that year alone. By
2017, imports in this category were almost 200,000 units, of which over 80 percent had beenpurchased since 2010.
●●

Wind power generators, numbering nearly 600 since 1993, but almost all imported since 2007,
with peak imports of 175 units in 2012.
Purchase of about 16,000 generators of unspecified type and size, but assumed to mostly be diesel
generators, have been reported starting in 2009, and with peak purchases of 4,700 units in theyear 2015.

Table 1: Number of Generators Imported to the DPRK by Year and HS Category
We were interested in how these trade statistics for generators, which provide information on thecost, number, and sometimes weight of shipments, but not the total capacity of generators shipped,
might translate into figures for total capacity of generators imported. To estimate capacity by year,
we adopted estimates of the average kW per unit in each trade category, then tuned those estimates
so that the cost of capacity per kW ($/kW) approximately matched the costs of generators offered forsale in the various size and fuel categories by vendors, and in particular, by Chinese companies
advertising generators on Alibaba.com. This procedure cannot hope to exactly reproduce thecapacity imported in each year, but we feel it provides a reasonable estimate. As an example, ouranalysis suggests that in 2015, the aggregate cost of the 53,000 spark-ignition generators imported
would be consistent with an average unit size of about 2 kWe and an average cost of about $160 per
unit ($80 per kW), well within the range of sizes and costs of small Chinese-made generators offered
for sale on Alibaba and, significantly, probably within a range of affordability for at least more wellto-do North Korean households.
Figure 1 shows the results of our estimates in terms of cumulative capacity of the diesel- andgasoline-fueled generators imported to the DPRK since the early 1990s. Notable here is thesignificant ramp-up of capacity since 2000, and particularly since 2010. Also notable is the estimateof total capacity—at over 900 MW of diesel gensets and 400 MW of gasoline generators, they total
1300 megawatts (MW), or 1.3 GW, of (presumably) operable generation capacity. This is similar in
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magnitude to what we estimate may be the actual operable capacity of the DPRK’s thermal (mostly
coal-fired) power plants,[4] and perhaps a quarter or more of the total operable capacity of the
DPRK’s central power plants in total, thermal plus hydroelectric. This means that by 2017, theamount of generation capacity in these individual generators was starting to be a significant fractionof the usable capacity of central station power generation.
Figure 1:

Although the total cumulative capacity represented by these (largely) diesel generators imports is
estimated to be over 1 GW, a significant difference between these units and central-station coal andhydro power is their much higher fuel costs.
Fuel Use by Diesel and Gasoline Generators
As petroleum products in the DPRK are either imported (mostly from Russia and China) or refinedfrom the limited crude oil supplies imported from China, fueling diesel or gasoline generators
represent significant costs to their owners—on the order of $0.30 per kWh generated for dieselfueled generators, and $0.80 per kWh for gasoline generators, based on recent anecdotal reports offuel prices in the DPRK ($0.85 per kg for diesel, and $1.24 for gasoline).[5] These per-unit fuel costs
are compounded by the relatively low average efficiencies of diesel- and gasoline-fired generators,
particularly when operating at less-than-full loads. On the other hand, even at low capacity factors,
the relatively low cost of these generators makes their capital costs per unit of output quite low, on
the order of a few US cents per kWh. In addition, even though the fuel cost per unit output is high,if the annual use is low—maybe even 30 minutes per night, to charge batteries, which in turnprovide power for lighting, small appliances, and charging electronic devices throughout the day. As
such, for example, homes using gasoline generators may face annual fuel bills on the order of a few
hundred to a few thousand dollars—significant, but probably affordable for richer households.
Although we have not yet completed our analysis of the DPRK energy sector for 2017, if we assume
that average capacity factors for the cumulative stock of imported diesel and gasoline generators areeven in the single digits in percentage terms (hundreds of hours per year) it implies that a very
substantial fraction of the diesel and gasoline thought to be available to the DPRK, even including
off-books trades, is being used by individuals, businesses, and organizations to generate power. This5

implies a competition for what fuel supplies do get to the DPRK between this off-grid electricity
generation and the provision of services for passenger and freight transport.
Imports of Photovoltaic Panels
Another, even lower-cost approach that many DPRK households, businesses, and institutions havetaken to provide small amounts of power when grid electricity is unavailable is the use of small solar
photovoltaic panels, which provide electricity at zero fuel cost.[6] Coupled with batteries andincreasingly efficient LED (light-emitting diode) lightbulbs and fixture, these panels have sprouted
from rooftops, balconies, and the sides of buildings in many locations throughout the DPRK over thelast decade. Costs of PV panels, and of batteries and LED lights, particularly from China, have fallen
significantly over time, and as a consequence, imports of these devices to the DPRK (almost all from
China) rose significantly through 2016. Figure 2 shows estimated annual and cumulative imports of
PV panels from 2009 through 2017. In the peak year of imports, 2015, approximately $8.5 million ofdevices in the solar PV trade category were imported by the DPRK. Over time, the average size ofpanels imported appears to have risen, from panels averaging a watt or less (perhaps 10 cm by 10cm) to an average of over 10 watts (20 cm by 50 cm or so) by 2015. The total estimated cumulative
capacity of PV panels imported by the DPRK, at nearly 30 MW by the end of 2017, remains quite
small relative to both the DPRK’s overall power needs and the capacity of diesel and gasoline
generators imported, but these affordable units—perhaps on the order of $10 to $40 each—provide
much-needed energy services to DPRK households at a reasonable price. We estimate that the perunit-output costs of ownership of these PV panels had fallen to on the order of $0.11 per kWh by
2017.[7] By way of comparison, this cost is still more expensive than DPRK grid electricity, which
has historically been mostly un-metered; households have typically been charged a flat rate permonth, sometimes based on an estimate of their usage, and sometimes not. Recently, electricity
meters have started to be installed in Pyongyang, in some cases with prepaid cards allowing the useof a specific quantity of electricity, and the historically negligible charges for electricity have risen.
Still, reports suggest that the base price of electricity charge is on the order of the equivalent of
0.45 US cents per kWh, rising to a still-low 4.5 cents per kWh for consumption over 100 kWh(presumably, per month).[8] Power provided by PVs therefore remains above even these recent
higher electricity prices being charged in Pyongyang, but is much less costly, for example, than theoutlays required if disposable batteries are used to power small devices.
Figure 2:6Note that it is our assumption that the vast majority of PVs used in the DPRK are imported from
China, not manufactured in the DPRK. A KCNA [check] YouTube video shows an assembly line for
PV panels in the DPRK, but we do not know what the capacity of this facility, and other similar
plants, might be. We suspect, however, that whatever the capacity of these plants, they are
significantly less than the volume of PV panel imports by the DPRK, and it seems highly likely thatthe basic PV cells assembled into panels by these plants are imported from China.
Imports of Wind Power Generators
The DPRK has significant wind resources in a few regions, including along the mountainous “spine”
of the country and in the far Northeast, near the Russian border. Much of the rest of the nation has
only moderate average annual wind resources. Although wind power has long been of interest to
the DPRK, imports of wind power units have been modest relative to PV panels or diesel/gasolinefueled generator sects. Figure 3 shows DPRK imports of wind power generators over the last
decade. These peaked at an estimated 300 kW in 2012, and add up to a cumulative value of a bitover 800 kW by 2017. This is likely an under-estimate of the total wind power capacity in the DPRK,
as there will likely be some domestically-produced (both factor-made and homemade) wind power
generators. The operability of these domestically-made units, however, at least based on Nautilus’
visit to a factory in Pyongyang in 2000 (admittedly a potentially dated observation), may not be
similar to that of imported units.
Figure 3:7

Reported Imports of Generators, PVs, and Wind Power Have Fallen since 2015
An element of each of the graphs shown above is a decline in the imports of generating devices
reported in customs statistics since 2015 (earlier for wind power). Exactly what has caused thisdecline we cannot say, but we expect that it is the result of a combination of factors, possibly varying
by product, including:
●

●

●

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Possible saturation of the market for, in particular, small fuel-fired generators and solar PVs, as
most of the households that can afford such units have already purchased them.
Saturation in the market for the households and organizations that can afford the market costs fordiesel and gasoline, or who have access to fuels through state distribution channels, as well as
perceptions by potential generator buyers of possible restrictions in fuel supplies. It may be thatthe higher prices of diesel and gasoline experienced by DPRK consumers in the last two years(though prices have fallen again) have deterred potential buyers of generators.
Slightly better supplies of grid electricity, and/or lower cost, higher-capacity batteries, allowing
households to use grid electricity for more of their needs and/or use intermittent grid electricity,when available, to charge batteries for use during blackouts.
A reduction in funds available to pay for imported generation equipment due to reduction innational and personal incomes due to UNSC sanctions on DPRK export commodities such as coal.
Restrictions on imports to the DPRK due to enforcement of UNSC sanctions by Chinese authorities,
and/or due to a reduction in exports by Chinese firms concerned about running afoul of sanctions
by trading with the DPRK.

As our information on volumes of imports comes exclusively from customs statistics, it is possible, ofcourse, that some or all of the decline in imports of these devices is not actually a decline at all, but
merely reflects an increase in trades that occur “off-books”. Without admittedly difficult-to-obtain
information on the extent of these trades (if they occur), we have no way of knowing how important
this factor may be in explaining the overall reduction in reported exports to the DPRK.
Conclusions
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Taken together with the recent trends in customs statistics on transport equipment that we
described in earlier Special Reports, the data on generator imports described above reinforces a
picture of a DPRK in which a more vibrant, modernizing, increasingly (at least functionally) marketbased economy is providing households, business, and institutions with the wherewithal to invest in
both off-grid electricity supplies and increased transport services. As these trends continue, it ispossible that:
●

●

●

●

●

●

A set of trade-offs for DPRK authorities and citizens/organizations buying fuels on the (partially
open) market are coming into play (or already existing), in which there is a choice between
generating power when the grid is not available or using more transport services. These choices
will become more stark (or less) to the extent that UNSC sanctions on oil supplies are effective (orare not) in reducing the availability of fuels in the DPRK.
Although it is unlikely to be important on a national scale, at least at present, the combination ofsolar PV purchases and the recent vast increase in the purchase of what are probably electricscooters and similar electrified personal transport (see our earlier Special Report) brings up some
intriguing questions. Are DPRK households using solar PVs to charge scooter batteries? Are theyusing scooter batteries, charged by PVs, generators, or the grid, to provide other services, such as
power for lighting, small appliances, and/or personal electronics (cell phones, DVD players, TVs)?
If so, then the DPRK may be ahead of the curve in integrating electrified personal transport andelectricity supply.[9]By spurring imports of off-grid generation equipment, the unreliable nature of the DPRK grid itself
appears to have contributed to a degree of resiliency to the impact of sanctions on the part of, atleast, relatively well-off households (including, for example, well connected party and militaryfamilies). This means, that at least for these families—who control much of politics and theeconomy in the DPRK—the personal impact of sanctions on their lives may well be bufferedsignificantly, depending in large part on the degree to which off-books oil supplies make it into the
DPRK.
Similarly, the purchase of generation equipment, including larger solar arrays and diesel
generators, may have made some of the institutions targeted by sanctions, including military
installations, more flexible in terms of energy supply, and less vulnerable to the impacts ofsanctions.
To the extent that the above turns out to be true—that private purchase of generation equipment
has rendered DPRK decisionmakers less vulnerable to the impact of oil supply sanctions—theimplication would be that other modes of working toward “denuclearization” of the DPRK,
particularly engagement on energy issues, are likely to be more effective than attempts to further
ratchet up sanctions.
These individual purchases suggest that proceeding to refurbish the grid from “bottom-up” using
micro-grids powered by renewables and limited coal-fired backup power may be more efficientthan reconstructing the DPRK grid “top down” with a focus on large-scale generators.

III. ENDNOTES[1] See, for example, Andrei Lankov (2017), “How North Korea’s electricity supply became one of
the world’s worst”, NKNews.org, dated May 31, 2017, and available ashttps://www.nknews.org/2017/05/how-north-koreas-electricity-suply-became-one-of-the-worlds-worst/.
[2] David von Hippel and Peter Hayes (2018), "DPRK Motor Vehicle Imports from China, 2000-2017:
Implications For DPRK Energy Economy", NAPSNet Special Reports, August 23, 2018, available as9https://nautilus.org/napsnet/napsnet-special-reports/dprk-motor-vehicle-imports-from-chna-2000-2017-implications-for-dprk-energy-economy/.
[3] Available as https://comtrade.un.org/data.
[4] Nautilus’ updated estimates of overall electricity generation in the DPRK are still in process, but
for 2014 we estimated the total output of DPRK coal-fired and hydroelectric generators at about
14,000 TWh (terawatt-hours, or billion kilowatt-hours), the equivalent of about 3 GW of capacity
operated an average of about 50 percent of the time at full capacity (that is, at a 50 percent annual
capacity factor).
[5] Hyonhee Shin (2018), "Exclusive: North Korean fuel prices drop, suggesting U.N. sanctions being
undermined", Reuters, dated July 24, 2018, and available as https://www.reuters.com/article/usnorthkorea-economy-exclusive/north-korean-fuel-prices-drop-suggesting-u-n-sancions-being-undermined-idUSKBN1KE15F.
[6] See our earlier Special Report on this topic: David Von Hippel and Peter Hayes, "Private
Purchases of Solar Photovoltaic Panels in the DPRK: Signs of Green Growth on the Way?", NAPSNet
Policy Forum, dated January 13, 2015, and available as, https://nautilus.org/napsnet/napsnet-polic-forum/private-purchases-of-solar-photovoltaic-panels-in-the-dprk-signs-of-green-growth-on-the-way/.
[7] This calculation assumes an average PV unit lifetime of 15 years, and an average effective
interest or discount rate of 15 percent/yr.
[8] See, for example, Joonho Kim, Leejin Jun, and Richard Finney (2017), “North Korea Installs
Power Meters, Raises Rates in Pyongyang”, Radio Free Asia, dated 2017-11-07, and available ashttps://www.rfa.org/english/news/korea/power-meters-11072017112708.html.
[9] That is, the DPRK may already be implementing, after a fashion, the use of electric batteries asstorage for intermittently-generated electricity, as has been proposed in many nations in recent
years. We would be delighted to hear from colleagues who might have first-hand knowledge of anyof these types of “crossover” uses of electric scooter or bicycle batteries, as they are just conjecture
on our part, at this point.

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