KEPCO to raise power prices for big firms, sell assets amid mounting losses

SEOUL, The state-run Korea Electric Power Corp. (KEPCO), the dominant electricity supplier in the nation, said Wednesday it will increase power prices for big companies and sell some of its assets as it is struggling with mounting losses.

KEPCO said, however, it will freeze electricity prices for households and small and medium-sized firms amid concerns about high inflation.

The new rates, effective Thursday, will increase the average cost by 10.6 won (US$.01) per kilowatt-hour (kWh) for “large-capacity” industrial uses, the company said in a statement.

“As households and self-employed individuals are facing burdens amid the prolonged inflation and high borrowing costs, we have decided to freeze rates for them and adjust the pace of increase,” KEPCO said in a statement.

The company has been under pressure to increase electricity prices as it has suffered accumulated deficits of 47 trillion won.

This file photo, taken June 19, 2022, shows electricity meters at a building in Seoul.

“We plan to review the rate adjustment by closely monitoring global energy prices and foreign exchange rates,” it added.

The company earlier raised the electricity rates by 5.3 percent on-year for households in the second quarter, or 8 won per kilowatt hour (kWh), following a 13.1 won increase per kWh in the first quarter.

As part of its cost-cutting measures, KEPCO has additionally disclosed its plans to offload assets, which will include properties and stakes.

KEPCO will sell 20 percent of the stake in its wholly owned subsidiary KEPCO KDN Co., an ICT service provider, as well as its entire share of 38 percent in the Philippines’ Calatagan solar energy project.

The company added it will also sell its 640,000-square-meter plot in northern Seoul, including its education and training facility.

Additional cost-cutting measures involve optimizing the organizational structure by merging similar divisions and downsizing the workforce by 700 employees by 2026.

The latest self-rescue measures came on top of the previous plan announced in May to save 25 trillion won over the next five years.

Source: Yonhap News Agency