Lee Dong-geol: "No Financial Support Without Government Coal Power Export"

National Assembly Political Affairs Committee Audit, Response to Assemblyman Min Hyung-bae's Inquiry
Min Hyung-bae: "De facto Domestic and International Coal Phase-out Declaration by Korea Development Bank"

[Asia Economy Honam Reporting Headquarters Reporter Yoon Jamin] During the afternoon questioning at the National Assembly's Political Affairs Committee audit held on the 16th, Korea Development Bank Chairman Lee Dong-geol responded, "If the government and Korea Electric Power Corporation (KEPCO) do not export coal power, we will not provide financial support either."

This response from Chairman Lee, which came at the end of questioning by Min Hyung-bae (Gwangju Gwangsan-gap), a member of the Democratic Party of Korea on the Political Affairs Committee, effectively became Korea Development Bank's overseas coal phase-out declaration, as Chairman Lee had been the most reluctant to declare coal phase-out until now.

In the morning audit, Representative Min pointed out that the 2030 coal power plant operation rate estimate in the investment prospectus for the Samcheok Coal Power Plant Project, in which Korea Development Bank participated as the lead underwriter, was inaccurate. According to the National Climate and Environment Council's analysis, the domestic coal power plants' operation rate is expected to fall below 50% by 2030, but Korea Development Bank relied on the advisory group's business feasibility evaluation and assumed an 85% operation rate would be maintained.

In the subsequent afternoon questioning, Min highlighted discrepancies between the calculation process of the adjustment coefficient for the Samcheok Coal Power Plant and the actual investment cost versus the standard investment cost estimated by the Korea Power Exchange, and pointed out that Korea Development Bank might not be able to properly recover loans from Samcheok Blue Power.

In particular, Min reminded of the negative remarks by Minister of Trade, Industry and Energy Sung Yun-mo and KEPCO President Kim Jong-hak regarding overseas coal investments, and asked, "If government ministries or KEPCO say they will not export coal overseas, then Korea Development Bank has no reason to provide financial support, right?"

Chairman Lee replied, "Of course, that would be the case," and when Min repeated, "If the Ministry of Trade, Industry and Energy or KEPCO say they will not export coal overseas, you will not provide financial support, right?" he stated, "There is no need to decide on that; if there is no demand, then it simply won't happen."

Representative Min Hyung-bae said, "Although it is a bit regrettable that the premise was added, the domestic coal phase-out declaration was already made in the morning audit, and the declaration regarding overseas is also a very meaningful step," adding, "Through this audit, I will do my best to end support from government ministries and policy banks for domestic and overseas coal power plants."

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