Power Generation 5 Companies and Korea Hydro & Nuclear Power Spent 5.1 Trillion KRW on Renewable Energy Purchases Under Moon Administration... Twice Their Net Profit

Office of Yang Geum-hee, People Power Party... "Increased Burden on Citizens Due to Electricity Rate Hikes"

[Sejong=Asia Economy Reporter Kwon Haeyoung] It has been revealed that five power generation companies under Korea Electric Power Corporation (KEPCO) and Korea Hydro & Nuclear Power (KHNP) have spent more than 5 trillion won on purchasing renewable energy such as solar and wind power over the past four years since the Moon Jae-in administration took office. As power generation public enterprises increased renewable energy generation facilities in line with the government's 'decarbonization' policy while simultaneously purchasing externally produced electricity, related costs have surged sharply. This is seen as a factor that further burdens the financial strain of power generation public enterprises amid rising fuel cost burdens due to high oil prices.

According to data submitted by KEPCO and power generation public enterprises to Rep. Yang Geum-hee of the People Power Party on the 12th, from 2017 when the current government took office until 2020, the total cost of purchasing Renewable Energy Certificates (REC) by the five power generation companies under KEPCO and KHNP amounted to 5.1152 trillion won. Public and private operators with power generation facilities of 500 MW or more are required under the Renewable Portfolio Standard (RPS) to supply a certain portion of their total power generation from renewable energy each year. To meet this ratio, they purchase RECs from private solar power operators in addition to their own power production. This means they are buying more than 1 trillion won worth of power annually from external power producers.

The cost of REC purchases by power generation companies increased from 821.1 billion won in 2016 to over 1 trillion won in 2017 when the current government took office, reaching 1.8549 trillion won in 2020. This has exceeded the level that power companies can bear. The net income earned by the five power generation companies and KHNP over the past four years was 2.1943 trillion won, which is less than half of the REC purchase cost (5.1152 trillion won) during the same period.

Rep. Yang Geum-hee pointed out, "Despite their poor financial structure, power generation public enterprises are spending huge costs on purchasing renewable energy such as solar and wind power in accordance with government policy," adding, "The increase in debt of power generation public enterprises will ultimately lead to a burden on the public, such as electricity rate hikes."

This content was produced with the assistance of AI translation services.