KEPCO President: "Cannot Reflect Cost in Electricity Rates"... The 'Fuel Cost Linkage System' Becomes Useless

Jung Seung-il President: "Electricity Rates Were Not Flexibly Adjusted According to Oil Prices"

Jung Seung-il, President of Korea Electric Power Corporation, attended the National Assembly inspection on the 12th held by the National Assembly's Industry, Trade, Energy, Small and Medium Venture Business Committee regarding Korea Electric Power Corporation, and is reporting on business operations. Photo by Yoon Dong-joo doso7@

[Sejong=Asia Economy Reporter Haeyoung Kwon] Jung Seung-il, CEO of Korea Electric Power Corporation (KEPCO), stated on the 12th that the deterioration of KEPCO's financial structure is due to insufficient increases in electricity rates.

At the National Assembly's Industry, Trade, Energy, Small and Medium Enterprises Committee's audit held that day, in response to a question from Shin Jeong-hoon, a member of the Democratic Party of Korea, asking about the root cause of KEPCO's chronic operating losses, he explained, "A major factor is the failure to properly reflect the costs required for power generation in the electricity rates."

Regarding Shin's mention of the need for a rate system that reflects costs unaffected by political logic for energy supply and demand, as well as operating losses, he said, "I agree."

In response to criticism that KEPCO's reckless management is the cause of the financial deterioration, he drew a line by saying, "While we will tighten wherever possible, it is unreasonable to say that losses occurred due to reckless management." He added, "Crude oil prices are very closely related to KEPCO's management," emphasizing again, "Nevertheless, the rates were not adjusted flexibly (in accordance with crude oil prices)."

Furthermore, CEO Jung stated that he would consider a plan to transparently disclose factors causing electricity rate fluctuations due to the expansion of renewable energy generation. He explained, "It is still difficult to estimate the cost of achieving carbon neutrality due to the difficulty in judging the speed of technological progress," adding, "There needs to be a discussion on how to fairly distribute a certain portion of the increased costs among generations. Once the government's plan is finalized, we will carefully consider and inform the public."

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