KEPCO Suffers Massive Loss in Q1

KEPCO has posted a record W629.9 billion operating loss during the first three months of this year, the power provider said on Tuesday (US$1=W1,189).

The loss is twice as large as investors had feared and W500 billion more than the loss it suffered in the same period last year. It translated into a net loss of W761.2 billion, up W501.7 billion on-year.

The loss is believed to stem from the government's phase-out of nuclear energy, although both the government and KEPCO deny it.

KEPCO's unit purchase cost for electricity from renewable sources excluding hydroelectric power rose 56 percent over the last three years. That counters the Moon administration's promise that power generation costs would drop due to declining equipment prices as a result of technological development, like cheaper and more efficient solar panels.

In contrast, unit purchase costs for electricity generated by nuclear plants fell 11.6 percent over the same period.

Liberty Korea Party lawmaker Jung You-sub said, "The government claims that advances in renewable energy technology will consistently lower electricity costs, but the exact opposite happened. KEPCO's financial condition is worsening drastically due to the government's nuclear phase-out."

KEPCO instead blamed rising global oil prices, which increased the price of buying electricity from private suppliers by W700 billion, while profits from power sales dropped by W300 billion.