KEPCO posted record deficit of over 32 trillion won last year

Korea Electric Power Corporation (KEPCO), a state-owned power generation company, posted a record deficit of 33 trillion won in 2022. It is the worst operational performance ever, with its operating losses 5.6 times larger than the previous record in 2021. Korea Gas Corporation (KOGAS), another state-affiliated power generation entity, also saw its debt levels surge as its outstanding receivables in 2022 reached nine trillion won. Concerns are rising over the possibility of yet another rise in public utility charges as these state-run corporations announced terrible performance results.

KEPCO announced on Friday that its accumulative operating losses were over 32.603 trillion won in 2022, according to its consolidated financial statements. The figure surpassed the previous record losses in 2021 at 5.846 trillion won. The deficit in the last quarter of 2022 is 10.767 trillion won, breaching the previous quarterly record loss of 7.787 trillion won in the first quarter of the same year.

KEPCO reported a 17.5% increase in year-on-year sales last year since energy demands and the unit price rose. However, its operating costs also soared by 56.2% due to hikes in the import prices of energy including LNG and coal, widening the corporation's losses.

KOGAS announced on February 24 that its debt levels reached as high as 500%, a 121-percentage-point increase from the previous year as its outstanding receivables for civilian use (losses caused by unit purchase cost higher than unit sales cost) rose to 8.6 trillion won. KOGAS decided not to give out dividends in order to improve its financial health.

Those devastating business operation results are again increasing the possibility of another energy price surge. The government said that it planned to raise energy prices incrementally in 2023. However, some forecast that the increase may be postponed due to inflation concerns and general elections in 2024.


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