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KEPCO to sell overseas

coal power plants to shore

up finances

SOUTH KOREA SOUTH Korea’s Korea Electric Power Corp. from private power generation companies.
(KEPCO) is to sell up to all its overseas coal-fired The cap would be imposed temporarily
power plants in a bid to offset recent financial whenever the marginal price climbs unreason-
losses and to reduce its global exposure to fossil ably, the ministry said. It plans to compare the
fuels. average SMP for the preceding three months to
The news comes after KEPCO posted a loss monthly averages over the past 10 years.
of KRW7.7 trillion ($6.1bn) in the first quarter This would allow KEPCO to rein in the cost
of the year due to high global energy costs and a of buying electricity from private generators.
freeze in domestic electricity rates. However, private power generation firms are
KEPCO said this week that it would “seek unlikely to be happy with this, so the ministry
all possible options”, including the restructur- said it would compensate them if their power
ing of overseas businesses, property sales and generation fuel costs exceeded the cap on the
other cost-cutting measures in a bid to boost its SMP.
finances. The SMP reached KRW202.11 per kWh
KEPCO has said it will sell a thermal power in April, recording a surge by 164.7% from
plant (TPP) in the Philippines city of Cebu, as KRW76.35, posted a year earlier.
well as a solar power plant in the US. Policymakers have scrapped a method of
It is also reviewing withdrawing from other conducting rate hikes on households and busi-
overseas coal power plant projects in phases, nesses, in light of serious inflationary pressure.
and selling off some gas power plants in foreign The cap on SMP, as an upper ceiling of prices,
countries. is an alternative to stemming KEPCO ’s further
KEPCO said that such sales would save the losses.
company about KRW1.9 trillion ($2bn). In 2021, KEPCO posted the largest deficit
Meanwhile, the South Korean Ministry of based on yearly performance with an operating
Trade, Industry and Energy said this week that it loss of KRW5.8 trillion owing to high import
would place a cap on the “system marginal price,” prices of international crude, which is used for
the price KEPCO pays when purchasing power power generation.™

Week 22 25•May•2022 www. NEWSBASE .com P9