Korea Electric Power Corporation (KEPCO) posted the best results since its founding last year. Profitability improved significantly on the back of lower global fuel prices, 2024 rate adjustments, and efforts to secure fiscal soundness.
KEPCO said on the 26th that, on a consolidation basis, operating profit was tentatively tallied at 13.5248 trillion won, up 61.7% from a year earlier, and revenue rose 4.3% to 97.4345 trillion won. Net profit for the same period came to 8.7372 trillion won, up 141.2%.
As the average import price of liquefied natural gas (LNG) fell 13.4%, the system marginal price (SMP), the wholesale power price, dropped 12.2% from 128.4 won per kWh (kilowatt-hour) in 2024 to 112.7 won last year.
Electricity sales volume decreased 0.1% from 549.8 TWh (terawatt-hours) in 2024 to 549.4 TWh last year, but as the sales unit price rose 4.6% from 162.9 won per kWh to 170.4 won over the same period, electricity sales revenue increased by 4.1148 trillion won.
KEPCO assessed that operating profit improved significantly thanks to diligent execution of its fiscal soundness plan, including expense cuts, business adjustments, sales system improvements, and the sale of non-core asset.
However, despite the record results, KEPCO explained that cumulative operating losses from the spike in global energy prices caused by the Russia-Ukraine war in 2021–2023 have not been resolved. At the time, the company was unable to raise electricity rates in a timely manner and supplied power at prices below cost, sharply increasing losses.
KEPCO's total liabilities on a consolidation basis last year stood at 205.7 trillion won, up slightly from 205.4 trillion won a year earlier. Borrowing fund totaled 129.8 trillion won, down 2% from 132.5 trillion won the previous year. It is paying 11.9 billion won in interest per day.
KEPCO plans to focus on restoring financial soundness by paying interest on borrowing fund and repaying principal.
A KEPCO official said, "We plan to pursue power market system improvements to reduce purchased power costs and high-intensity self-rescue efforts, and to prepare various funding procurement measures," adding, "We are reviewing reasonable rate system reforms that consider the burden on industry, including seasonal and time-of-use rate overhauls and the introduction of regional rates."