State-run electric utility company Korea Electric Power Corporation reported an operating loss in 2018 for the first time in six years, due mainly to rising fuel prices and the cost of buying power from its affiliates.
Kepco posted an operating loss of 208 billion won ($184 million) last year, down from an operating profit of 4.9 trillion won the previous year, according to its regulatory filing on Friday. It reported sales of 60.6 trillion won, up from 59.8 trillion won last year.
Last year, fuel prices at Kepco’s power-selling affiliates rose 3.6 trillion won year-on-year in accordance with the global trend. Dubai crude gained 30 percent on-year and liquefied natural gas 16 percent.
The cost of buying power from private power companies rose 4 trillion won last year from the previous year due to higher LNG costs.
South Korea’s efforts to phase out nuclear energy also played a role. Kepco had to find alternative energy sources as it reduced the use of nuclear energy to 65.9 percent in 2018 from 71.2 percent in 2017 in line with the government’s anti-nuclear policy.
But Kepco has downplayed concerns about the government’s anti-nuclear policy and how it may have affected Kepco’s losses.
Park Hyung-duck, Kepco’s chief financial officer, attributed 82 percent of the loss to rising fuel prices and the cost of buying power from its affiliates. Only about 18 percent stemmed from the reduced use of nuclear energy, Park said.
Kepco plans to carry out a “strong” self-help plan this year to save around 2 trillion won and make a turnaround.
By Shin Ji-hye (email@example.com)