The new chief of Korea Electric Power Corp. (KEPCO) on Wednesday called for "normalizing" electricity rates while pushing for a complete overhaul of the state utility firm to overcome its financial difficulties and become a global energy company.
Kim Dong-cheol, a former four-term lawmaker, made the remarks as he took up the top post of the utility company struggling with snowballing losses.
"Our imminent goal is overcoming the current financial difficulties. It is urgent to normalize electricity rates, particularly given rising global oil prices and a strengthening U.S. dollar," Kim said.
"The ecosystem of the electricity industry is feared to break down. Energy rates that come below production cost would raise our energy imports and aggravate a trade deficit," he added.
As of end-June, KEPCO's total debt had come to 201.4 trillion won ($151.49 billion), the largest amount among all Korean listed firms.
Last year, KEPCO suffered a record-high operating loss of 32.63 trillion won, more than quadruple from a year earlier, as the government failed to raise the energy rates enough to cover soaring costs amid high inflation, and growing public burdens over the COVID-19 pandemic and an economic slowdown.
Kim, at the same time, stressed the need to create new sources of revenue to reduce the company's dependence on electricity bills.
"We need to have more than 30 percent of our total revenue from fields other than domestic electricity sales," he said. "Facing this desperate crisis, KEPCO must go forward with a firm determination to completely revamp the company."
Ways to achieve a longer-term development he presented include the development of advanced technologies in new energy fields and a comprehensive platform that provides various services to relevant companies, the push for offshore wind power and other new renewable energy projects, and boosting exports of nuclear power plants.
In an effort to address debt issues, KEPCO has vowed to push for a set of reform measures, such as property sales, restructuring overseas businesses and freezing workers' wages.