Value context and insight. lkm@koreatimes.co.kr
KEPCO desperate to contain losses, root out corruption
Korea Electric Power Corp. headquarters in Naju, South Jeolla Province. Korea Times file
By Lee Kyung-min
By Lee Kyung-min
Korea Electric Power Corp. (KEPCO) apologized for failing to supervise its employees who have sought profit using confidential information as well as unscrupulous spending at the Korea Institute of Energy Technology (Kentech), a much-criticized technology university associated with the state-run energy firm, according to market watchers, Friday.
“We take recent media reports very seriously and are prepared to seek measures to fortify our financials,” KEPCO said in a statement.
The apology fails to ease public fury over a slew of employee corruption and mismanagement cases made public over the past few months. In March, the energy ministry audit found that high-ranking KEPCO officials had used corporate credit cards for personal spending and organized overseas trips unrelated to their work. The Board of Audit and Inspection (BAI) said KEPCO misappropriated or otherwise unscrupulously spent 2.5 trillion won ($1.8 billion) between 2017 and 2021.
Further propelling the criticism is the state-run energy firm maneuvering to pass its rocketing losses on to the public in the form of higher rates in gas and electricity. The losses were amplified by a worldwide energy crisis sparked by Russia's invasion of Ukraine, but taxpayers balk at the rate hike moves which prioritize the long-vested interests of public servants.
The future of Kentech, a technology university in Naju, South Jeolla Province, remains uncertain. The establishment of the university has yet to dispel criticism that it is an ill-conceived and ill-prepared university, built solely because it was a campaign pledge of former President Moon Jae-in.
KEPCO suffered 32 trillion won in operating losses last year, about a six-fold increase from the previous year's operating loss of 5.86 trillion won.
According to the BAI, some 180 KEPCO employees are under audit over setting up a corporate entity under their family's name to run a solar energy business from October last year.
Solar power can make profit only when the tradable power sources are recognized by KEPCO, a reason why market competition is fierce to secure storage capacity.
Some entities were able to plan ahead of their competitors, according to the BAI, using information provided by KEPCO officials. The audit office will review the names of the business entities in question to see whether their family members are employees of the state-run firm.