[서울신문] Low oil price was good… KEPCO’s operating profit surpassed 4 trillion last year

Turned into a surplus in 3 years since 2018
Reduced fuel cost due to low oil prices
Nuclear power plant utilization rate is 4.7%p ↑ compared to the previous year
“Power demand is likely to grow by 2% this year”

KEPCO’s operating profit surpassed 4 trillion won last year, turning it into a surplus after three years. It is an analysis that the cost of fuel such as fuel decreased due to the low oil price.

KEPCO announced on the 19th that it recorded KRW 58 trillion in sales and KRW 4.4 trillion in operating profit on a consolidated basis last year. In 2018 and 2019, it posted a deficit of 200 billion won and 1.3 trillion won, and it is a turnaround after three years. During the same period, sales were tentatively aggregated to 58,569.3 billion won, down about 1% from the previous year.

As the international fuel prices fell in the aftermath of Corona 19, the fuel cost of power generation subsidiaries and electricity purchase costs for private power generation companies decreased by nearly 6 trillion won from 36 trillion won in the previous year to 30 trillion won last year. Subsidiary fuel costs decreased by 3.5 trillion won compared to the previous year due to falling fuel prices such as oil and bituminous coal prices. Electricity purchase cost increased by 2.0% from private power generation companies, but decreased by 2.5 trillion won compared to the previous year due to liquefied natural gas (LNG) and falling oil prices.

International fuel prices, such as oil prices, are usually reflected in the power market price (SMP) with a lag of 5 to 6 months. As international oil prices plunged in the first half of last year, electricity market prices naturally fell sharply. According to KEPCO, the electricity market price last year fell by 21.8 won compared to the previous year to an average of 68.9 won per ◇.

In addition, the increase in the utilization rate of nuclear power plants, which has low power generation costs, also served as a’good news’. Last year, the nuclear power plant utilization rate was 75.3%, up 4.7 percentage points from 70.6% last year. The number of preventive maintenance days for nuclear power plants has decreased, and this is the effect of starting Shin-Kori Unit 4 in August 2019. However, the coal utilization rate fell 9.6 percentage points from 70.8% last year to 61.2% last year.

Meanwhile, in the earnings conference call held on the day, KEPCO predicted that electricity demand and purchase volume forecast this year will grow 2% from the previous year and the purchase volume will be similar to the previous year due to the domestic and overseas economic recovery. KEPCO said, “We will reduce the cost of electricity supply by reorganizing electricity rates and improving management efficiency, minimizing the factors for raising electricity rates, and continuing efforts to improve profits.”

Reporter Kim Hee-ri [email protected]