Shares of Korea Electric Power Corp. (Kepco) are on track for their largest decline since early 2023 following the company’s decision to freeze power charges, raising concerns about further financial strain on the utility. The state-owned electricity distributor announced it would maintain the fuel adjustment price—an element of consumer bills that fluctuates based on gas and coal import costs—through the fourth quarter ending in December. A spokesperson for Kepco indicated that other components of the power bill could still see increases during this period.
Kepco’s stock plummeted as much as 8.9%, which would mark its steepest drop since January 2023 if it closes at that level.
This decision contradicts statements made by Chief Executive Officer Kim Dong-cheol, who recently stressed the necessity of normalizing electricity rates in an interview with Bloomberg.
Kepco faced a record operating loss in 2022, largely due to its reluctance to significantly raise electricity prices amid soaring import costs for coal and gas. The utility continues to struggle to improve profitability, selling electricity below fuel costs in a bid to shield consumers from escalating living expenses.
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