Prices on the rise
The price increase will provide KEPCO with an additional profit of 7 trillion won in 2023, according to Lee. The government aims to use more cheap energy such as nuclear, after increasing the share of more expensive and volatile sources such as liquefied natural gas over the past five years, exacerbating Kipco’s losses.
Li said further price hikes for the second quarter will be considered after examining the local economy and the financial condition of state-owned companies as well as global energy prices. The government will also consider increasing gas prices after keeping prices unchanged for the first three months during peak heating demand in the winter.
The rise in energy prices comes as families in South Korea grapple with rising costs of living, such as food and public transportation. Countries around the world are facing rising energy prices following Russia’s war on Ukraine.
Inflation levels are expected to remain elevated, before easing next year, as stable oil prices and higher interest rates slow economies at home and abroad, Bank of Korea Governor Ri Chang said last week -yong. KIPCO’s price hike in the first quarter will impact inflation levels by 0.15 percentage points next year, senior deputy finance minister Pang Keesun said at Friday’s briefing.
Kipco shares fell 1.4% in 2022, falling for the seventh consecutive year.
