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Credit Risks Loom for Korean Utility Hooked on Coal, Study Says

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·         Kepco benefited from high rating despite record loss: IEEFA

·         Reliance on fossil fuels made company vulnerable to high costs

Korea Electric Power Corp., a state utility hammered by record operating losses, is facing growing credit risks as heavy dependence on fossil fuels exacerbates its woes, according to a research group. 

Locally known as Kepco, South Korea’s monopoly power distributor has insufficient cash to cover maturing debts and is at risk of default in the absence of government intervention, according to the Institute for Energy Economics and Financial Analysis. Kepco sold a record amount of won bonds this year even as it grapples with losses that are set to exceed 26 trillion won ($18 billion) for 2022.