Supply Chain Crisis... Energy Gong Faces Successive 'Nakhasan Controversy'

Korea Gas Corporation Pyeongtaek Liquefied Natural Gas (LNG) Receiving Terminal located in Pyeongtaek, Gyeonggi.
[Photo by Korea Gas Corporation]

[Asia Economy Sejong=Reporter Lee Jun-hyung] Major domestic energy public enterprises have become embroiled in a 'parachute controversy.' This is due to individuals with little connection to the relevant fields consecutively occupying key positions in energy public enterprises. Critics argue that President Yoon Seok-yeol's campaign pledge to block 'parachute appointments' during his presidential run has become meaningless.

According to related ministries on the 12th, Korea Gas Corporation plans to appoint former Liberty Korea Party lawmaker Choi Yeon-hye as president through a board meeting on the 18th and an extraordinary shareholders' meeting on the 7th of next month. If appointed, Choi's term will run from next month until December 2025.

Choi is expected to become the first female CEO since the establishment of the Gas Corporation. She is a former professor at Korea Railroad University and served as president of Korea Railroad Corporation (KORAIL) from 2013 to 2016. After serving as a member of the 20th National Assembly, she chaired the Special Committee on Nuclear Phase-out Measures and Renewable Energy in Yoon Seok-yeol’s campaign during the last presidential election.

Choi Yeon-hye, former Liberty Korea Party lawmaker, appointed as the new president of Korea Gas Corporation.
[Image source=Yonhap News]

However, there are criticisms regarding Choi’s expertise. Although she has experience as a head of a public institution, she is considered distant from the energy sector. When she first applied for the Gas Corporation president position in July, she did not make it to the final candidates because interviewers gave her low scores citing lack of expertise. Subsequently, the government decided to re-open the recruitment, stating there was no suitable candidate among the remaining applicants, and Choi was appointed president after this 'second attempt.'

The situation is similar at Korea District Heating Corporation. The corporation plans to hold a shareholders' meeting on the 18th to appoint former Saenuri Party lawmaker Jeong Yong-gi as the new president. Jeong, who served as a member of the 19th and 20th National Assembly, also worked in Yoon Seok-yeol’s campaign during the last presidential election. However, he has little experience in the energy sector.

Korea Hydro & Nuclear Power recently faced turmoil over the appointment of a new outside director. Mr. A, who has operated a pub and motel in Pohang, Gyeongbuk, was appointed as an outside director on the 1st of this month, sparking controversy over his expertise. Mr. A emphasized his experience running lodging businesses in his self-introduction during the recruitment process. After the controversy, he eventually submitted his resignation to KHNP on the 9th.

There is a growing call to appoint experts to key positions in energy public enterprises. This is because the importance of energy supply is increasing amid severe global supply chain instability. The government is even promoting an 'energy diet,' limiting heating temperatures in public institution buildings to 17 degrees Celsius and turning off lighting at cultural heritage sites to prevent an energy crisis this winter. In this context, major energy public enterprises like the Gas Corporation, responsible for domestic gas supply, are being led by non-experts.

Some view this as rendering President Yoon’s pledge meaningless. During his presidential campaign, President Yoon emphasized that he would "completely block parachute appointments in public institutions."