[Exclusive] Employees Leaving KEPCO... 109 Resignations This Year Alone

A Total of 198 Employees Retired or Resigned Last Year
Number of Resignations This Year Likely to Exceed Last Year's Level

The number of employees leaving Korea Electric Power Corporation (KEPCO) is increasing. The number of resignations has exceeded 100 this year alone. Due to a negative margin structure, losses are accumulating, and with the deterioration of financial conditions and even President Jeong Seung-il stepping down, it is interpreted that more employees are deciding to resign amid KEPCO's unsettled atmosphere.

According to KEPCO on the 20th, a total of 393 employees resigned from the beginning of this year until the 16th. Excluding the retirement scale due to reaching retirement age (284 people), 109 employees voluntarily left the company.

The number of resignations has been steadily increasing. The number of resignations rose from 142 in 2020 to 168 in 2021, an increase of 26. Last year, 198 employees left, 30 more than the previous year. Considering the trend of 109 resignations by mid-June this year, the number of resignations is likely to increase compared to last year.

An industry insider said, "The fact that more employees are leaving KEPCO, which is highly preferred among public enterprises, is evidence of the great disappointment among internal members," adding, "Basically, KEPCO's losses occur because the price at which it buys electricity is higher than the price at which it sells it, and dissatisfaction is growing as the responsibility is being shifted solely onto KEPCO."

KEPCO recorded an operating loss of 32.6034 trillion won last year. In the fourth quarter alone, it posted losses exceeding 10 trillion won, marking the largest operating loss ever recorded both annually and quarterly. This was because the wholesale electricity price (SMP, System Marginal Price) more than doubled due to the sharp rise in fuel prices such as liquefied natural gas (LNG) and coal, but the electricity sales price did not keep pace. In fact, KEPCO's electricity sales revenue increased by 8.9 trillion won last year, but fuel and electricity purchase costs surged by 35.5 trillion won. This situation continues this year as well. KEPCO recorded an operating loss of 6.2 trillion won in the first quarter of this year.

The government submitted to the National Assembly last year an appropriate annual electricity rate increase amount of 51.6 won per kWh, aiming to eliminate KEPCO's accumulated deficit by 2026. Although the rate should be raised by about 13 won each quarter, in reality, it was only increased by a total of 21.1 won, with 13.1 won in the first quarter and 8 won in the second quarter.

Last month, KEPCO decided to pursue financial improvements totaling more than 25 trillion won to achieve early management normalization this year. This includes not only the return of executives' salary increases but also the participation of all employees. In particular, KEPCO received a poor (D) grade for the first time in the '2022 Public Institution Management Performance Evaluation' due to the large deficit last year, resulting in no performance bonuses.

A KEPCO union official said, "In a situation where international fuel prices have skyrocketed due to the Russia-Ukraine war, KEPCO cannot generate any profit because it sells electricity below cost," adding, "We urge the immediate abolition of the public institution management evaluation, which has become a tool for forced wage cuts in this situation."