ID :
202228
Fri, 08/19/2011 - 04:16
Auther :
Shortlink :
https://oananews.org//node/202228
The shortlink copeid
Shareholders file damages suit against KEPCO chief
SEOUL, Aug. 19 (Yonhap) -- A group of shareholders of South Korea's state-run Korea Electric Power Corp. (KEPCO) has filed a lawsuit against its president, claiming KEPCO suffered losses due to his failure to adequately raise electricity prices in a timely manner, company officials said Friday.
The group, consisting of 13 small shareholders, claimed KEPCO president Kim Ssang-su's failure caused 2.8 trillion won (US$2.6 billion) in damage to the company over the past three years. They demanded Kim pay the money to the company in the suit filed with a Seoul court on Aug. 2, according to the company officials.
KEPCO, with final approval from the government, raised its electricity prices each year since 2009 with the latest price hike of an average 4.9 percent approved and announced last month by the Ministry of Knowledge Economy.
The price, however, still accounts for only about 90 percent of production costs as electricity has long been considered a public good, part of the reason KEPCO, the country's sole electricity service provider, is still run by the government.
Electricity prices accounted for only about 77.7 percent of production costs in 2008, leaving a 3.7 trillion deficit for KEPCO. The company is again expected to post a large deficit this year despite the latest price increase that came into effect at the beginning of this month.
The shareholders claimed Kim's failure to raise prices by large enough margins caused KEPCO to lose 500 billion won in 2009, 1.8 trillion won in 2010 and 500 billion won this year.
KEPCO's second-quarter net loss widened from a year earlier due mainly to lower electricity rates. Net loss came to 1.08 trillion won in the April-June period, compared with a loss of 835.6 billion won a year ago.
The group, consisting of 13 small shareholders, claimed KEPCO president Kim Ssang-su's failure caused 2.8 trillion won (US$2.6 billion) in damage to the company over the past three years. They demanded Kim pay the money to the company in the suit filed with a Seoul court on Aug. 2, according to the company officials.
KEPCO, with final approval from the government, raised its electricity prices each year since 2009 with the latest price hike of an average 4.9 percent approved and announced last month by the Ministry of Knowledge Economy.
The price, however, still accounts for only about 90 percent of production costs as electricity has long been considered a public good, part of the reason KEPCO, the country's sole electricity service provider, is still run by the government.
Electricity prices accounted for only about 77.7 percent of production costs in 2008, leaving a 3.7 trillion deficit for KEPCO. The company is again expected to post a large deficit this year despite the latest price increase that came into effect at the beginning of this month.
The shareholders claimed Kim's failure to raise prices by large enough margins caused KEPCO to lose 500 billion won in 2009, 1.8 trillion won in 2010 and 500 billion won this year.
KEPCO's second-quarter net loss widened from a year earlier due mainly to lower electricity rates. Net loss came to 1.08 trillion won in the April-June period, compared with a loss of 835.6 billion won a year ago.
