EL7.AI
Macro EconomyMedium•2 November 2026•
1 min read

KEPCO Investment Plan at Risk as Rising Fuel Costs Strain Liquidity

Key Facts

1KEPCO faces risks to its 55.3 trillion won investment plan due to rising fuel costs and frozen electricity rates.
2LNG and coal costs for power generation rose 34.6% and 40% respectively in September compared to last year.

KEPCO faces risks to its 55.3 trillion won investment plan for energy infrastructure due to escalating fuel costs and frozen electricity rates. Chosun Ilbo reported that the state-run utility is struggling with a financial deficit that threatens the development of power grids essential for semiconductor and AI hubs.

LNG and coal costs for power generation rose by 34.6% and 40% respectively in September 2026 compared to the previous year, according to Chosun Ilbo. This financial strain occurs as South Korea's Manufacturing PMI declined to 51.3 on November 2, 2026, down from a previous reading of 53.9, reflecting a tightening environment for the industrial sector.

The South Korean annual Inflation Rate is scheduled for release on November 2, 2026, with forecasts maintaining a level of 2.9%. This data point will be critical in assessing the broader price pressures that influence government decisions on electricity rate adjustments and KEPCO's funding capabilities.