Mega Power Generation Public Enterprise Korea Power Corp. to Launch on October 1 Next Year... "Integrated Headquarters to Be Housed in New Building"

"Considering Construction of a New Building to Accommodate 1,800 Employees"

Establishing Legal Grounds Through Special Legislation; Streamlined Permitting Process

Preparations Accelerate with Formation of Integration Preparatory Committee and Working Group

Overview of Boryeong Thermal Power Plant

Five power generation public enterprises—Korea South-East Power, Korea Midland Power, Korea Western Power, Korea Southern Power, and Korea East-West Power—will be merged into Korea Power Corp., which will officially launch in October 2027. The location of the integrated headquarters, which has drawn significant attention, has not yet been determined. The government stated, "A new headquarters building is required to accommodate the integrated company headquarters."

On September 4, the Ministry of Climate, Energy and Environment held a discussion session on the integration plan for power generation public enterprises at Korea Electric Power’s South Seoul Headquarters, and announced its plan to consolidate the five power generation companies into a single entity, establishing Korea Power Corp. as a wholly owned subsidiary of Korea Electric Power Corp. The ministry also laid out follow-up measures. The day before, the government had unveiled its restructuring plan for public institutions, targeting the reduction of 109 public enterprises and declaring the intention to merge the five power generation companies into a single entity.

The location of the integrated headquarters is the main focus of public attention regarding the merger, but no specific details were released on this matter on this day.

The Ministry explained, "The five current headquarters in Jinju, Boryeong, Taean, Busan, and Ulsan are designed to accommodate approximately 500 employees each; however, there is a spatial limitation to accommodating the 1,800 employees expected in the integrated headquarters at a single location. If the organization is physically dispersed, the expected synergies in unified decision making and interdepartmental collaboration from the integration process may be limited. Thus, the need for establishing a new headquarters building for the integrated entity has been identified."

Regarding the location of the integrated headquarters, the ministry said, "A final decision will be made after comprehensive consideration of the current locations of the power generation public enterprises, the impact of a just transition, the quality of residential and working conditions, and linkage with the second phase of the relocation plan for public institutions."

To expedite the merger, the government will push for the enactment of special legislation.

The special act will include the legal basis for the establishment of Korea Power Corp., provisions for development- and permitting-related matters, the succession of the rights, obligations, and employment contracts of the existing entities, streamlined merger procedures, and measures for tax relief. The government is also reviewing the exemption from corporate merger reviews to ensure a swift and smooth integration. The aim is to enact the special act within this year's regular National Assembly session.

In September, the government will form the Power Generation Public Enterprises Integration Preparatory Committee, headed by the second vice minister of the Ministry of Climate, Energy and Environment, to initiate detailed preparations for the merger. In addition, a working-level support team consisting of representatives from the five power generation companies, Korea Electric Power Corp., and specialists in each field will be established.

The Integration Preparatory Committee will discuss and decide on major topics including the organizational structure, personnel allocation, operating systems, integration procedures, and overseas operations of the new company. The working-level support team will review relevant materials and execute detailed integration tasks by field as needed. To ensure expertise in accounting, law, tax, and IT matters, the five companies will commission a Post-Merger Integration (PMI) consulting project.

After the special act is enacted, a legally mandated Integration Steering Committee will succeed the Integration Preparatory Committee and officially lead the merger procedures. According to the ministry, "Following about one year of thorough preparation, the goal is to complete incorporation registration of the integrated entity and appoint executive management in September 2027, and officially launch Korea Power Corp. on October 1, 2027."

The newly established Korea Power Corp. will not only set up an integrated headquarters, but also establish three to four Regional Renewable Energy Headquarters. The integrated headquarters will consist of four main divisions, each headed by a standing executive director: Renewable Energy Division, Just Transition Division, Safety Technology Division, and Planning & Management Division.

Accordingly, the current structure—five CEOs, five auditors, and ten standing executive directors—will be streamlined to one CEO, one auditor, and four standing executive directors. The total number of headquarters staff across the five companies will be reduced from around 2,400 to 1,800. The ministry stated, "With a unified decision-making structure and dedicated divisions in each field, we plan to implement large-scale renewable energy projects such as offshore wind and advance a just transition more quickly and systematically."

Of the current 2,400 headquarters employees, roughly 600 remaining staff will be placed in the new three to four Regional Renewable Energy Headquarters, which will serve as key organizations responsible for regional renewable energy projects such as solar and onshore wind power.

Existing regional thermal power headquarters will retain their current system to ensure stable plant operation and on-site safety. The government noted, "Going forward, as coal-fired power plants are decommissioned or converted, workforce redeployment will be pursued in line with a just transition, and additional Regional Renewable Energy Headquarters may be established if necessary."

Meanwhile, the five existing power generation companies together currently possess about 53 GW of generation capacity, so upon integration, the entity will be reborn as a "global top 10" large-scale power company. The ministry emphasized, "The integrated company will not merely bring together the five existing companies but will also consolidate dispersed capital and manpower to take the lead in expanding renewables and implement a systematic just transition during the phase-out of coal generation."

The government expects that consolidating the previously fragmented organizations and functions of the five entities, as well as centralizing fuel procurement and investment in generation facilities, will lead to cost reductions. The ministry added, "By developing renewables and energy storage systems (ESS) on a large, integrated scale and leveraging economies of scale, economic efficiency can be improved, ultimately helping to mitigate future electricity rate increases for the next generation."

This content was produced with the assistance of AI translation services.