Korea launches committee to merge five state power generators

South Korea's environment ministry said Wednesday it launched a preparatory committee to merge the country's five state-owned power generators into a single company, starting work meant to produce a combined utility with about 53 gigawatts of generating capacity.

The Ministry of Climate, Energy and Environment said the committee, chaired by Vice Minister Lee Ho-hyun, held its first meeting at the generators' cooperation office in Gangnam District, Seoul. It has 15 members: four from government, five vice presidents of the generators and six private experts in energy, power, finance, labor, law and information technology.

The five companies — Korea South-East Power, Korea Southern Power, Korea East-West Power, Korea Western Power and Korea Midland Power — would be combined into a single 100 percent subsidiary of Korea Electric Power Corporation to be named Korea Power Generation. The government announced the plan on Sept. 4, saying it would pool dispersed capital and personnel to lead a renewable-energy transition and manage the closure of coal-fired plants.

The committee will discuss the merged company's organizational structure, staff placement, operating systems, integration procedures and overseas business before special legislation is enacted. Its first meeting covers operating rules for the committee, including how workers' views will be heard; a road map to the new company's launch on Oct. 1, 2027; and a plan to hire a post-merger integration consultant.

"What we are aiming for is not a bigger power company, but a stronger energy company that supplies electricity stably and efficiently while leading carbon neutrality and energy security," Lee said. He added that the committee would examine the issues in the integration process closely and prepare without gaps.

The ministry also plans to meet the national power industry union federations and other labor groups the same day to share the results of the committee's first meeting and discuss ways to support regular communication between labor and management.

The merged company's headquarters would be split into four divisions covering renewable energy, a just transition, safety technology and planning and management, plus three to four regional renewable-energy offices that would absorb about 600 remaining staff. No site has been chosen for the headquarters, which the ministry said cannot fit in the five existing buildings and will be decided later in connection with a second round of public institution relocations.

The special legislation would provide the legal basis for the new company, streamline merger procedures, grant exemptions from corporate combination reviews, ease tax burdens and cover the succession of rights, obligations and employment contracts. The ministry is pushing for passage during the regular parliamentary session this year.

The merger would cut the leadership of the five companies from five presidents, five auditors and 10 standing directors to one president, one auditor and four standing directors, and head office staff across the five companies would fall to about 1,800 from about 2,400.