KEPCO's
Strong Presence Abroad

Utility giant signs MOUs on cooperation with Egyptian power company

Chairman & CEO Han Joon-ho of the Korea Electric Power Corp. during his visit to Egypt on March 8 as a member of President Roh Moo-hyun's entourage, signed an MOU with Mohamad M. Awad, president of the Egyptian Electricity Holding Co. The KEPCO president also signed an MOU with Mahmoud Hassan, president of New and Renewable Energy Authority.
The MOU with EEHC provides for cooperation in a number of key areas between the two countries including automation of power distribution, the power line communication, electric IT sector, new, renewable energy, and nuclear power technology and technology consultation and training in all aspects of the power generation industry.
The rate of power during the transmission stands at 4.51 percent in Korea as of last year against 13.5 percent in Egypt. The power generation capacities in Korea totaled 61.5 million kW, far ahead of those of Egypt standing at 18.2 million kW.
The significance of the MOU is that it is based on the energy cooperation agreement signed in 1985 between Korea and Egypt and is expected to form a base of realistic technology cooperation provided to EEHC by KEPCO.
The MOU signed with NERA is designed to facilitate bilateral cooperation in the area of new and renewable energy development through the exchange of information, personnel and others.
In the meantime, KEPCO signed an agreement with the Electricite du Liban to operate and maintain two power plants in Lebanon including Deir-Amar and Zahrani power plants each with 435 MW. The contract is worth $$85.5 million with a five-year duration, marking the first advancement into Lebanon by a Korean firm. The two power plants are located near Beirut, the capital of the Middle East country and the contract is renewable after the expiry of the first five-year period for two times for a year. The power plants supply 47 percent of Lebanon's total power supply.
A total of 7 bidders including Ansaldo of Italy and NTPC of India, participated in the bidding and KEPCO was selected as the priority bidder in November last year.
Following the selection, the Korean power company went through a number of tests including the ability to meet the contract terms and fees. In December, the Lebanese government finally decided to award the contract to KEPCO. The Korean power company signed the formal contract in January and took charge of operating the power plants in February.
By advancing into Lebanon for the first time for a Korean firm, the utility giant has built a bridgehead for Korean companies to make inroads into the power generation industry in the Middle East, along with occupying an advantageous position when Lebanon opens its power generation market to private capital.
Korea Electric Power Corp. won the PLMA Demand Response Grand Prize from the Peak Loan Management Alliance in Washington for excellence in demand control of power including the peak time power control system for the first time for a foreign power company outside the United States.
Joel Gilbert, chairman of PLMA, in his speech at the award ceremony held at Hyatt Regency Hotel, said KEPCO succeeded in holding down its peak power generation to 3 million kW and was able to maintain 76.2 percent of power reserve rate, the highest in the world, which is a big surprise in explaining the award to the Korean power company. Furthermore, he said, KEPCO's power demand response program has had an outstanding economic effect and the company achieved customer satisfaction through diversified power demand program.
The Korean utility giant was able to preserve 11.3 percent of power reserve rate last year to achieve stable power supply in down stream; the company maintained 76.2 percent in peak demand management rate in 2005, the highest level in the world with that of U.S. standing at 59.8 percent, 61.2 percent for Japan, 67 percent for France and 64.6 percent for Britain.
By reducing the maximum power demand to 2.97 million kW, the company saved some 827.8 billion won in power facility investment by minimizing investment in power generation, power distribution and other power facilities; By supplying high effective equipment, it saved 574,436 MWh of energy consumption, amounting to 285.4 billion won last year; By operating 15 kinds of demand management programs, the company provided the selection rights to its customers, achieving customer satisfaction. KEPCO said Korea is the country with the highest per capita energy consumption in the world and spent $66.7 billion in importing energy imports last year.
KEPCO went all-out to save energy consumption in the country when President Han Joon-ho, an energy expert, was installed in 2004. He declared that his inaugural year was the starting year for energy expense saving and pushed the policy
on national dimension. Accordingly, KEPCO set up its energy demand strengthening measure and unleashed the activity to enforce the program in a grand scale.
Demand-side Management is a program to save energy consumption by changing patterns of energy consumption aimed at standardizing energy use by controlling demand and rational use of energy by power companies.
The Peak Load Management Alliance was set up in 1999 as a professional organization for saving electricity by managing the demand headquartered in Texas, in the United States. Its members include large U.S. power companies including Southern California Edison and related electricity organizations such as the Edison Electricity Institute, and the Electric Power Research Institute. Altogether 13 countries participate in its research on energy saving issues, playing a central role in power demand management.
PLMA presents awards to the power company with well-run peak demand management program, realizing a high economic effect recognized as the highest authority in energy demand management. The awards are given in five sectors of the power business including investor owned utility company, municipal power company, independent power supply operator, government organizations, and consumers.
In 1994, KEPCO made its debut in the global power generation sector by undertaking the Malaya project aimed at raising its capacity from 490,000 kW to 650,000 kW. The thermal power plant, under operation by KEPCO, has shown a better performance to date following the project.
KEPCO officials said if and when its investments go as planned its power generation capacity in the Philippines will increase from the current 1.85 million kW to 2.85 million kW between 2008 and 2009. Its market share in the Southeast Asian country will likely rise from 12.3 percent to 18.9 percent , trailing Myrant which has a 20 percent share as the largest foreign-owned independent power producer.
KEPCO launched the construction of a 200-megawatt coal-fired power plant in the Philippine region of Cebu. The project is the third that the company is undertaking in the southeast Asian country, following 650-megawatt Malaya and 1,200-megawatt Illijan power plant projects.
A groundbreaking ceremony for the planned base load power plant in Cebu was held in Cebu on Dec. 16 with 600 Korean and Philippine people, including KEPCO Chairman-CEO Han Joon-ho, Minister of Commerce, Industry and Energy Lee Hee-bum, Philippine Energy Minister Raphael P.M. Lotilla, participating.
The 200-magawatt (200 megawatt x 2 units) circulating fluidized bed combustion power plant is to be completed by the first half of 2009 at a cost of about $330 million. KEPCO Cebu Corp., a joint venture with Singaporean-owned Salcon Power Corp. The proposed plant will source coal from the Philippines or from Indonesia. Electricity from the plant will be sold to local distribution firms, large-scale clients and power trade exchange WESM. nw

KEPCO Chairman-CEO Han Joon-ho, left, signs an MOU with President Mohamad M. Awad of Egyptian Electricity Holding Co. in Cairo March 8.

Chairman & CEO Han Joon-ho of the Korea Electric Power Corp.