Samsung Electronics and SK Hynix Reportedly Reject 25 Trillion Won Electricity Prepayment Plan

en.Wedoany.com Reported - On September 14, it was reported that Samsung Electronics and SK Hynix have rejected an electricity prepayment plan proposed by Korea Electric Power Corporation. The plan required the two companies to prepay a combined 25 trillion won in electricity charges for the next five years, with Samsung Electronics responsible for 20 trillion won and SK Hynix for 5 trillion won. The two companies believe that, given the continued uncertainty in the medium- to long-term operating environment of the semiconductor industry, locking in such a large-scale cash outlay in advance would increase the burden on their capital management and investment plans.

Korea Electric Power Corporation confirmed on September 3 that it had proposed a large-scale electricity prepayment arrangement to major electricity users such as Samsung Electronics and SK Hynix, but at that time the participating companies, prepayment scale, interest rate, and term had not yet been finalized. Under the previous plan, the prepayment scale for the two companies was calculated based on projected electricity charges for 2027–2031. Samsung Electronics' electricity charges in 2025 were approximately 4.1 trillion won, and SK Hynix's were approximately 900 billion won, totaling about 5 trillion won per year, thus forming a prepayment scale of approximately 25 trillion won over five years.

This prepayment was originally intended mainly for the construction of core power grid infrastructure, such as the semiconductor clusters in Yongin and the Honam region. The plan proposed by Korea Electric Power Corporation included having companies pay the prepayment in installments over approximately one year, then deducting actual electricity charges monthly from the prepaid balance; the remaining funds were also discussed to be settled with interest at a certain rate or through electricity charge offsets. The relevant interest rate and specific payment structure had been under negotiation.

Korea Electric Power Corporation's push for this financing arrangement is directly related to its large-scale power grid investment and debt financing pressure. As of the end of June 2026, the company's total liabilities were approximately 210.7 trillion won. The current temporary arrangement raising Korea Electric Power Corporation's bond issuance ceiling will expire at the end of 2027, and starting in 2028, the bond issuance ceiling will be tightened again. Pre-collecting future electricity charges was originally designed as a source of power grid construction funding outside of bond financing.

Samsung Electronics and SK Hynix are respectively advancing large-scale semiconductor capacity investments, and the related wafer fabs and industrial clusters require new transmission lines, substations, and supporting power infrastructure. The South Korean government recently estimated that new semiconductor projects and AI data centers by Samsung Electronics and SK Hynix could increase the country's new electricity demand by 25–30 GW.