Samsung and SK Hynix Reject KEPCO's $18.7B Power Prepayment Plan

Samsung Electronics and SK Hynix have rejected a proposal from Korea Electric Power Corp (KEPCO) that would have required the two South Korean chipmakers to make a combined prepayment of approximately 25 trillion won (about $18.7 billion) to fund power infrastructure for their planned semiconductor manufacturing clusters. The rejection leaves the state-run utility without a clear path to finance the critical grid upgrades needed for the expansion of the country's chip industry. Under the proposal, Samsung would have contributed around 20 trillion won and SK Hynix about 5 trillion won. KEPCO intended to use the advance payments to build out the power infrastructure required for new fabrication plants in the Yongin and Honam regions, which are projected to need multiple gigawatts of power capacity. The plan was designed as a workaround to avoid increasing KEPCO's already substantial debt, which stood at 210.7 trillion won as of June 2026. Both companies cited uncertainty over long-term semiconductor demand as their primary reason for declining the deal.