SK Group merger to remedy heightened power demand due to AI development, chair says

The SK Innovation-SK E&S merger will pave the way for the company to provide a solution for the surging power demand driven by AI technology, SK Group Chairman Chey Tae-won said.

SK Group Chairman Chey Tae-won speaks during a press conference held on Friday on Jeju Island. [KOREA CHAMBER OF COMMERCE AND INDUSTRY]

The SK Innovation-SK E&S merger will pave the way for the company to provide a solution for the surging power demand driven by AI technology, SK Group Chairman Chey Tae-won said.

The SK chief also called for greater support from the government to assist with the exponential investments in chip manufacturing.

“AI consumes an immense amount of power, for which [SK Innovation and SK E&S] can provide a solution together,” said Chey during a press conference held on Friday at The Shilla Jeju hotel during the annual Jeju Forum hosted by the Korea Chamber of Commerce and Industry (KCCI). Chey currently serves as the chairman of the KCCI.

“We found significant business potential in providing a solution for supplying electricity to AI data centers,” said Chey.

The boards of SK Innovation and SK E&S recently approved a merger of the two companies, which will result in the largest private energy company in the Asia-Pacific region with an asset value of 100 trillion won ($71.9 billion).

During the press conference, Chey also urged the government to provide greater financial support, saying that “it is difficult to handle the immense cost poured into [high-bandwidth memory production] only with tax incentives.”

The chairman mentioned subsidy programs in the United States and Japan, saying that “it seems Korea has no choice but to follow suit as well.”

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]