S. Korea to jack up electricity rates in Q1 ’23 by biggest margin in 30 years

[Photo by Lee Chung-woo]

South Korea will raise electricity rates in the first quarter of next year by the largest ever margin in response to soaring fuel prices and mounting losses of debt-ridden Korea Electric Power Corp. (KEPCO), the Ministry of Trade, Industry and Energy said Friday.

The government and KEPCO decided to raise the power bill for consumer and industrial use by 13.1 won ($0.01) per kilowatt hour (kWh) for the January-March period next year following a 2.5 won hike in the fourth quarter of this year.

The planned bill hike is estimated to cost at least 4,022 won more for an average household of four members per month, pushing up the monthly total to the 57,000 won range.

In a report recently submitted to the National Assembly, the government called for a 51.6 won electricity rate hike per kWh next year.

The increase rate (9.5 percent) and the increased amount per kWh (13.1 won) are the highest since the 1981 energy crisis caused by a drop in oil production.

With the bill hike, KEPCO’s operating loss is narrowed to 1.3 trillion won next year.

The state-run utility company is projected to report a record operating loss of over 30 trillion won this year due to a surge in energy purchase costs.It reported a loss of 9 trillion won in 2021.

But the government decided to freeze gas rates for the first quarter next year in consideration of increased burden on people living during the winter season, the ministry said.