1,176,000 Households to Receive 300,000 Won Energy Vouchers... Gas Bill Discounts Doubled

Announcement of Expanded Heating Cost Support Measures for Winter Vulnerable Groups
Ruling Party and Government Likely to Discuss Additional Measures for Heating Cost Surge Next Week

[Asia Economy Reporters Baek Kyunghwan, Lee Hyunju, Sejong=Reporter Lee Dongwoo] In response to the 'heating bill bomb' crisis triggered by the gas price hike, the government has announced a plan to significantly expand heating cost support for vulnerable groups. The energy voucher support amount for vulnerable groups will be doubled, and the gas price discount by Korea Gas Corporation will also be doubled.

Choi Sangmok, Senior Secretary for Economic Affairs at the Presidential Office, announced this support measure during a briefing at the Yongsan Presidential Office on the morning of the 26th, stating, "To expand heating cost support for vulnerable groups during winter, we have decided to significantly increase energy voucher support and gas price discounts."

[Image source=Yonhap News]

First, to expand support for vulnerable groups, the energy voucher support amount will be increased from 152,000 won to 304,000 won, doubling the previous amount. The target includes 1,176,000 households among livelihood, medical, housing, education benefit recipients, and basic livelihood security households, including elderly patients and other heat- and cold-sensitive groups. The social consideration beneficiaries of Korea Gas Corporation total 1.6 million households. The discount on gas fees they receive this year will be adjusted from the previous 9,000 won to 36,000 won range to 18,000 won to 72,000 won.

Although the government increased the energy voucher support amount by 51% and the city gas discount for social consideration beneficiaries by 50% at the end of last year, the recent continuous cold wave has increased heating demand, raising the heating cost burden on vulnerable groups, prompting these measures. Senior Secretary Choi pointed to the sharp rise in international energy prices as the cause of the heating cost increase. He explained, "There have been upward factors over the past few years, but price increases were suppressed," adding, "This is due to the international natural gas price soaring more than tenfold compared to the first quarter of 2021." Considering the concentration of heating demand in winter, the government decided to freeze gas prices in the first quarter of this year.

Next Week’s Ruling Party-Government Meeting to Further Discuss Measures Against Heating Cost Surge

Earlier, the People Power Party requested the government to increase the energy voucher unit price paid to vulnerable groups from 150,000 won to up to double to alleviate the heating cost burden. Joo Ho-young, floor leader of the People Power Party, said at an emergency committee meeting held at the National Assembly that "The government should not stand idle while people's livelihoods are suffering due to the heating cost burden," adding, "Although an immediate supplementary budget is difficult, I hope the government will use contingency funds or other available resources to raise the energy voucher unit price to about 300,000 won to reduce the burden on ordinary people."

The People Power Party is expected to hold a ruling party-government meeting next week to discuss additional measures to ease heating cost burdens on ordinary citizens. In an interview with CBS Radio's 'Kim Hyun-jung's News Show' on the morning of the same day, Floor Leader Joo said regarding nationwide heating cost support in the form of disaster relief payments, "Nothing has been decided yet," adding, "It is natural to support vulnerable groups first, but which method is most effective and how to best use limited resources will be decided after consulting with the ruling party-government meeting and experts." Senior Secretary Choi also said, "Although energy price normalization due to external conditions is inevitable, we will make policy efforts to minimize the burden on the people," and regarding support for self-employed and small businesses, he mentioned, "We will review additional support targets after examining various factors."

This winter, households receiving the 'heating bill bomb' notices complained of management fees rising on average 2 to 3 times. As the average price of liquefied natural gas (LNG) last year rose 128% to $34.24 per MMBtu (million British thermal units) compared to $15.04 in 2021, the government raised residential gas prices by 5.47 won (38.4%) per megajoule (MJ).