Announcement of Electricity and Gas Rate Increase Proposal for Q2 Postponed (Update)

The government has temporarily postponed the electricity and gas rate hikes for the second quarter of this year. It plans to make a decision after further discussions, considering the stabilization of low-income households and trends in international energy prices.

On the 31st, Lee Chang-yang, Minister of Trade, Industry and Energy, attended a ruling party-government meeting held at the National Assembly and discussed the adjustment plan for electricity and gas rates for the second quarter of this year, but announced that the rate hike proposal will be announced after a future opinion-gathering process.

Minister Lee Chang-yang of the Ministry of Trade, Industry and Energy is speaking at the ruling party-government meeting on electricity and gas prices held at the National Assembly in Yeouido, Seoul, on the 31st. Photo by Hyunmin Kim kimhyun81@

The ruling party and government stated, "We share the recognition of the inevitability of electricity and gas rate hikes due to the deterioration of the financial situation of energy public enterprises that may occur if energy rates remain below cost, threats to a stable energy supply base, and weakened incentives for energy conservation," and "We reaffirmed the principle that minimizing the burden on the public must be the top priority."

They added, "Based on the consultation results, the ruling party and government will conduct a more thorough review of the stabilization of low-income households, trends in international energy prices, the impact on the economy including inflation, the impact on the bond market, and the financial status of public enterprises, and will announce the electricity and gas rate adjustment plan as soon as possible."

The Ministry of Trade, Industry and Energy explained, "We plan to have ample opportunities for opinion gathering to deeply discuss the necessity of energy rate adjustments, ripple effects, and institutional improvement measures through meetings with related ministries, relevant public enterprises, energy experts, and consumer groups."