Electricity and Gas Prices Frozen for Now… Government and Ruling Party "Decision After Public Opinion Gathering"

Park Dae-chul "Painful Restructuring of KEPCO and Others Must Precede"

The government and the ruling party agreed on the 31st to temporarily postpone the increase in electricity and gas rates. Although they acknowledged the inevitability due to the worsening financial situation of energy public enterprises, they considered that restructuring must precede and that the burden on the public would increase.

On the same day, the ruling party and government held a meeting on electricity and gas rates at the National Assembly and announced this conclusion.

Park Dae-chul, Chairman of the Policy Committee of the People Power Party, is speaking at the party-government consultation meeting on electricity and gas rates held at the National Assembly in Yeouido, Seoul on the 31st. Photo by Hyunmin Kim kimhyun81@

Park Dae-chul, the Policy Committee Chairman of the People Power Party, told reporters immediately after the meeting, "We shared the recognition that the accumulated deficit problems of Korea Electric Power Corporation (KEPCO) and Korea Gas Corporation have reached a serious level that can no longer be ignored," but added, "Regarding the timing and extent of the increase, the Ministry of Trade, Industry and Energy proposed multiple options today, and further discussion is needed."

According to the ruling party-government meeting that day, the planned increase in electricity and gas rates to be applied from the second quarter has been put on hold for the time being. The rate increase will be finally decided after further discussions. Chairman Park explained, "There was also a point made that if rates are increased, the burden on the public will inevitably increase, so KEPCO and the Gas Corporation must undergo painful restructuring first," and added, "To comprehensively assess variables such as fluctuations in international energy prices, we decided to gather more public opinion and decide later."

It appears that no decision was made yet regarding the timing or extent of the future increase. Minister Lee Chang-yang of the Ministry of Trade, Industry and Energy said to reporters after the meeting, "We did not discuss a specific unified plan regarding the timing," and added, "We discussed various alternatives regarding the extent and speed, and once the ruling party and government choose a plan, we intend to implement it around that time."

Meanwhile, attendees from the ruling party included Ryu Seong-geol, the ranking member of the National Assembly's Strategy and Finance Committee, and Han Mu-gyeong, the ranking member of the Industry, Trade, Energy, Small and Medium Enterprises Committee. From the government side, Minister Lee Chang-yang of the Ministry of Trade, Industry and Energy and First Vice Minister Bang Gi-seon of the Ministry of Economy and Finance were present.