Electricity and Gas Bills to Increase by 7,400 Won for 4-Person Households Starting Tomorrow

The government has decided to raise electricity rates by 8.0 KRW per kWh (kilowatt-hour) and gas rates by 1.04 KRW per MJ (megajoule) in the second quarter of this year. Based on the monthly electricity usage of a four-person household (332 kWh), the electricity bill is expected to increase by 3,020 KRW, and the gas bill (based on 3,861 MJ usage for a four-person household) is expected to rise by 4,400 KRW. This increase will take effect starting from the 16th of this month.

On the 15th, Lee Chang-yang, Minister of Trade, Industry and Energy, announced at the government Seoul office that the electricity and gas rates for the second quarter of this year would be raised accordingly.

Minister Lee stated, "To secure the sustainability of energy supply and to normalize the management of Korea Electric Power Corporation (KEPCO) and Korea Gas Corporation, some additional adjustments to electricity and gas rates are inevitable." KEPCO recorded a cumulative operating loss of 38.5 trillion KRW over the past two years (2021?2022), followed by an operating loss of 6.2 trillion KRW in the first quarter of this year. Korea Gas Corporation's unpaid receivables increased by 3 trillion KRW in the first quarter from 8.6 trillion KRW at the end of last year.

To alleviate the burden caused by the rate increase, the government will strengthen support for energy-vulnerable groups. For basic livelihood security recipients and low-income households, the application of the rate increase will be deferred for one year up to the average usage amount. The energy voucher program will expand its target recipients from heat- and cold-sensitive groups among basic livelihood security recipients for livelihood and medical reasons to also include heat- and cold-sensitive groups among basic livelihood security recipients for housing and education reasons.

The electricity bill installment payment system, which was previously limited to residential use, will be expanded to small business owners and root companies to help spread the burden of increased bills due to rising cooling demand over a certain period. Additionally, the agricultural electricity rates will reflect the increase in thirds over three years to prevent a sudden surge in charges in a short period.

The energy cashback program, which strengthens incentives for general consumer households to save electricity, will be expanded. If a particular household achieves a higher reduction rate than other households in the same area, they will receive an incentive of 30 KRW per kWh of electricity saved.