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Electricity and gas bills to increase from Tuesday

Posted May. 16, 2023 07:53,   

Updated May. 16, 2023 07:53


Electricity and gas bills will increase by 7,400 won per month for a family of four, as the rate hike, which was delayed for over a month due to concerns about inflation, has finally been finalized. However, it has been noted that the increased price is still below the cost, which is insufficient to address the significant deficit of the Korea Electric Power Corporation (KEPCO) and the Korea Gas Corporation (KOGAS).

On Monday, the People's Power Party and the government held a party consultation meeting at the National Assembly and agreed to further increase electricity and gas rates for the second quarter (April-June). As a result, electricity rates will rise by 8 won per kWh (146.6 won → 154.6 won), and gas rates will increase by 1.04 won per MJ (19.69 won → 20.73 won) starting from Tuesday. This represents a 5.3% increase from the previous electricity and gas rates, respectively.

The electricity bill for a family of four, consuming an average of 332 kWh per month, will increase by 3,020 won, from 63,570 won to 66,590 won per month. Likewise, a household of four, using an average of 3,861 MJ of gas per month, will experience an increase of 4,431 won, from 84,643 won to 89,074 won. The electricity price hike applies to both households and industries, while the gas price hike applies only to civilian use (residential and general use).

The government has also announced measures to support vulnerable groups affected by energy poverty, including beneficiaries of national basic livelihood and people with disabilities. For these groups, the rate hike will be suspended for one year. As for agricultural electricity bills, the increased amount can be paid over three years. Furthermore, the government is expanding the "energy cashback" program, aiming to reduce electricity consumption, by offering a discount of up to 100 won per kWh for those who reduce their electricity usage by 20 percent or more.

The government stated that the electricity price hike could help alleviate KEPCO's approximately 2.6 trillion won deficit. However, this falls significantly short of KEPCO's projected deficit of 10 trillion won for this year.