KEPCO "Postpones Electricity Rate System Reform to Second Half of the Year"

[Asia Economy Reporter Moon Chaeseok] Korea Electric Power Corporation (KEPCO) has postponed the revision of the electricity tariff system to the second half of the year. It had announced last year that it would push for the revision in the first half of this year.

At the board meeting held on the 26th, KEPCO stated, "Reflecting the changed conditions such as the spread of the novel coronavirus disease (COVID-19) and increased volatility in oil prices, we have decided to prepare a plan to revise the electricity tariff system and obtain government approval as soon as possible in the second half of the year."

Previously, KEPCO had announced in June last year that it would prepare a plan to revise electricity rates by the first half of this year.

KEPCO had been promoting measures such as abolishing or reducing the essential usage discount, which provides up to 4,000 KRW discount per month for households using less than 200 kWh per month, and introducing a residential seasonal and time-of-use tariff system that differentiates rates by season and time.

Since the beginning of this year, discussions on the revision have lost momentum as households and industries have faced difficulties due to the COVID-19 crisis. In fact, the industrial sector is demanding a reduction in electricity rates.

Although KEPCO posted operating losses of 208 billion KRW in 2018 and 1.2765 trillion KRW in 2019, a surprise profit in the first quarter of this year thanks to the decline in international oil prices has also weakened the momentum for revising electricity rates.

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