Kim Sang-jo: "Measures to Prevent Additional Electricity Rate Hikes"... Korea Electric Power Corporation in a Dilemma

[Asia Economy Reporter Moon Chae-seok] Korea Electric Power Corporation (KEPCO) is feeling awkward following remarks by Kim Sang-jo, Chief of Staff for Policy at the Blue House, stating that there will be no additional increases in electricity rates.

On the 2nd, Kim attended a briefing at the National Assembly's Steering Committee and said, "We are preparing a comprehensive plan to ensure that electricity rates do not increase further." He made this statement in response to a question from Kim Do-eup, a member of the Future United Party, regarding the nuclear phase-out policy.

Kim said, "While companies' research and development (R&D) efforts and workers' efforts are sources of competitiveness, cheap industrial electricity rates are also one of the components," but added, "In the long term, the cost of nuclear power generation is by no means cheap."

He explained that through the 9th Basic Plan for Electricity Supply and Demand (Electricity Plan), "We are preparing a comprehensive plan including an energy mix to ensure that electricity rates do not rise by 2030 compared to the 8th Electricity Plan."

KEPCO responded with a sense of embarrassment. They had been preparing to reform the rate system, including a fuel cost linkage system, but the Blue House's statement that "rate increases will not be allowed" poured cold water on those plans.

Amid the ongoing discussions for the second disaster relief fund and the fourth supplementary budget due to the spread of the novel coronavirus disease (COVID-19), it has become difficult to raise the issue of rationalizing electricity rates, and Kim's remarks have added to the burden.

An energy industry official said, "It must be embarrassing for KEPCO," adding, "Since it was a statement from the Blue House chief, they are likely unable to respond officially and are just quietly suffering."

Rationalization of KEPCO's electricity rates has often been delayed due to political remarks.

A recent example is President Moon Jae-in's directive on April 8 to grant a three-month payment deferral on electricity bills for small business owners and vulnerable groups affected by COVID-19. Following President Moon's remarks, discussions on electricity rate rationalization were completely shelved.

This content was produced with the assistance of AI translation services.