"SMEs Pay 11 Trillion Won More in Electricity Bills Than Large Corporations"

Democratic Party Lawmaker Kim Kyung-man Proposes Dedicated SME Tariff Plan
"Urgent Need to Reduce Electricity Industry Infrastructure Fund Burden by 3.7%"

Source=Korea Electric Power Corporation, Reprocessed by Office of Assemblyman Kim Kyung-man.

[Asia Economy Reporter Moon Hyewon] Small and medium-sized enterprises (SMEs) struggling due to the novel coronavirus disease (COVID-19) have been found to have borne 11 trillion KRW more in electricity charges than large corporations over the past five years, adding insult to injury.

According to an analysis of data submitted by Korea Electric Power Corporation (KEPCO) on the 5th by Kim Kyung-man, a member of the National Assembly's Industry, Trade, Energy, Small and Medium Enterprises Committee from the Democratic Party, the average selling price for SMEs mainly using High Voltage A from 2016 to this year was 117.28 KRW/kWh, which is 17% (19.89 KRW/kWh) higher than the average selling price of 97.39 KRW/kWh for large corporations mainly using High Voltage B and C.

The price difference between High Voltage A and High Voltage B·C steadily increased during this period. When converted into monetary terms, KEPCO's sales revenue from SMEs (High Voltage A) over the past five years amounted to 66.8632 trillion KRW. If the large corporations' (High Voltage B·C) rates were applied, the sales revenue would have been 55.5699 trillion KRW, resulting in a difference of a staggering 11.2933 trillion KRW.

According to KEPCO's explanation, small-capacity enterprises typically have higher electricity consumption during intermediate and peak load hours compared to off-peak hours due to equipment configuration and operational adjustment constraints, and mainly use distribution lines (High Voltage A). On the other hand, large corporations have higher flexibility in equipment configuration and operational adjustments, consume more electricity during off-peak hours when purchase prices are lower, and mainly use transmission lines (High Voltage B·C).

Assemblyman Kim said, "The unfair rate system for SMEs, which are experiencing relatively greater difficulties due to COVID-19, must be corrected as soon as possible," adding, "Since over 90% of small manufacturing companies complain about the burden of electricity charges, it is necessary to actively consider improving the fairness of the current industrial electricity rate system and introducing a dedicated rate system for SMEs to reduce their burden, and to push for a reduction in the rate of the Electricity Industry Infrastructure Fund charge (currently 3.7%)."

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