Gov't to ease progressive electricity rate
President Park Geun-hye talks with Saenuri Party Chairman Lee Jung-hyun during a luncheon with the newly elected ruling party leadership at Cheong Wa Dae, Thursday. / Joint Press Corps
By Kim Hyo-jin
The government and the ruling Saenuri Party agreed, Thursday, to ease the rate of progressive electricity billing temporarily from July to September as a move to alleviate their utility charges during the scorching summer.
They also agreed to set up a joint taskforce to devise a long-term plan, aiming to reflect the changed pattern of electricity consumption, according to party’s chief policymaker Rep. Kim Gwang-lim.
The agreement was made during a meeting between the party leadership and senior officials from the Ministry of Trade, Industry and Energy and the Ministry of Strategy and Finance to discuss how to reform the current billing system that many say exceedingly overcharges households.
Under the current six-stage progressive electricity charge system for residential use, it is 60.7 won per kilowatt-hour (kWh) for 100 kWh.
The price rises to 125.9 won if a household consumes between 100 and 200 kilowatts, and if the amount of use goes over 500 kWh, it reaches 709.5 won _ 11.7 times that of the minimum rate.
Kim said the government will expand the scope of each stage by 50 kWh in a bid to lessen the burden caused by the progressive price increases.
About 22 million households are estimated to be beneficiaries of the reduction by 19.4 percent on average.
The new plan will be retroactively applied to the fee charged in July, Kim added.
The temporary plan is estimated to cost a total of 420 billion won ($381 million) and will be financed by the state-run electricity provider Korea Electric Power Corporation (KEPCO).
The policy consultations came just three hours after President Park Geun-hye held a luncheon meeting with the newly elected Saenuri Party leadership at Cheong Wa Dae.
Participants were new Saenuri Party Chairman Rep. Lee Jung-hyun; the five members of the decision-making Supreme Council, all of whom were elected at the party’s national convention Tuesday; floor leader Rep. Chung Jin-suk; anf chief policymaker Kim.
During the meeting, Lee called on the President to fix the electric billing system, saying it was the most urgent issue as the public can ill-afford to use air-conditioners for fear of getting extremely high electricity bills for use during the scorching summer heat.
In response, Park said the government will come up with measures to adjust the controversial billing soon.
Sympathizing with the call, she said, “It’s really a shame that households are hardly able to use air-conditioners due to high electricity bills despite the abnormally high temperatures.”
But she also explained the background of the electricity billing system, saying it was inevitable because the country relies entirely on imported fuel for its energy consumption.
Amid an unusual heat wave, electricity consumption has sharply risen, adding to concerns among private consumers over what they call “electricity bill bombs.”
In the wake of public frustration, opposition parties urged the government to reorganize the cumulative electricity rate system.
The main opposition Minjoo Party of Korea set up a taskforce to push ahead with a bill while the minor opposition People’s Party vowed to change the internal rules of KEPCO to lower the rate.