Electricity bills to rise an average of 4.9%

Power bills go up an average of 4.9 percent starting Monday, after two proposals earlier this year from the Korea Electric Power Corporation (Kepco) were rejected for being too steep.

The increase for households is 3.9 percent while 6 percent for industries, according to the Ministry of Knowledge Economy. Rates for agricultural use, which have stayed unchanged for 11 years, will rise by 3 percent.

Individual households that use about 300 kilowatts a month will pay 1,200 won ($1.06) more, while industries that use 59,000 kilowatt a month will pay 327,000 won more, according to the ministry.

The decision came after the Kepco board yesterday agreed to propose a 4.9 percent rate increase. The government wrote the board last month suggesting an increase of less than 5 percent.

Early last month, the Kepco board proposed a 10.7 percent rise and last April it proposed a 13.1 percent rise. Both were rejected by the Ministry of Knowledge Economy.

Kepco delivered its proposal to the ministry yesterday, which convened its electricity committee to discuss the matter.

“We think the electricity bill increase will control energy demand in the midst of a nationwide heat wave,” said Jung Seung-il, director at the Ministry of Knowledge Economy’s energy and resource division.

“The rate increase will prevent the electricity reserves from going too low from mid-August, after the vacation period is over.”

Kepco and the ministry expect the rate increase to cut 850,000 kilowatts worth of daily electricity consumption, more than the 600,000-kilowatt capacity of the idled Gori No. 1 nuclear plant, which hasn’t run since a mechanical failure in March.

Knowledge Economy Minister Hong Suk-woo said last month that he will have the power plant reactivated as early as yesterday, but residents near the Busan plant still resist the idea.

The Kepco board indicated that it might request another rate rise in the future.

By Lee Sun-min [summerlee@joongang.co.kr]