Set up an independent committee

Utility charges will shoot up after the presidential election is over in March. The government announced hikes in electricity and gas bills from the second quarter just a week after pledging to freeze utility fees in the first quarter to contain inflation. The government explains the increase has been put off to ease the burden on the public, but most can smell a political motive from the move.

Yoon Suk-yeol, presidential candidate of the main opposition People Power Party (PPP), criticized the government and ruling Democratic Party (DP) on social media for being “bad” with outright exploitation of public authority to influence the election.

The electricity bill will be raised for the first time since November 2013. It will be burdensome for any government to increase electricity charges as the move affects all citizens. The freeze has devastated Korea Electric Power (Kepco). The state utility firm’s consolidated operating loss has hit 1.58 trillion won ($1.3 billion) as of September because it was unable to lift the rates despite a spike in fuel import prices and phase-out of nuclear reactors. Kepco stock price tumbled 53 percent under the Moon Jae-in administration. The government in January decided to determine rates depending on fuel prices to raise the predictability and transparency in energy charges. But it barred Kepco from raising fees despite a surge in international prices in fear of stoking a public protest. A policy cannot earn public confidence if it is influenced by political motivation.

The decision-making process must change to fend off political influence. Most advanced countries employ an independent agency in deciding energy policies. U.S. energy decisions fall under the Federal Energy Regulatory Commission and the Public Utility Commission. Germany’s Bundesnetzagentur (Federal Network Agency) for Electricity, Gas, Telecommunications, Post, and Railway, and France’s Energy Regulatory Commission are all independent bodies. The chair is appointed by the president and the members are formed through the approval and recommendation of the parliament. Their independence, neutrality, and terms are guaranteed by law.

Korea also has the energy commission under the Ministry of Trade, Industry, and Energy. The chair and deputy are appointed by the president. But it merely serves as an advisory body. To prevent political wrangling over energy rates and policy cost, an independent body should be established.