Home > National > Social Affairs

Kepco keeps electricity rate frozen for third quarter

Published: 23 Jun. 2025, 11:10 Updated: 23 Jun. 2025, 14:30

Electric meters of building in Seoul are seen on June 18. [NEWS1]

The state-run Korea Electric Power Corporation (Kepco) said Monday it will freeze electricity rates in the third quarter despite recent declines in global energy prices as part of efforts to improve its financial stability.

Kepco said it will keep the adjusted unit fuel cost, a key part of the country's electricity rates, unchanged at 5 won per kilowatt-hour (kWh) for the July-September period.

The fuel cost adjustment unit price is determined before each quarter based on energy prices, such as coal and liquefied natural gas (LNG), in the preceding three months.

Considering the recent fall in fuel prices, Kepco initially had to lower the cost to -6.4 won per kWh, but the government has told the company to keep the cost intact, highlighting the need to continue improving its financial soundness.

"We were notified by the government to maintain the current rate of 5 won per kWh in the third quarter, considering Kepco's financial situation and the significant amount of unadjusted fuel cost charges in the past," the company explained, noting it has also been asked to continue its efforts to normalize its management.

Kepco's total debt hit a record high of 205 trillion won ($149 billion) last year, according to its regulatory filing, partly due to high interest payments on existing debt.

The company's financial troubles started when it continued providing electricity at prices below production costs, even as global energy prices surged between 2021 and 2023 due to the Russia-Ukraine war.

To ease the financial pressure, Kepco raised the electricity rate for industrial use by 9.7 percent in October, while maintaining those for households and small stores unchanged.

Yonhap