President Lee Jae-myung said at the National Fiscal Strategy Meeting on the 13th that it is a situation where we need to adjust residential electricity rates, which are relatively cheap compared with industrial rates. He raised the possibility of increasing residential electricity rates.
The president's remarks came during the discussion in the latter part of the meeting. Lee Sang-min, senior research fellow at the People's Fiscal Research Institute, said in relation to the need for large amounts of power for the three mega projects that the price should be cheap for times or regions where electricity is in surplus.
In response, the president asked Minister Kim Seong-hwan of the Ministry of Climate, Energy and Environment, Doesn't the ministry plan a flexible pricing system that makes rates cheaper when power is in surplus and more expensive during peak times?
Minister Kim said, We have introduced it only for industrial electricity rates for now. The president then said, It should ultimately be expanded to residential use as well. Minister Kim said, We should start with Jeju Island and expand it nationwide.
Afterward, the president asked, It is hard to bring this up because of price controls right now, but what is the average level of electricity rates? Minister Kim said, The global trend is usually cheaper industrial rates and more expensive residential rates, but in Korea, corporations are paying much higher electricity rates.
The president said, If there is no issue with inflation burdens or income, it is a situation where residential electricity rates should be adjusted. He added, If we raise residential rates a bit, it would be good to support low-income households in the form of vouchers.
There is already a voucher program supporting electricity bills for low-income households, and the related budget is reportedly 800 billion won. When Minister Kim reported this, the president said, That is too small, and added, Let's hold a policy discussion later.