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Populism to ruin electricity rate revision |
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| 이름 | 임서영 | 등록일 | 16.08.21 | 조회수 | 680 |
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While the ruling Saenuri Party and the Ministry of Trade, Industry and Energy (MOTIE) launched a task force to revise the controversial electricity billing system, experts are showing concern that the revision might end up a populist policy. “The progressive rating system for households has been triggering criticism that it fails to reflect the changes of the era. We will revise the irrationalities in the electricity billing system from the perspective of the general public,” the task force said in an announcement, Thursday. The country’s six-stage progressive electricity billing system for households, which charges up to 11.7 times higher rates as more energy is used, has triggered fierce complaints from consumers amid this summer’s record-breaking heat wave. Currently, those consuming less than 100 kWh of electricity each month, or in the first stage of the progressive rate system, are levied only 60.7 won per kWh, while those in the sixth stage, consuming more than 500 kWh, are charged 709.5 won per kWh. Industry watchers say that the six-stage system is likely to be reduced to three stages since the governing party and the ministry had considered adopting it back in 2013. Some opposition lawmakers also support the three-stage system. This, however, means those in the sixth stage of energy consumption will benefit most. According to a report by the National Assembly in 2012, the households in the sixth stage will be charged 44,804 won less than before with the adoption of the three-stage system, whereas the biggest consumers are charged 3.6 times more than the smallest consumers, instead of 11.7 times more. Energy Justice Actions, a local NGO, said the progressive rating system should be revised, but “it shouldn’t focus on benefiting households that consume more than 600 kWh, which takes only 0.4 percent of energy consumers.” It stressed that the government should stop taking temporary measures based on populism, pointing to the fact that Korea’s electricity cost is cheaper than the OECD average, even when taking into account the progressive rate system or purchasing power. “It isn’t right to recklessly cut the electricity rate, ignoring cost or intention of the policies,” the NGO noted, stressing that the fundamentals of the progressive rate system should be maintained. The only problem is that it doesn’t reflect the changes, such as increasing number of single person households and increasing demand for electricity following adoption of new home electronics such as the kimchi refrigerator, according to the NGO. The revision may also include charging more for those in the first and second stages of energy consumption. They have been benefiting from the progressive system as KEPCO has been charging them below the production cost. If the revision only includes rate cuts and no hikes, KEPCO’s financial health will deteriorate, analysts point out. Though the state-run electric company recorded 11 trillion won in operating profit last year, it sustained losses of trillions of won in 2008 and 2009 due to soaring international oil prices. The revision is also likely to include a rate hike for industrial use. While industries use 56 percent of electricity, they are charged only 107.4 won per 1 kWh, which is lower than the rate for households or schools. The task force will prepare the final plan for revision within this year. |
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