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| Choo Kyung-ho, center, deputy prime minister and minister of economy and finance, speaks during an emergency economic ministers' meeting at the Government Complex Seoul in central Seoul, Friday. Yonhap |
State-run institutions obliged to cut energy use by 10% from Oct. 1
By Baek Byung-yeul
The government raised electricity and gas prices at the start of this month, as the prices of raw materials such as natural gas and bituminous coal are skyrocketing worldwide due to the ongoing war between Russia and Ukraine, and the chances that Russia could withhold its natural gas supply are increasing, it said Friday.
Choo Kyung-ho, the deputy prime minister and minister of economy and finance, hosted an emergency economic ministers' meeting last Friday at the Government Complex Seoul with Lee Chang-yang, the minister of trade, industry and energy, and other government officials, during which he revealed that they have decided to raise electricity and gas prices for the fourth quarter from October to December.
According to the government's decision, the gas prices for household and commercial use was increased by 2.7 won ($0.0019) per megajoule, up 15.9 percent for households and 16.4 percent for commercial use such as for restaurants and lodging businesses.
State-run Korea Electric Power Corp. (KEPCO) said it additionally raised the price of electricity by 2.5 won per kilowatt-hour (kWh) in addition to the already-decided increase of 4.9 won per kWh. Thus, the rates were increased by a total of 7.4 won per kWh on Oct. 1.
Due to the price hikes, a household in Seoul will need to pay 5,400 won more on average for monthly gas use. KEPCO also predicted that the monthly electricity bill will increase by 2,270 won for a family of four that uses an average of 307 kWh of electricity per month.
The deputy prime minister said that every government institution will begin implementing an operation to reduce energy consumption by 10 percent starting in October. Various energy-saving efforts such as limiting heating temperatures and turning off outdoor lighting will be implemented, and each institution's efforts will be reflected in management evaluations.
"Considering the fact that energy demand increases in winter and the possibility of Russia limiting its natural gas supply, the energy crisis could continue for a considerable period of time," Choo said. "We have come up with energy-saving measures to overcome the global energy emergency. The government will start saving energy with extraordinary determination."
In response to the energy bill hike, business groups expressed concerns that the price hike will impede their operations.
"We recognize that the government's decision to increase electricity bills is an inevitable choice in a bid to address the unprecedented global energy price rise and the large deficit of KEPCO," the Federation of Korean Industries (FKI), one of the largest business lobby groups here, said in a statement.
"We are concerned that the energy price hike could accelerate the contraction of our companies' management activities, which are already hit by high prices, high exchange rates and high interest rates."
Cho Young-jun, executive director of sustainable management institution at the Korea Chamber of Commerce and Industry (KCCI), also expressed his worry. "It is true that raising electricity bills is very burdensome for companies at a time when they are facing difficult business circumstances," he said in a statement.
"The energy crisis cannot be solved by the government or companies alone. We need to actively participate in our daily lives, such as by maintaining proper indoor temperatures in winter, using high-efficiency home appliances and public transportation."
