Korea Electric Power Corporation’s (KEPCO) cumulative deficit reached 48 trillion won. This is the ninth consecutive quarter in deficit. Due to the current situation, KEPCO raised electricity bills twice this year. Despite the increase, it failed to turn into a surplus. Although it is inevitable to raise electricity bills, the announcement was delayed even though the fourth quarter began due to political problems.
What will Yeungnam University students think about the increase in electricity bills? The Yeungnam Observer interviewed students living alone near YU about the increase in electricity bills. The student who has lived alone for more than a year said “I feel the increase in electricity bill. I thought I used the air conditioner less than last year, but the electricity bills were higher.”
Why can not KEPCO avoid the deficit? One of the reasons is that energy prices are unstable. According to the Korea Electric Power Exchange (KPX), the wholesale price of electricity rose 87% as of October 2023 compared to the previous year. It was affected by the Russia-Ukraine war and the Israeli-Palestinian crisis. These two events triggered a surge in international oil prices and a subsequent increase in Liquified Natural Gas (LNG) prices.
There are also structural problems with KEPCO. KEPCO’s surplus and deficit repeat every three to four years. If the cost of supplying electricity increases, it becomes a deficit. Then, it has a pattern of closing the deficit by raising rates. The ultimate cause lies in KEPCO’s unstable rate system.
The institutional mechanisms established to counter unpredictable electricity bills are summarized as follows. The first is ‘housing energy cashback.’ This is a system operated by KEPCO. If electricity consumption is reduced by 10% compared to the same month last year, it can be returned as cash. The second is ‘the carbon household in my house.’ This is a business that consults effective energy-saving methods based on housing types. The third is ‘the eco-money point.’ This is a form of saving energy and giving mileage. Mileage is available for cash, payment, donation, etc. In addition to saving energy, it can be built in various ways.
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