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Kepco likely to freeze electricity rates for Q4

Published: 22 Sep. 2025, 11:34 Updated: 22 Sep. 2025, 12:46

A pedestrian walks by an electric meter in Seoul on March 21. [YONHAP]

The state-run Korea Electric Power Corporation (Kepco) said Monday it will freeze the adjusted fuel cost for the fourth quarter, raising the possibility Korea's electricity rates will remain unchanged in the last three months of this year.

Kepco said it will keep the adjusted unit fuel cost, a key part of the country's electricity rates, unchanged at the highest threshold of 5 won ($0.004) per kilowatt-hour (kWh) for the October to December period.

The company has maintained the adjusted unit fuel cost at 5 won since the third quarter of 2022.

The fuel cost adjustment unit price is determined before each quarter within a range of plus or minus 5 won per kilowatt-hour 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 less than 12.1 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 fourth 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.

To ease the financial pressure, Kepco raised the electricity rate for industrial use by 9.7 percent in October 2024 while leaving those for households and small stores unchanged.

Despite Monday's decision, the country's electricity rate could ultimately be hiked due to other factors, such as the electricity consumption charge.

Last month, President Lee Jae Myung said electricity rates are bound to rise with the government's plan to facilitate the use of renewable energy as part of efforts to reduce carbon emissions, according to the presidential office.

Yonhap