▲ An electricity bill notice
Electricity rates for the fourth quarter of this year, which will be applied starting next month, will be frozen at the current level.
Korea Electric Power Corporation (KEPCO) announced today (September 21) that it will maintain the fuel cost adjustment rate for the fourth quarter at 5 won per kilowatt-hour (kWh), the same as the current level.
Electricity bills consist of the basic charge, electricity usage charge, climate and environment charge, and fuel cost adjustment charge.
Among these, the fuel cost adjustment rate serves as the basis for the fuel cost adjustment charge, which reflects short-term energy price fluctuations.
The fuel cost adjustment rate is determined within a range of ±5 won per kWh by comprehensively considering fuel price trends, such as bituminous coal and liquefied natural gas (LNG), over the past three months.
Currently, the maximum limit of +5 won is being applied.
KEPCO has applied +5 won for 18 consecutive quarters starting from the third quarter of 2022.
KEPCO calculated that reflecting recent fuel price trends would require a fuel cost adjustment rate of +7.3 won per kWh for the fourth quarter.
The actual fuel cost for the fourth quarter, calculated using the average trade statistics prices for bituminous coal, LNG, and Bunker C oil, came to 549.64 won per kilogram, which was higher than the base fuel cost of 494.63 won per kilogram applied after deductions.
Accordingly, the variable fuel cost was calculated at 55.01 won per kilogram.
However, the actual fuel cost adjustment rate was determined to be +5 won in accordance with the upper limit.
Since the fuel cost adjustment charge remains unchanged and there are no separate increases for the basic charge, electricity usage charge, and climate and environment charge for now, electricity rates for the fourth quarter are frozen.
The inability to fully reflect rising fuel costs could pose a burden on KEPCO's finances.
KEPCO accumulated massive deficits as electricity rate increases were restricted despite soaring fuel costs during the Russia-Ukraine war.
As of the first half of this year, KEPCO's consolidated liabilities, including its power-generating subsidiaries, stood at 210.7 trillion won.
(Photo: Yonhap News TV, Yonhap News)
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