Power rate hike inevitable

Increasing renewable energy use will push up production costs

The state-run Korea Electric Power Corp. is expected to suffer a huge deficit this year in the course of phasing out nuclear power plants and increasing renewable energy. As a result, an electricity rate hike appears to be inevitable sooner or later.

Innovative and eco-friendly energy conversion is a global trend, however, there must be a discussion over the increase of utility charges that could affect the people's lives enormously. The majority of the people will be unhappy with bigger electricity bills.

More people are ready to use renewable energy although they will pay more for electricity. A forum held recently at the National Assembly revealed that six out of 10 people were in favor of a system that will allow consumers to choose power produced from renewable sources. More than half of the people who took part in the survey also said they were willing to pay more for eco-friendly energy.

The government is planning to increase the use of renewable energy by 30 percent to 35 percent by 2040 under the country's third basic energy plan by reducing the number of coal-fired and nuclear power stations, which cost less than renewable energy. This means that it will be inevitable for electricity rates to rise.

What is important in this energy transition process is how to change the current electricity price formula in a reasonable way. Any possible change will require a social consensus. Few would fail to understand why the government should reduce the emissions of fine dust while coping with climate change effectively and ensuring a stable power supply.

There is a widespread opinion that keeping electric power rates low stands in the way of effective energy consumption, meaning that the current system does not reflect production costs properly. Thus, it is necessary to raise power rates in order to cover the generation more properly, and promote the use of renewable energy.