The government will reduce electricity rates for the Yeongnam and Honam regions by up to 10% through a reform of industrial electricity pricing. The country will be divided into four metropolitan areas, with larger rate reductions applied to regions farther from the capital area. It is expected that this will attract corporate investment to local areas with lower electricity rates and yield an annual reduction in industrial electricity costs of approximately 2.8 trillion won.
The Ministry of Climate, Energy and Environment and KEPCO held a public hearing on the 26th and unveiled the design plan for the 'Industrial Regional Electricity Pricing System' (hereinafter referred to as the regional pricing system). Previously, uniform electricity rates were applied across all regions, but the government decided to introduce the regional pricing system reflecting transmission costs and market prices by region. The regional pricing system will apply only to industrial users.
By region, the country will be classified into four metropolitan areas reflecting the power grid structure and four zones considering balanced growth, which are then combined to create a total of 11 designated regions. The four metropolitan areas are: △Northern Capital Area (Seoul Gangbuk, Incheon, Northern Gyeonggi) △Southern Capital Area (Seoul Gangnam, Southern Gyeonggi) △Central Region (Chungbuk, Chungnam, Gangwon) △Southern Region (Gyeongbuk, Gyeongnam, Jeonbuk, Jeonnam).
The rate reduction per kwh (kilowatt-hour), reflecting regional adjustment fees by metropolitan area, is as follows: △Northern Capital Area 6–10 won △Southern Capital Area 0–1 won △Central Region 10–15 won △Southern Region 13–18 won. The largest rate reduction is expected in the Southern Region, where renewable energy and nuclear power plants are concentrated. Considering that the average sales price of industrial electricity last year was 181.9 won per kwh, a rate reduction of up to 10% is anticipated.
Kim Sung-hwan Gi Hu-bu (Minister) stated, "This will encourage investment in non-capital areas by energy-intensive industries, alleviate the national burden of building transmission networks, and further serve as an opportunity for balanced national development and enhancing the long-term competitiveness of our industry."
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