South Korea Offers Electricity Rate Choices to Small Businesses

Small business owners in South Korea will soon have more control over their electricity bills. Starting next month, businesses classified under 'General Use (Type II)' will be able to choose between a time-of-use electricity rate and a flat-rate system.

This change comes in response to concerns from businesses, such as PC rooms and lodging facilities, that operate heavily during evening hours. The new time-of-use system, which lowers rates during the day and increases them in the evening, could disproportionately affect these businesses. The flat-rate option aims to mitigate this potential financial strain.

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We considered some small business owners, like those who only operate in the evening, who have difficulty shifting their power consumption hours.

For the first six months, from June to November, Korea Electric Power Corp. will calculate both rates and automatically apply the more economical option to customers' bills. After this period, customers will need to select their preferred rate. This measure is part of a broader electricity rate restructuring that began in March, intended to align costs with the increasing availability of solar power during daylight hours.

The government emphasizes that this choice is an exception for specific business types and does not undermine the overall goal of the rate reform. Approximately 290,000 customers, or 9% of General Use (Type II) customers, will be eligible for this choice. Additionally, the government is investing over 70 billion won this year in energy efficiency programs for small business owners.

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We are supporting efficiency improvements for small business owners, root industries, and farmers and fishermen through KEPCO's own financial resources, doubling subsidies for high-efficiency LEDs and expanding supply.