South Korea to Establish Power Supervision Agency to Oversee Electricity Market

South Korea is set to establish an independent "Power Supervision Agency" to independently investigate, manage, and oversee the electricity market. The Ministry of Climate, Energy and Environment announced on June 21 that it will hold a forum with lawmakers from the Democratic Party and the Cho Kuk Innovation Party to gather opinions before pushing for revisions to the Electricity Business Act in the second half of the year.

The government's decision comes as electricity demand is projected to surge due to the growth of advanced industries like semiconductors and artificial intelligence, coupled with policies to expand renewable energy. This diversification of power sources and consumers has made it increasingly difficult to manage grid stability and market fairness under the current system, prompting the need for a specialized organization.

The number of participants in the electricity market has dramatically increased from 19 companies in 2001 to approximately 8,000 this year. Furthermore, over 180,000 facilities engage in direct power purchase agreements (PPAs) with Korea Electric Power Corporation, bypassing the market. The methods of electricity trading are also becoming more diverse.

The new Power Supervision Agency is expected to be responsible for improving and supervising power grid technology, monitoring unfair practices in the electricity market, evaluating systems, and managing electricity data. The Ministry plans to use the opinions gathered from the forum to support discussions in the National Assembly and legislative amendments.