(2nd LD) PM calls for reasonable solution to improving electricity rate system

(ATTN: UPDATES with new info in paras 9-10)

SEOUL, Aug. 16 (Yonhap) -- Prime Minister Hwang Kyo-ahn on Tuesday called for a "reasonable" solution to improving South Korea's controversial electricity rate system, which critics say excessively overcharges users.

His remarks came amid mounting concerns among households here that their electricity bills will soar as they increasingly rely on air conditioners to cope with the heat wave.

"As electricity rates for households are something closely related to people's day-to-day lives, (the government) should craft a reasonable solution to enhancing the current billing system," he said during a Cabinet meeting.

"We are at a critical point where we have to reduce how much people pay for air conditioning while ensuring the stable supply of electricity.

Last Thursday, the government and the ruling Saenuri Party agreed to cut electricity rates for private households temporarily between July and September by an average of nearly 20 percent. But opposition parties have decried the decision as a stopgap measure and demanded a fundamental solution.

As part of efforts to curtail electricity consumption, South Korea currently uses a "progressive" billing system for households. The system is not also applied to industries that account for over half of the country's energy consumption.

Under the system first introduced during the oil crisis in the 1970s, a household pays 60.7 won ($0.06) per kilowatt for the first 100 kilowatts in a month. But the price rises to 125.9 won if it consumes between 100 and 200 kilowatts.

The price even shoots up to 709.5 won per kilowatt -- nearly 12 times more than the first price -- if they consume electricity in excess of 500 kilowatts each month.

Meanwhile, the ruling Saenuri Party and the government agreed to hold an inaugural session of their task force, charged with overhauling the electricity billing system, on Thursday, party officials said.

The task force, which will convene a session once or twice a month to examine relevant issues, is comprised of 15 members, including Saenuri lawmakers that belong to the National Assembly's Trade, Industry and Energy Committee, and Strategy and Finance Committee.

Vice Minister of Trade, Industry and Energy Woo Tae-hee and Korea Electric Power Corp. Vice President Kim Si-ho will also be part of the task force.

During the Cabinet meeting, the prime minister also called on the government to be ready to counter Pyongyang's various forms of provocations, including those in the newly emerging security domain, cyberspace.

"We are now in a serious situation where North Korea's reckless nuclear and missile provocations continue, and terrorist attacks around the world frequently occur," Hwang said, calling for a robust security posture.

sshluck@yna.co.kr
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