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North Korea jacks up home electric bills

Oct 26,2018
The North Korean government has dramatically raised electricity prices for ordinary households, apparently to replenish the state coffers after UN Security Council sanctions put a chokehold on revenues, particularly from coal exports.

Several South Korean government officials who spoke with the JoongAng Ilbo on the condition of anonymity Wednesday said electricity fees were raised in November 2017 from 3 won (0.3 cents) per kilowatt hour to 30 to 50 won per kilowatt hour. One source said the North has newly implemented a progressive billing system, charging people more per unit after they use 100 kilowatts.

To encourage households to use less electricity, North Korean authorities were said to have ordered every household to install an electric meter, while forcing those who don’t have one to buy one.

“The North used to provide electricity at a really low price, so low that it was considered almost free,” the South Korean official said. That changed in November 2017, two months after the UN Security Council instituted a ban on imports of North Korean coal, the official continued. From that point on, the North stopped charging households a flat rate and started charging by the amount of electricity used.

UN Security Council Resolution 2375 was passed in September 2017 and the North Korean government had to find ways to keep its coal industry going. It started buying coal through the state budget, but because the coffers were running low, eventually came to the conclusion it would raise electricity fees and collect more taxes.

In the backdrop of that decision, said a second local government official, was the fact that North Korean coal miners were turning to a more lucrative business, gold-mining, and that also threatened coal output.

“The North sees coal mining as its lifeline,” said the second source. “If that industry grinds to a halt, it would affect electricity production at thermoelectric power plants, which would then affect factories.”

Chin Hee-gwan, a professor of unification studies at Inje University in Gimhae, South Gyeongsang, said North Korean authorities were aware people had cash stashed away when it decided to charge more for electricity.


BY JEONG YONG-SOO [lee.sungeun@joongang.co.kr]