South Korean business group urges power market reform

June 12, 2026 - 04:14

South Korea's main business lobby has called for urgent reform of the country's electricity market, arguing that current pricing structures are outdated and ill-suited for the demands of modern technology. The group, representing major industrial conglomerates, stated that the rapid expansion of artificial intelligence data centers, renewable energy sources, and energy storage systems requires a shift to real-time pricing.

Under the existing system, electricity rates are largely fixed and do not reflect fluctuations in supply and demand. The business lobby argues that this creates inefficiencies and discourages investment in grid flexibility. As AI data centers consume massive and unpredictable amounts of power, and as solar and wind generation vary with weather, a static pricing model becomes a bottleneck. Real-time pricing would allow large consumers to adjust usage when power is scarce or expensive, and would better reward battery storage operators for discharging electricity during peak hours.

The group warned that without market reform, South Korea risks falling behind in the global race to attract energy-intensive industries. It also noted that the current system fails to provide clear price signals for investing in new generation capacity or grid upgrades. The call for reform comes as the government reviews its long-term energy plan, with officials under pressure to balance industrial competitiveness, energy security, and climate goals.