The possibility of an imminent hike in electricity fees may hit the finances of the manufacturing industry, but is also likely to add vigor to the long-stagnant solar power market.

Korea’s cheap electricity for industry has long been pointed to as an obstruction to the development of alternative energy resources.

“We have reached a consensus that the current electricity fee system needs to be adjusted, but no details have been decided yet,” said Han Jin-hyun, vice minister of the Ministry of Trade, Industry and Energy, on Wednesday.

He denied rumors and reports that the standard electricity fee would be increased by up to 6 percent within the year.

Ministry officials nevertheless admitted that this year’s electricity receipts fell short of the total production cost and that a fee hike of some degree might be plausible next year.

MOTIE Minister Yoon Sang-jick, too, earlier pledged to restructure electricity fees and prevent demand and supply imbalances in the future.

He also stressed the importance of energy-saving and management systems that could be combined with solar power generation.

“The electricity fee increase is the most favorable factor possible for the solar energy industry,” said Kyobo Securities in a report.

A 50 percent rise in electricity fees would boost the solar industry’s profit rate by 12.7 percent and a 100 percent rise by 17.9 percent, according to the report.

Korea’s current electricity fees, both for domestic and industrial use, are the lowest among OECD states, showing a clear contrast with solar power-leading states such as Germany and Japan.

Both countries have some of the highest electricity fees ― Germany 3.95 times higher and Japan 2.93 times higher than those of Korea.

Even discounting the possibility of a fee hike, industry observers predicted that the solar market had bottomed out and was likely to gain momentum gradually.

Hanwha Chemical, Korea’s leading player in the solar power sector, said that it would reach the break-even point and turn a profit next year.

Despite its vision for the future of solar energy, the company has long been caught in a business slump, recording losses of 34.2 billion won ($32.2 million) in the second quarter of this year.

“The world solar power market has so far been in a transition period and is now facing a second leap,” said an official.

“The global demand will increase by up to 10 percent within the year and the figure will grow further next year.”

By Bae Hyun-jung (tellme@heraldcorp.com)