Power Demand Hits Record 95.3GW: Smart Grid Stocks Surge and Progressive Tax Reform Controversy
As prolonged heatwaves push power demand to a record 95.3GW, power equipment and smart grid stocks are rallying on supercycle expectations, while controversy over household progressive electricity billing grows.
Power Demand Hits Record 95.3GW Amid Unprecedented Heatwave... Blackout Concerns Rise
With a record-breaking heatwave sweeping the nation, power demand has surpassed 95.3GW for the first time in history. The surge in air conditioning usage, coupled with increasing industrial power demand from the recent expansion of AI data centers, has put emergency power supply reserves on high alert. According to the Korea Power Exchange, high electricity consumption is expected to continue until mid-August due to ongoing tropical nights and heatwave warnings.
Smart Grid and Power Equipment Stocks Enter 'Supercycle'
As power demand skyrockets, power equipment stocks and smart grid companies are showing strong daily gains in the stock market. This is because structural growth factors, such as the replacement of aging power grids and the expansion of AI infrastructure, have been highlighted beyond just a simple summer seasonal theme.
- Key Beneficiaries: Large power equipment manufacturers like LS ELECTRIC, HD Hyundai Electric, and Hyosung Heavy Industries.
- Smart Grid & AMI: Intelligent power grid infrastructure companies like Omni System, NuriFlex, and Iljin Electric.
- Market Outlook: Analysts predict a long-term upward rally as global power infrastructure investments drive order backlogs for these companies to all-time highs.
Concerns Spread Over 'Progressive Tax Bomb' on Household Electric Bills
Behind the surge in power demand lies the concern of a progressive tax bomb on household electric bills. As air conditioner usage times increase significantly, voices urging the easing or reform of the progressive billing system are growing louder, particularly in economic communities. Frustrations are exploding over the current billing system, which places an excessive burden on household electricity rates compared to industrial use, drawing attention to whether the government will take temporary measures to ease the progressive system.
Frequently Asked Questions (FAQ)
Q. Will power equipment stocks decline after summer?
While they were considered short-term summer themes in the past, they are currently being re-evaluated as structural long-term beneficiaries due to the explosive power demand from AI data centers and the global cycle of replacing aging power grids.
Q. Is there a possibility of easing the progressive electricity billing system?
With mounting public pressure, the government and KEPCO are carefully considering the option of easing the progressive system during the summer. However, due to KEPCO's massive accumulated deficit, targeted support for vulnerable groups is more likely than a comprehensive reform.
Q. Why is the smart grid important?
The smart grid, which maximizes energy efficiency by tracking power supply and demand in real-time, is a core infrastructure that prevents blackouts and enables efficient distribution within limited power production capacities.