{
  "id": 5536274,
  "title": "Europe’s LNG Stockpiling Drives South Korea Electricity Cost Surge",
  "url": "https://urgent.news/2026/09/04/europes-lng-stockpiling-drives-south-korea-electricity-cost-surge",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-09-04T10:00:21.000Z",
  "source": {
    "name": "Hellenic Shipping News",
    "slug": "hellenic-shipping-news",
    "url": "https://www.hellenicshippingnews.com/europes-lng-stockpiling-drives-south-korea-electricity-cost-surge/"
  },
  "original_language": "en",
  "account": "South Korea's electricity costs have increased significantly, with domestic natural gas prices for power generation soaring nearly 40% over the past year. This surge in gas prices directly impacts the System Marginal Price (SMP), which determines the overall electricity production cost, with the highest-cost LNG power plants driving this trend. Europe's stockpiling of LNG for the winter season is largely responsible for the instability in Korea's electricity market. The lag in shock from international price increases, which takes 2-3 months to manifest in the domestic market, has led to growing calls for proactive responses to the situation. Korea Gas Corporation reported that the September natural gas price for power generation companies rose to 24,806.69 Korean won per GJ, a 38.7% increase from the same period last year and a 9.2% rise in just one month. This price increase is attributed to a 45.8% year-on-year hike in raw material costs. The surge in gas prices has led to a 44% rise in electricity production costs, with the SMP jumping from 103.54 Korean won per kWh in January to 148.91 Korean won in August, marking a 44% increase compared to the beginning of the year. The root of the domestic gas price surge lies in Europe's supply crisis, with the JKM indicator of Northeast Asian LNG spot prices reaching $23.18 per MMBtu, more than double the pre-Middle East war level of $10.73. As Europe scrambles to secure its supplies, the Asian-LNG competition intensifies, with Europe and Asia competing for the same \"movable LNG.\" Experts warn that preemptive measures are necessary to secure supply stability and mitigate the impact of rising fuel costs on Korea's electricity rates.",
  "summary": "Domestic natural gas prices for power generation have surged nearly 40% over the past year, sharply driving up the cost of electricity production. South Korea’s power market is structured such that the LNG (liquefied natural gas) power plants, which have the highest generation cost, determine the overall System Marginal Price (SMP). The rise in gas ...",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}