A Fee To Rapidly Charge Electric Cars Will Cost $0.26 Per kWh Starting From Next Year Due To An Exemption Of Oil Tax


It seems that public fast charging system’s fee, which will be levied starting from next year, will cost about $0.26 (300 KRW) per kWh.

This fee is about 40 to 60% cheaper than fuel cost of cars that use gasoline or diesel if they are compared according to car’s fuel and model, mileage and others.
Ministry of Environment introduced 3 calculated proposals, which are between $0.25 (279.7 KRW) to $0.38 (431.4 KRW) per kWh, of fees for 337 public fast charging facilities in South Korea that used to be free for electric cars.

1st proposal, 2nd proposal, and 3rd proposal will cost $0.25 (279.7 KRW), $0.27 (313.1 KRW), and $0.38 (431.4 KRW) per kWh respectively. These proposals will be introduced on the 23rd at public hearing that will be held at KOEX Conference Room in Seoul.
If a slow charger at home is used on a same condition, electricity cost is about $33.34 (38,000 KRW) per month. Compared to fees for public fast charging facilities, it is within 46 to 72%.
Comparing purchasing prices of Soul Electric Car and a diesel car (gasoline), it is $2,544 (2.9 million KRW) cheaper to buy an electric car ($25,944 (29.571 million KRW)) than a diesel car ($28,482 (32.463 million KRW)) considering an amount based on 1st proposal that includes a cost to buy a car, tax, cost of gas and others after 5 years from a purchase.

Even an amount ($27,373 (31.20 million KRW)) based on 3rd proposal is $1105.76 (1.26 million KRW) cheaper, and total cost for electric cars will decrease even more as a yearly mileage increases.

Comparison of purchase and cost of maintenance to yearly mileage /Reference: Ministry of Environmen

A reason why a cost to charge electric cars is cheaper than a fuel cost is due to oil tax. Current gasoline and diesel prices are about $0.48/l without tax. These prices increase when gasoline tax ($0.76 (870 KRW)) and diesel tax ($0.55 (630 KRW)) are added. Based on a fact that electric cars drive about 5 km with 1 kWh, unit cost of fuel for electric cars is actually bigger than normal cars if oil tax is not added.
Oil tax, which is a single most tax revenue that reaches about $17.5 billion (20 trillion KRW) per year, will lose about $1.75 billion (2 trillion KRW) of tax revenue even if 10% is encroached due to an expansion of supplies of electric cars. Although its effect is insignificant at an early stage, a measure of taxation needs to be followed to fill up a shortage of oil tax if its effect is expended hereafter.

“We are going to decide on a reasonable amount of fees to vitalize supplies of electric cars by considering profitability of private charging businesses and economic profit from a user’s view according to driving of electric cars.” said Section Chief Hong Dong Gon of Ministry of Environment’s Traffic Environment Department. “We do not currently have any plans to add taxes, which are added to oil prices, onto fees to charge electric cars.

Comparison of fuel cost of diesel cars and electric cars based on rapid charging

Staff Reporter Ham, Bongkyoon | [email protected]

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