Questions/Answers

The Energy Voucher is a flagship welfare program in energy sector. It was started in 2015 to deal with the difficulties faced by vulnerable groups such as low-income groups and energy-poor groups during winter time. The death of a female student in 2005 by the candle-ignited fire at a power-interrupted cold house due to power tariff nonpayment caused a strong social ripple effect and invoked the strong voice for expansion of energy welfare system. And it led to the legislation of energy welfare system in Energy Act in 2006. But the same tragedy happened again in 10 years. The similar death of grandmother and her grandson in 2015 by the candle-ignited fire in the same situation as the one in 2005 rang an alarming bell to Korean society, awakened and ashamed by the reality that nothing had been improved during 10 years since the death of a female student in 2005. The lone deaths and awakened collective compassion prompted the introduction of Energy Voucher program in 2015. The Energy Voucher program can be said to be the outcome of Korean society’s resolve and sleepless effort to solve the vulnerability of socially underprivileged groups existing in every corner of Korean society. The program has contributed to reducing the blind spots of energy welfare and enhancing the quality of lives through strengthened support to energy-underprivileged groups. Now around 600 thousand vulnerable households are being supported annually. Starting from 2019, the program has been expanded to cover cooling during summer time in addition to existing support to heating during winter time so that every citizen can stay cool during summer and stay warm during winter. The program is included in national priority agenda of current Administration, which has confirmed its continuous strengthening of support to the energy underprivileged groups.

The Energy Voucher program is linked to Category 1: Delivering Inclusive and equitable services for all. The objective of the program is to let everyone spend warm winter by providing minimum energy service without discrimination. It intends to ensure that every citizen is not discriminated in the use of energy and gets support on living minimum quality of life and ultimately achieve energy welfare country. It supports the energy-underprivileged groups by providing energy vouchers, with which the groups can purchase electricity, city gas, district heating, heating oil, LPG and coal briquettes at their discretion.

Republic of Korea has been supporting low-income groups with social benefit system (livelihood security, health care, housing and education) based on income level under National Basic Living Security Act. The number of Basic Livelihood Security benefit recipients is 1.74 million (1,255 thousand households), accounting for around 3.4% of total population. The program is applied to the recipients who meet the income level standards and household membership characteristics at the same time. The eligible households are characterized as having socially vulnerable members such as senior citizens, young children, the disabled, pregnant women, patients with severe/rare/intractable disorders, who correspond with the target group of UN 2030 agenda. It supported about 565 thousand households in 2018 and is expected to reach more than 600 thousand households in 2019. The program is also in line with SDG 7: Ensure access to affordable, reliable, sustainable and modern energy for all since it contributes to increasing energy access for all by providing heating and cooling energy to socially vulnerable groups.

The Korea government set ‘Compassionate Living-together Energy Society’ as the basic direction of energy welfare in its 5 Visions of 1st National Energy Basic Plan (2008). National Energy Basic Plan is set every 5 years with plan duration of 20 years. The 3rd Plan (2019) includes an income-based step-by-step expansion of eligible groups and identification of unsupported socially vulnerable groups in blind spots. Korea Energy Agency, program operator continuously expanded and strengthened the program by exploring unsupported groups in blind spots. The program is sustainable since it is based on the law and national plan with reliable funding.

The program overcame the shortfall in governance through co-work among central government, local governments and energy suppliers. In Korea, energy welfare has cross-sectoral, multi-ministerial governance, with data and authorities dispersed among central and local governments, energy suppliers. So, establishing governance for providing benefits to more than 500 thousand households with leaving no one behind and without miscalculation was a big challenge. And that’s why Korea Energy Agency (KEA) came in as a nodal agency, coordinating with different stakeholders and bring in co-work among them. It has accumulated expertise in dealing with different ministries in operating green building programs, cruising between Ministry of Land and Ministry of Energy and local governments. And it has accumulated know-how on responding to questions and complaints from various multiple customers in providing subsidies, issuing certificates for renewable energy and energy efficiency. And it has experience in designing detailed programs and software system for various energy policies, indispensable components of new Energy Voucher system. KEA’s experience, expertise and know-how have contributed to the successful launch and spotless operation of Energy Voucher program. KEA got awarded as Best Practice of Innovation in Public Sector in 2018 for its excellent service for managing Energy Voucher.

Energy Voucher program provides its benefits to households of Basic Livelihood Security benefit recipients without any form of discrimination. The Korean government has been doing gender sensitivity (gender equality) evaluation on its programs every year. The program strives to achieve gender equality by reviewing the results of gender-based recipient analysis and using them as the data for improving the program. According to the analysis, the results showed gender ratio of female 56% and male 44% in 2016, female 56% and male 44% in 2017 and female 55% and male 45% in 2018.

The target groups are low-income groups who are getting Basic Livelihood Security benefit. Especially Energy Voucher program targets the recipients of Livelihood and Health Care benefits, whose incomes are lower than 40% of middle-income groups. The recipient households are required to submit the proofs of having senior citizens, young children, the disabled, pregnant women, patients with severe/rare/intractable disorders, single parents, children being heads of families in their family members. The program has been improved continuously by streamlining such as introduction of voucher card for easier, transparent and effective heating payment, exploring and expanding recipients. The number of recipient households have been continuously increased: 494 thousand (’15) → 523 thousand (’16) → 545 thousand (’17) → 565 thousand (’18). More than 600 thousand households are expected to get benefits in 2019. The improvement has been proved with the continuous increase of recipient satisfaction index: 77 points (’16) →81 points (’17) → 83 points (’18).

Energy voucher was introduced in 2015. The target groups were low-income group and cold weather-vulnerable group. The benefits were provided during winter time, supporting different amounts by 3 levels according to number of family members in the form of card-type voucher. The application period and voucher use period have been extended for the convenience of customers as follows: (Application) November-January (’15-’16) → October-January (’17-’18) → May-September (’19) (Voucher use) December-March (’15-’16) → December-April (’17) → November-May (’18) → (Summer cooling) July – September/ (Winter heating) → October – April (’19) Starting from 2019, the program is expanded to cover cooling during summer time in addition to heating during winter time. The recipients were informed of their eligibility and how to apply for the benefits at their community service centers. A call center has been operated to make appropriate response by trained consultants to questions and complaints from customers. Every year, panel review has been done to analyze the voucher use, difficulties, customer satisfaction, etc. The introduction of summer voucher in 2019 is the result of the panel review. KEA has been promoting the use of vouchers by contacting low or no-use households by phone or visit. Thanks to those proactive efforts, the application rate has been hovering at higher level (90.5%/2015, 90.9%/2016, 94.5%/2017, 93.1%/2018, 94.1%/2019) and use rate has been more than 85%. It has been making incessant effort to improve the program through constant monitoring form application to use. It is operating around 100 consultation centers for the disabled and senior citizens in collaboration with community welfare centers. And it uses wide variety of promotional and awareness channels such as mass media, training for local government officials and even operates mobile voucher stores for the recipients with limited mobility or residing in remote areas.

The smooth operation of complex system like Energy Voucher depends on the seamless coordination among related institutions such as local governments, social security workers, energy suppliers, card companies. KEA experienced difficulties and barriers in getting cooperation from numerous related institutions in the beginning. But KEA succeeded to overcome the initial rejections and difficulties through patient and continuous interactions with the institutions and has led close collaboration among them by clarifying the roles of different institutions. It has been operating the program in a stable manner for 4 years since 2015, boasting the thorough management from start to end.

Energy Voucher solves the energy issues in a vulnerable group’s perspective by supporting their energy consumption, improving their livelihood. The program has been designed for the convenience of energy-underprivileged group to select the most appropriate type of voucher according to individual circumstances. They can get charge deduction of their energy bills or pay in credit or debit card or get cash reimbursement if they have difficulties to prove their energy cost because of their residential form. Energy Voucher Plus is an innovative combined welfare and safety program, providing energy consulting and maintenance to recipients with problems in heating appliances.

The similar overseas program as Energy Voucher can be found in the US LIHEAP (Low Income Home Energy Assistance Program). LIHEAP is a program by the US HHS (Department of Health and Human Services), supporting vulnerable households with the income lower than 150% of poverty line set by federal government or lower than 60% of middle-income level set by each State. It supports both heating and cooling energy cost. The supporting scope of LIHEAP is wider and has various forms of support such as housing insulation.

Energy Voucher is a nation-wide program led by Ministry of Welfare. Recently, many local governments have benchmarked the program and introduced their own version with local budgets. Gyeonggi Province is operating its provincial program to support heating cost for low-income senior citizens and disabled households for 5 months. Ansan City is providing energy allowance to single-parent households during winter time. Cholwon County is providing heating cost to low-income groups one time annually.

Not applicable

Energy Voucher is financed by national subsidy budget, which has been increased from 51.2 billion Korean Won (approx. US$ 46.5 million) in 2017 to 61.2 billion Korean Won (approx. US$ 55.6 million) in 2018, 71.1 billion Korean Won (approx. US$ 64.6 million). 10 staff of Energy Welfare Division at KEA is in charge of management the program and designated local government officials at 17 municipalities, 224 cities/districts and 3,612 communities are engaged in and collaborating with each other for the stable operation of Energy Voucher program.

Energy Voucher has been stabilized as energy safety net for socially vulnerable groups since 2015. The program has its legal root in Energy Act and is based on national policies such as the 3rd National Energy Basic Plan, the 2nd Social Security Basic Plan and the 3rd Green Growth Basic Plan which include continuous expansion of Energy Voucher for socially vulnerable groups. The program is included in national priority agenda of current Administration, which has confirmed its continuous strengthening of support to the energy underprivileged groups. The program will settle down as a sustainable energy welfare policy.

Yes

The total number of recipients is counted through the Social Security Information System called Haengbok-E-eum. The number of recipients by local government is counted through Energy Voucher portal system. The performance is evaluated based on the government-set target. The satisfaction of recipients is inquired and analyzed through annual panel review. Every year, a sample group of around 1,000 is surveyed on energy consumption, satisfaction, etc. The performance is evaluated based on the satisfaction results of the questionnaire survey.

Indicator 1: number of recipients - Tool: Haengbok-E-eum system - Method: The goal is set by adding a certain increase rate to the total number of previous year. The current total is extracted and calculated by SSIS (Social Security Information System) at Haengbok-E-eum system. Indicator 2: satisfaction of recipients - Tool: Questionnaire survey. - Method: The goal (77.8 point in 2019) is set by adding 3-year average increase rate (3.8% in 2019) to 75 point (satisfactory level). The performance is evaluated based on the satisfaction results of the questionnaire survey to a panel of 1,000 recipients by survey institute.

The number and satisfaction of recipient households has been increasing every year as shown in below. Effort for program improvement from every angle has been made to achieve the target goal. 1. Number of recipients A. Goal(Achievement), 2016 : 52(52.4), 2017 : 53(54), 2018 : 55(56.5) 2. Satisfaction of recipients A. Goal(Achievement), 2016 : 60(77), 2017 : 65(81), 2018 : 70(83) A continuous effort has been made to strengthen awareness campaign, education, provide guide to recipients for timely application and reflect the request for program improvements. The ever-increasing number of recipients implies that an incessant effort has been made to reduce the blind spots and explore and reach out to uncovered vulnerable recipients. The performance of satisfaction is linked with whether improvement request has been reflected into the program or not and it has considerably contributed to the invigoration of the program.

Energy Voucher is managed by Ministry of Trade, Industry and Energy (MOTIE) and its implementing agency, Korea Energy Agency (KEA). An integrated collaborative voucher delivery system has been established among approx. 20,000 energy suppliers, Ministry of Health and Welfare (MOHW), Ministry of Land, Infrastructure and Transport (MOLIT) and their related institutions, approx. 3,000 local government officials and approx. 25,000 apartment management offices. The system is being operated vertically between central government and local governments and at the same time, horizontally among KEA and related institutions. The local governments inform the clients of their eligibility, guide the application and approve promptly when the eligibility has been confirmed in a bottom-up approach connecting central government and local governments. The energy suppliers, Social Security Information System (SSIS) and credit card companies are cooperating with each other, operating regular check-up meetings to ensure no one left behind. The potential recipients can check their eligibility through the system at nearby community service centers by showing their ID cards, without any need of complex documentation. For the convenience of recipients who are not familiar with using credit cards, the recipients can choose an alternative option of Energy Bill Deduction by showing their bills.

MOTIE plays the role of overlooking Energy Voucher program and KEA operates the program in consultation with MOTIE as an implementing agency of MOTIE. Local governments take the role of checking the eligibility of potential recipients, ensuring the timely application by the recipients, reviewing and approving the applications. KEA, the implementing agency of Energy Voucher chairs the regular check-up meeting among the related stakeholder institutions for smooth and seamless voucher delivery to the recipients in cooperation with energy suppliers.

Through Energy Voucher program, human rights of socially vulnerable groups for reliable energy has been improved. It is the first of its kind integrated tangible energy welfare program. The program has contributed to the establishment of sustainable energy welfare system, elevating the quality of life by ensuring the access to energy for vulnerable groups and letting citizens sustain healthy livelihood. It is a great achievement to Korean society, marking a social notch up from the tragic deaths of socially-underprivileged groups. Various social values in the Constitution can be achieved through Energy Voucher as shown in below. 1. Opportunities, Social Integration : Provide equal livelihood service to vulnerable citizens who are incapable of earning a livelihood due to a physical disability, disease, old age and pregnancy(Article 34 (3) to (5)) 2. Human Rights : Ensure the human rights to life worthy of human beings(Article 34 (1)) 3. Safety from disaster : prevent disasters and protect citizens from harm therefrom(Article 34 (6)) 4. Health, Welfare : Ensure the rights to healthy life and welfare(Article 34 (2), Article 35 (1)) 5. Environment : Support citizens to live in a healthy and pleasant environment.(Article 35 (1))