INSIGHT 2026-09-12 · CLAIM 251ELECTRIC TIMES · KOREA POWER MARKET
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2026.09.12

Korean SMP Plunges Amid Cooler Weather, Global Fuel Price Risks Persist

Korea's System Marginal Price (SMP) and electricity demand recently saw a sharp decline due to cooler early autumn weather, while high supply capacity from summer power measures kept generators on standby.

141.10→110.16 won/kWh
Mainland System Marginal Price (SMP) weighted average
Sept 8 to Sept 9

Our take

What factors drove Korea's recent SMP drop, and how do global risks temper a sustained price decline?

The recent sharp decline in Korea's SMP to 110.16 won/kWh on September 9 was primarily a seasonal demand-side effect driven by cooler weather and ample supply from summer readiness, rather than a fundamental shift in fuel costs, as global oil and LNG prices remain elevated due to geopolitical risks.

Korea's electricity market typically experiences high demand during summer due to cooling loads, leading to higher System Marginal Prices (SMP). The Korea Power Exchange (KPX) monitors supply and demand, and the government implements measures like the Summer Power Supply Measures to ensure stable power supply during peak periods.

  • System Marginal Price (SMP) weighted average, mainland, on Sept 9: 110.16 won/kWh (2026-09-09)
  • System Marginal Price (SMP) weighted average, mainland, on Sept 8: 141.10 won/kWh (2026-09-08)
  • System Marginal Price (SMP) drop from Sept 8 to Sept 9: 30.94 won/kWh (2026-09-09)
  • System Marginal Price (SMP) percentage drop from Sept 8 to Sept 9: 21.9% (2026-09-09)
  • System Marginal Price (SMP) weighted average, mainland, on Sept 10: 116.28 won/kWh (2026-09-10)
  • System Marginal Price (SMP) weighted average, mainland, on Sept 11: 126.99 won/kWh (2026-09-11)
  • System Marginal Price (SMP) monthly average, mainland, last month: 148.39 won/kWh (2026-08-31)
  • System Marginal Price (SMP) daily weighted average on Sept 7: 150.38 won/kWh (2026-09-07)
  • Maximum power demand on Sept 8: 79,908 MW (2026-09-08)
  • Maximum power demand on Sept 9: 75,716 MW (2026-09-09)
  • Maximum power demand drop from Sept 8 to Sept 9: 4,192 MW (2026-09-09)
  • Maximum power demand percentage drop from Sept 8 to Sept 9: 5.2% (2026-09-09)
  • Maximum power demand on Sept 9 compared to previous year: 5.4% lower than 80,012 MW (2026-09-09)
  • Maximum power demand on Sept 3: 85,469 MW (2026-09-03)
  • Maximum power demand drop from Sept 3 to Sept 9: 9,753 MW (2026-09-09)
  • Maximum power demand percentage drop from Sept 3 to Sept 9: 11.4% (2026-09-09)
  • Supply capacity on Sept 8: 101,110 MW (2026-09-08)
  • Supply capacity on Sept 9: 104,204 MW (2026-09-09)
  • Supply reserve on Sept 8: 21,202 MW (2026-09-08)
  • Supply reserve on Sept 9: 28,488 MW (2026-09-09)
  • Supply reserve ratio on Sept 8: 26.5% (2026-09-08)
  • Supply reserve ratio on Sept 9: 37.6% (2026-09-09)
  • Supply reserve ratio increase from Sept 8 to Sept 9: 11.1 percentage points (2026-09-09)
  • Brent crude oil price on Sept 10: 107.63 dollars/barrel (2026-09-10)
  • Brent crude oil price increase in one day: over 6% (2026-09-10)
  • WTI crude oil price: 102.48 dollars/barrel (2026-09-10)
  • JKM LNG October futures price on Sept 2: 25.908 dollars/MMBtu (2026-09-02)
  • Germany's gas storage rate in early September: 53% (2026-09-01)

The rapid drop in temperatures significantly reduced cooling demand, causing a substantial decrease in maximum power consumption by nearly 10 GW in less than a week. Simultaneously, the Summer Power Supply Measures ensured that a high number of cost-effective generators, including nuclear and coal, were fully operational, leading to a surge in supply capacity and reserve margins. This combination of sharply falling demand and robust supply created a temporary oversupply condition, directly pushing down the SMP, but it does not reflect a stabilization of the underlying fuel costs which are still subject to global geopolitical and supply chain pressures.

What the source says
  • Korea's mainland System Marginal Price (SMP) weighted average fell to 110.16 won/kWh on September 9, a 21.9% drop from 141.10 won/kWh on September 8.
  • Maximum power demand decreased by 4,192 MW (5.2%) from 79,908 MW on September 8 to 75,716 MW on September 9.
  • Supply capacity increased from 101,110 MW on September 8 to 104,204 MW on September 9, leading to a supply reserve ratio increase from 26.5% to 37.6%.
  • The rapid decline in electricity demand was primarily driven by cooler early autumn weather, with morning low temperatures dropping to 11-20 degrees Celsius nationwide.
  • Most generators were on standby as part of the Summer Power Supply Measures, contributing to increased supply capacity and lower SMP.
  • International oil prices surged, with Brent crude reaching 107.63 dollars/barrel on September 10, due to worsening Middle East political instability and concerns over crude oil transport disruptions.
  • Northeast Asian LNG spot prices (JKM October futures) rose to 25.908 dollars/MMBtu on September 2, the highest since December 2022, driven by Middle East conflict disrupting Qatari supply and increased European demand for US LNG.
  • Korea Electric Power Corporation official A Korea Electric Power Corporation (KEPCO) official stated that while the recent SMP drop positively impacted power purchase costs, it is likely a short-term effect given the global market situation, necessitating continuous monitoring.

For investors — Investors and operators in the Korean DER market should anticipate continued volatility in power purchase costs, as the current low SMP is likely a temporary seasonal effect, with underlying global fuel price pressures poised to re-emerge.

Watch: Monitoring global oil and LNG price trends, geopolitical developments in the Middle East, and the onset of colder weather in Europe and Asia for potential impacts on fuel supply and prices.

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