South Korea: carbon emission quota increased

On 24 January the South Korean government increased the carbon emissions quota by 1700t to 539Mt and added 51Mt to emission rights in view of companies’ efforts for greenhouse gas reduction prior to the implementation of emissions trading.

Community energy suppliers and cement manufacturers are expected to benefit from the adjustment, with the price/t of carbon emission rights recently tripling from a year ago to KRW20,850 (US$17.75) in the Korea Exchange.

The government also voted for its second three-year plan on emission trading, to be implemented from 18-2020. According to this plan, greenhouse gas emission rights, which are currently allocated for free, are to be allocated in return for a payment equivalent to three per cent of allowance.

Those in various industries are opposed to the new rule, claiming that the payment will result in an additional burden of no less than KRW4.5tn (US$3.8bn) each year.