Tuesday, 15 May 2012
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South Korea passes Emissions Trading Legislation – May 2012
British Embassy Seoul
Emissions trading scheme to begin in 2015. Important step forward in Korea’s efforts to tackle climate change.
Korea’s National Assembly passed landmark Emissions Trading Scheme (ETS) legislation on 2 May. The scheme will start in 2015 and cover installations emitting over 25,000 tonnes of carbon which is expected to be around 500 of the country’s largest emitters. Korea becomes the third country to approve emissions trading in the Asia-Pacific, joining Australia and New Zealand.
This is a remarkable achievement for the Korean government in the face of strong industry resistance and a step forward in its efforts to tackle climate change and embed green growth before President Lee leaves office early next year. It also represents a significant success for the UK which has supported this process from its inception through a range of key activities.
The Korean Government has been full of praise for our efforts. Minister for Environment Yoo Young-sook awarded Jiseok Kim of our Climate team a Commendation for his work on ETS, a rare honour for an employee of a foreign embassy. Young Soo-gil, Chair of the Presidential Committee on Green Growth, told us that UK involvement in the debate had been particularly helpful and positive.
Local media reaction has so far been muted, with the focus being on a higher profile Bill passed the same evening. In an official statement, the Presidential Committee on Green Growth said that ETS was the most important reform amongst all its green growth policies and that Korea would now take a leadership role in the emerging international carbon market. There was little immediate public reaction from business, with those who did repeating competitiveness concerns.
In the coming weeks and months we will work with the Korean government on the details of the scheme: many key issues have still to be decided, including the emissions caps and reduction targets for each period, and the rules for using international offsets. We will urge the Korean government to learn from the EU experience. We will also explore with colleagues in the region how to use Korea’s move as a catalyst for ETS progress elsewhere: Korea’s decision could be the tipping point for ETS in Asia.
We will assess what new commercial and research opportunities may arise. The expectation of a higher carbon price is likely to boost domestic demand for low carbon technology and renewable energy, while the creation of the trading scheme opens a new market for UK consultancies with experience of the EU ETS. The news also adds impetus to the MOU signed in the margins of Clean Energy Ministerial between BIS and the Ministry of Knowledge and Economy for R&D collaboration in clean energy.
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