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🇰🇷 South Korea /Environment & Climate

South Korea to Create Voluntary Carbon Market, Establish Trading Exchange

From Hankyoreh · (4m ago) Korean

Translated from Korean, summarized and contextualized by DistantNews.

TLDR

  • The South Korean government plans to establish a voluntary carbon market by enacting legislation and creating a trading exchange.
  • This initiative aims to encourage greenhouse gas reduction among companies, especially SMEs and startups not covered by the existing emissions trading system.
  • The plan includes establishing a legal framework for carbon credit issuance and trading, with the Korea Exchange set to launch a dedicated exchange by year-end.

South Korea is taking a significant step towards bolstering its climate action by establishing a voluntary carbon market. The government announced its intention to create a robust legal and institutional framework, including the enactment of a specific law and the establishment of a dedicated trading exchange. This move is designed to invigorate private sector efforts in greenhouse gas reduction, complementing the existing mandatory Emissions Trading System (ETS).

The voluntary carbon market will provide a platform for companies to proactively reduce their emissions and trade carbon credits. This is particularly crucial for small and medium-sized enterprises (SMEs) and startups that are not currently subject to the stringent regulations of the ETS. By creating incentives for these businesses, South Korea aims to broaden the scope of climate action and foster a more inclusive approach to environmental responsibility.

Carbon reduction should now be a new business model that enhances corporate value, not just a cost.

— Park Yun-gyuThe Minister of Economy and Finance highlighted the economic opportunities associated with climate action.

The government's plan involves setting up a transparent system for the issuance, circulation, and retirement of carbon credits, overseen by a registered institution. The Korea Exchange is slated to launch a specialized voluntary carbon market exchange by the end of this year. This exchange will standardize various types of carbon credits, enhancing trading convenience and aiming to secure international credibility through collaboration with global rating agencies.

The establishment of the 'Korean-style Voluntary Carbon Market Alliance' signifies a collaborative effort between the public and private sectors. This alliance will serve as a governance body, connecting supply and demand for carbon credits and identifying areas for institutional improvement. Minister of Economy and Finance, Park Yun-gyu, emphasized that carbon reduction should be viewed not merely as a cost but as a new business model that enhances corporate value, pledging the government's full support to position the market as an Asian carbon hub.

We will spare no institutional support to help our market leap forward as an Asian carbon hub.

— Park Yun-gyuThe Minister of Economy and Finance expressed the government's commitment to developing South Korea's carbon market.
DistantNews Editorial

Originally published by Hankyoreh in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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