KOREA ETS

The Korea Emission Trading Scheme (K-ETS) began in January 2015 making Korea the second nation in Asia to introduce a nationwide cap-and-trade program. Through the scheme, the government aims to reduce greenhouse gas emissions by 37% below the BAU levels by 2030. Korea’s overall GHG emissions in 2013 stand at 694.5 MtCO2e excluding LULUCF with the highest emissions coming from the energy and industry sectors.

Overview

TRADING PERIOD Phase 1 (2015 – 2017), Phase 2 (2018 – 2020), Phase 3 (2021 – 2025)
CAP AND TRAJECTORY 1,703Mt
(incl. 89Mt Market Stabilization Measures, Early Action and New Entrants)
2015: 541MtCO2e, 2016: 558MtCO2e, 2017: 567MtCO2e
GHG COVERED CO2, CH4, N2O, HFCs, PFCs, SF6
SECTORS Energy, Industrial Processes and Product Use,
Building, Waste, Transport (Aviation)
THRESHOLD Companies >125,000 tCO2/yr or Installations >25,000 tCO2/yr
LIABLE ENTITIES ± 600 entities
EMISSIONS COVERAGE 67%
ALLOCATION 100% free allocation, no auctioning
(97% and less than 90% free allocations in the coming phases)
FLEXIBILITY MECHANISMS Offset*, Banking, Borrowing
MARKET STABILIZATION MEASURE Market Stabilization, Early Action and New Entrants
PENALTY Three (3) times the average market price of allowances of the given compliance year, not exceeding KRW100,000/ton
(approx. USD 95/ton)

*. Note : Korea ETS allows the use of international offset credits up to 5% of the entity’s emissions submissions.

Marketdata

Market Price Information Link to KRX (Korea Exchange) - CLICK