In September, the South Korean Ministry of Environment released the final allocation plan for the first phase of its planned emissions trading scheme, which is scheduled to launch in January 2015 (National Allocation Plan – Korean). The cap for 2015–2017 is set at 1.687 billion tCO2e, including a reserve of 88 million tCO2e for market stabilization measures, early action and new entrants. Permits will be grandfathered among 526 business entities from 23 different sectors. The overall cap is slightly higher than the one announced in the draft allocation plan published in June (press release), which was amended in the face of strong opposition from industry.

Entities covered by the ETS (companies with annual emissions over 125,000 tCO2e and individual installations with annual emissions over 25,000 tCO2e) had to submit their allocation application by 14 October. The Allocation Decision Review Committee will make a final decision on allocation to individual entities in November. According to the plan, banking is permitted within one year of the subsequent commitment period, while borrowing is permitted up to 10 % of the budget for next year.

In order to strengthen the administrative procedures for emissions trading, the Korea Exchange and the Ministry of Environment have jointly organized an online simulated cap-and-trade market, which will be open from 29 September–22 October and from 27 October–24 December. It is designed to help market participants test the entire trading process, such as the submission and approval of allocation plans, certificate delivery and MRV (Ministry of Environment – Korean).