Republic of Korea approves 2030 GHG roadmap and 2nd phase ETS allocation plan.

On 24 July 2018, the Cabinet of the Republic of Korea approved the 2030 greenhouse gas roadmap and the allocation plan for the second phase (2018-2020) of the national emissions trading system (ETS). Both are key elements of the Republic of Korea’s strategy to achieve their Nationally Determined Contribution (NDC) goal for 2030 under the Paris Agreement.

The roadmap provides details at three year intervals of the indicative emissions levels required for the country to achieve its reduction target (536 MtCO2e in 2030), as well as sector-specific reduction targets compared to 2030 Business-as-Usual emissions levels (see draft roadmap here). According to the roadmap, national emissions are expected to peak around 2020. The plan also reduces the scope for international offsets, increasing the share of domestic mitigation necessary to reach their NDC target.

 Minimal changes were made to the final Allocation Plan, which sets a total of 1,777 billion allowances to be issued to 591 companies from 2018-2020 for the national ETS. This represents an increase compared to the first phase, taking into account the expansion of the covered entities and the adjustment of emission coefficients in the second phase (for more details see draft allocation plan). The total allowance cap comprises 1,689 billion allowances, as well as an additional 134 million allowances for a New Entrants Reserve. In addition, 19 million will be set aside for market stability purposes. Only 97% of the allowances in the second phase will be allocated for free; the remaining three percent will be auctioned.