Preparations for the launch of the Korean emissions trading system (ETS) on 1 January 2015 are nearing completion. On 28 November 2015, the Ministry of Environment informed entities participating in the first phase of the program (2015-2017) of their individual allocation (press release – Korean). This follows the publication of the overall cap for the same period in September.

1.598 billion allowances have been allocated from the three-year cap of 1.687 billion tCO2e. The remaining 89 million allowances will be placed in a reserve for new installations joining the ETS or covered installations whose capacity will significantly increase.

525 business entities from 23 sectors – accounting for about two thirds of Korea’s national emissions – were allocated emissions quotas for the first phase of the system.

Sectors receiving the largest shares of allowances are the electricity and energy sector (738.5 MtCO2e for 38 business entities), the steel industry (305.7 MtCO2e for 40 companies) and the petrochemical sector (143.7 MtCO2e for 84 entities). Other sectors covered by the ETS include the cement, automobile, electromechanic and electronic industries, buildings and the waste sector. In addition, five airlines will participate in the Korean ETS. Companies have one month to file objections if they want to appeal their individual emissions quotas.

As announced in September, the annual ETS cap will gradually decrease from 573 MtCO2e in 2015, to 562 MtCO2e in 2016 and 551 MtCO2e in 2017, in spite of an expected growth of emissions in a business as usual scenario.