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S.Korea's carbon trading to cost $27 bln; should be delayed -business
July 16, 2014 / 5:36 AM / 3 years ago

S.Korea's carbon trading to cost $27 bln; should be delayed -business

SEOUL, July 16 (Reuters) - South Korea’s emission trading to start next year will cost a total of 27.5 trillion Korean won ($26.64 billion) for the next three years and should be delayed to 2020, a business lobby group said.

The scheme is due to start January 1, 2015 to cap greenhouse gas emissions from over 400 of the country’s major polluters such as power generators and manufacturers. It aims to cut emission in 2020 at 30 percent below business-as-usual levels.

“Given unfriendly domestic and overseas business environment, the scheme if launched in January of 2015 would hurt industrial competitiveness severely,” the Federation of Korean Industries (FKI) said in a statement on Tuesday.

Another private research entity Korea Economic Research Institute said in a statement on Wednesday the scheme would slash manufacturing sales by up to 29.6 trillion won a year.

In a response to the FKI statement, ministries of environment, finance and trade said in a joint statement late on Tuesday the scheme will be launched as planned as it has already been lawfully sealed after reaching social agreement.

The joint statement noted South Korea is one of the 62 countries which voluntarily set goals to cut emission, while 37 other countries are required to reduce emission.

Asia’s fourth-largest economy emitted 669 million tonnes of carbon dioxide equivalent in 2010, making it the world’s eighth biggest emitter.

Firms will be given free permits by the government based on their historical emission levels, but must buy more in the market if their emissions exceed allocated levels. The amount of free permits given out will reduce over time. ($1 = 1032.4000 Korean Won) (Reporting by Chris Lee; Editing by Michael Perry)

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