South Korea passes cap-and-trade system, joins world leadership in fight against climate change

(Washington – May 2, 2012)  South Korea has become the first Asian country to pass climate change legislation capping its carbon emissions, joining the vanguard group of nations leading the charge against climate change.

The bill, approved today by Korea’s National Assembly on a near-unanimous vote, establishes a cap-and-trade system for limiting the country’s growing carbon emissions.

South Korea’s move comes only weeks after Mexico passed domestic climate legislation that aims to increase renewable energy use, set ambitious goals to curb domestic emissions and establish a high-level climate commission authorized to create a domestic carbon market.

“South Korea’s bold move is evidence that fast growing economies can put a limit on dangerous carbon emissions with broad support from elected leaders, and of the mounting desire and momentum to curb climate change across both the developed and developing world,” said Richie Ahuja, EDF’s Regional Director for Asia.

“Such visionary actions by countries is how the global climate race will be won,” Ahuja said.

The South Korean bill will limit emissions from top polluters across the economy through a cap-and-trade system slated to start in 2015.  About 60 percent of South Korea’s greenhouse gas emissions will be covered, which puts the government on track to fulfill its international pledge to reduce its greenhouse gas emissions 30 percent from projected levels by 2020. The legislation will also allow Korea’s system eventually to link internationally with other emissions trading systems, and the government and Australia have already announced plans to initiate such talks later this year. 

Final details of the law will be worked out in the coming months and issued as part of a Presidential Decree, which the Presidential Commission on Green Growth and related ministries are preparing.

Cap-and-trade systems, like the one in Korea’s law, have been successful in curbing carbon emissions; the world’s first and largest multinational cap and trade program to reduce climate-warming pollution, Europe’s Emissions Trading System, has played a significant and successful role in reducing the EU’s global warming pollution.

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