The government will remove the carbon credit price from the criteria for free allocation of carbon credits. There have been continued criticisms that, because the credit price was included in the criteria, corporations found it hard to predict whether they would receive free allocations in practice.
The Ministry of Climate, Energy and Environment said on the 16th that a revision to the Enforcement Decree of the Act on the Allocation and Trading of Greenhouse Gas Emission Permits containing these measures was approved at a Cabinet meeting. The revision will take effect on the 19th.
This enforcement decree revision is a follow‑up measure to the Act on the Allocation and Trading of Greenhouse‑Gas Emission Permits amended on Oct. 28. The government allocates credits to corporations whose greenhouse gas emissions exceed a certain threshold and requires them to purchase credits if they go beyond that. Whether to allocate for free and the share of paid allocation have been decided every five years by considering each corporation's total carbon emissions and the credit price, among other factors.
However, as the credit price fluctuated widely from 7,000 won to 40,000 won, concerns were raised that it burdened corporations in setting management plans. In response, the government decided to exclude the credit price from the allocation criteria and to use only the total amount of carbon emissions as the basis.
In addition, the allocation criteria were changed from the company level to the business site level. An official at the climate ministry said, "Even among business sites of the same nature, different free and paid allocation criteria have been applied depending on the industry of the owning corporations."
Based on the allocation criteria established through this enforcement decree revision, the climate ministry plans to complete the preliminary allocation within the year for the fourth planning period (2026–2030).