The government has codified a "market stabilization reserve system," which adjusts auction supply by injecting reserves if the emissions allowance price falls outside a set range. Following the European Union (EU) and California, the United States, Korea has also established a price safeguard for allowances.
The Ministry of Climate, Energy and Environment said on the 21st that a partial amendment to the Enforcement Decree of the Act on the Allocation and Trading of Greenhouse‑Gas Emission Permits was approved at a Cabinet meeting. The revised decree takes effect on the 29th.
The market stabilization reserve system is a mechanism that curbs price volatility by adjusting auction supply using pre‑secured reserves when allowance prices or transaction volumes deviate from preset reference ranges.
If prices rise above the reserve supply price (ceiling) or fall below the auction withholding price (floor) publicly notified after review by the Emissions Allocation Committee, the climate ministry will be able to inject reserves. The specific price range of the reserves and detailed operating plans will be finalized by Aug. 8 after gathering stakeholder feedback and expert discussions.
The amendment also clarifies criteria for canceling designation of obligated entities. Corporations whose previous year's emissions fell below 3,000 tons due to business site closures or sales can be exempted from the emissions trading obligations even during the current "five‑year planning period." Previously, even if emissions fell sharply, the burden had to be borne until the end of the planning period.
In addition, surplus entities, such as corporations with excellent emissions efficiency, can receive additional allocations if they meet conditions for new or expanded facilities, as requirements have been eased. Increases in emissions due to disaster waste disposal will also be recognized as grounds for additional allocation.
O Il‑yeong, director general for climate and energy policy at the climate ministry, said, "This enforcement decree revision codifies improvement measures derived through communication with all sectors, including industry and experts, when establishing the 4th allocation plan," adding, "We will continue to seek ways to rationalize the system while maximizing corporations' reduction efforts."