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South Korea raised its emissions reduction target for 2030 and
laid out a decarbonization roadmap for the next 30 years, but the
initiatives are failing to satisfy either businesses or
environmentalists.
In a committee meeting on carbon neutrality 18 October,
President Moon Jae-in confirmed that Asia's fourth-largest economy
will aim to cut its GHG emissions by 40% compared with 2018 levels by 2030.
The revised Nationally Determined Contribution (NDC) will be
formally submitted to the UN during the COP26 climate summit in
Glasgow next month. In December 2020, South Korea
committed to a 26.3% emissions cut.
"This is the most ambitious reduction goal possible, given our
situation … Our goal is very fast paced and challenging," Moon
admitted. "Industry and labor may have major concerns about whether
they will ever be able to cope."
Government officials said the target was first proposed by the
Ministry of Trade, Industry and Energy (MOTIE) 8 October and came
after a public consultation.
In early September, South Korea's National Assembly passed the Carbon Neutrality
and Green Growth Act, which requires the country to cut emissions
by at least 35% by 2030 and reach carbon neutrality by 2050.
The parliament is controlled by Moon's Democratic Party.
"The government will render all possible policy and financial
support so the burdens are not shifted onto businesses alone," said
Moon, adding that the central government will commit KRW 12
trillion ($10.2 billion) to creating the path to carbon neutrality
in 2021.
South Korea will increase investments in technological
development and "do all it can to create new jobs and secure new
future growth engines to spearhead the carbon-neutral era," he
added.
Updated pathways
To achieve the new emissions reduction goal, MOTIE said South
Korea is aiming to increase the proportion of renewables in its
electricity generation mix from 6.2% in 2018 to 30.2% in 2030.
Seoul had previously targeted a 20% share by 2030 in its Renewable
Energy 3020 plan, which was announced in 2017.
Also, South Korea wants to cut coal's share of its power stack
from 41.9% in 2018 to 21.8% in 2030, and LNG's from 26.8% to 19.5%.
Ammonia will account for 3.6%, compared with zero in 2018.
"With the new NDC target, the government is prioritizing a
switch from coal and gas to renewables," said Vince Heo, associate
director for gas and power at IHS Markit. "The most notable update
in this new NDC release is the [increased] target share of
renewables in the electricity supply in 2030."
While Moon has committed to phasing out nuclear power in South
Korea eventually, MOTIE said the energy source will account for a
23.9% share in 2030, compared with 23.4% in 2018, in the
roadmap.
"Nuclear's role will be limited as the government aims to phase
out nuclear in the power market," Heo told Net-Zero Business
Daily.
"However, its share in the electricity supply mix will remain
[at] the current level through 2030 as there are four new nuclear
reactors under construction."
In the 9th Basic Plan for Electricity
Demand and Supply, released in December 2020, Seoul proposed a
40.3% share of capacity for renewables in 2034 versus 15.8% in
2020. Coal's slice of the generation pie is set to nearly halve to
15% from 28.1%, while gas-fired plants' share will fall to 30.6%
from 32.3%.
The plan will be reviewed in 2022, when South Korea's next
presidential election is due. Moon, who committed his country to
carbon neutrality by 2050, is not eligible to run for a second term
under the South Korean constitution.
Regardless of who will be the next president, Heo said South
Korea's climate goal is not expected to be affected. But the
roadmap could be revised.
"The NDC target is unlikely to change as there's mounting
pressure from the US and other partnering countries on keeping
emissions on a path to net-zero," he said. "The potential changes
in energy policy are likely be in nuclear energy, as the opposition
party is pushing hard to revive the industry."
Separately, the government narrowed down the number of its
pathways to reaching carbon neutrality by 2050 from three to two
following Moon's announcement.
Seoul scrapped a scenario where coal would still account for
19.1% of power mix, which was unveiled 5 August.
The first of South Korea's two potential routes to net zero
would see coal and LNG power phased out by 2050, renewables account
for 70.8% and hydrogen-based, zero-carbon gas turbines on tap for
21.5%. Nuclear will make up 6.1%.
In the second, coal will also be out, but LNG will retain a 5%
share. Renewables will account for 60.9%, fuel cells 10.1%, and gas
turbines 13.8%. Nuclear will have a 7.2% share.
Meanwhile, the government said it will make large investments in
carbon capture, utilization, and storage projects and develop
domestic and overseas carbon capture hubs.
Seoul wants the technology to help reduce South Korea's
emissions by 55.1 million metric tons (mt) of carbon dioxide
equivalent (CO2e) in the first pathway, and 84.6 million mt CO2e in
the second.
Unpopular policy
Green and business lobbyists both reacted negatively to the
latest climate initiatives.
The Korea Federation for Environmental Movement (KFEM),
affiliated to Friends of the Earth, said the government's plans
fail to align with the Paris Agreement's ambition of keeping the
global temperature rise below 1.5 degrees Celsius.
"Both the NDC and carbon-neutral scenarios consist of
insufficient targets and uncertain means to avert the climate
crisis," the environmental group said.
South Korea needs to reduce emissions by at least 50% and phase
out coal power by 2030 to help avert the climate crisis, according
to the KFEM.
With the country's highly competitive battery and vehicle makers,
government officials have long argued that South Korea is well
positioned to benefit from global decarbonization efforts.
In September, the country exported 34,823
electric vehicles, hybrid electric vehicles, plug-in hybrid
electric vehicles, and fuel-cell hybrid vehicles, a monthly record
and up 31.3% from a year earlier.
Industry experts believe South Korea could be a major market for
offshore wind power after the
government announced an 8-GW fixed-bottom project near Sinan, South
Jeolla in February
But the country is also home to some major steelmakers,
petrochemical producers, and metal smelters that require a lot of
electricity. The Federation of Korean Industries (FKI) expressed
worries over the climate initiatives' potentially negative impact
on the national economy.
"The energy efficiency of our industry is the highest in the
world…It is difficult to introduce innovative carbon reduction
technology," the business group said.
The FKI wants the government to review the reduction target for
2030 and consider shifting to nuclear energy to lower emissions in
the utility sector.
"It is difficult to introduce innovative carbon reduction
technologies and new energy like hydrogen and ammonia by 2030," the
FKI said on its website.
"The government should quickly come up with realistic
alternatives and strengthen support for carbon reduction technology
development," it added.
Walk the walk?
While Seoul has hiked its climate targets and announced major
headline figures for various initiatives—including the KRW 73.4 trillion Green New
Deal—since last year, policy experts said the government
did not provide enough concrete measures for reducing
emissions.
In the industrial, commercial, and residential sectors, Seo said
incumbent policies to date have had little success in incentivizing
electrification or allowing infrastructure to adapt to low-carbon
fuels.
The government has talked of low-carbon technologies, such as
carbon capture, without giving clear guidance on how their
deployment will be supported en masse, he said, adding that
"further regulatory and fiscal support for technological
development and new infrastructure will be needed to achieve the
scale of transformation."
According to the G20 climate policy report
card published by Ceres, Investor Group on Climate Change, and
Asia Investor Group on Climate Change 18 October, South Korea's
overall policy suite is in line with 3-4 degrees Celsius of global
warming—far above the Paris Agreement's target.
The country is set to emit 649-691 million mt of CO2e in 2030
with its current policies, missing the NDC target of 540 million
mt, think-tank NewClimate Institute Policy Analyst Jamie Wong
said.
"The government needs to significantly strengthen its climate
policies, even more so if the country is to achieve carbon
neutrality by 2050," he added.
As for the private sector, only listed companies with total
assets of KRW 2 trillion or more have to report environmental data
from next year. Firms are recommended but not required to follow
the standards set out by the Task Force on Climate-Related
Financial Disclosures.
The Science Based Targets initiative, a partnership between the
UN Global Compact, the World Resources Institute, the World Wide
Fund for Nature, and CDP (the non-profit formerly known as Carbon
Disclosure Project), gave South Korean firms a low mark when evaluating how G20 businesses
have aligned their climate targets with the Paris Agreement. A
total of 106 firms in the country have declared their goals to the
CDP, but none of them are aligned.
Yoo-Kyung Park, head of Asia-Pacific responsible investment and
governance at APG Asset Management, said the policy signals have
not been strong enough to prompt South Korean firms to decarbonize
in droves.
"The Korean government needs to act, so the industries can
actually prepare," she said.
Park cited the power sector—a major emitter—as an
example. While the government introduced an emissions trading
system in 2015, coal plants continue to receive large quantities of
free allowances. Wholesale electricity prices also have yet to
fully reflect emissions costs.
"The incentives for companies to quickly transit their energy
use and sources are not strong enough. The policy direction is not
strong enough. And the punishment [for big emitters] is not strong
enough," Park said.
Posted 21 October 2021 by Max Tingyao Lin, Principal Journalist, Climate and Sustainability