Everything you need to know about the Korean Emissions Trading Scheme (KETS)

All compliance carbon markets seem to go through the same growing pains. The South Korean Emissions Trading Scheme (KETS) is no different.

That being said, the Korean government face a unique set of challenges. In particular, legacy issues surrounding the country’s past support for industry, and the fallout from a severe economic downturn due to the pandemic and the government’s strict policies.

Nevertheless, the future competitiveness of its largest and most successful businesses now depend on the country reforming its carbon market to provide a strong signal for decarbonisation.

KETS was launched at the start of 2015 and has one of the widest coverage of any compliance carbon market, accounting for almost three-quarters of South Korea’s emissions. The scheme includes power generation, industry, buildings, transport, aviation, and waste. Only New Zealand’s emissions trading scheme (ETS), which also includes forestry, covers more of the economy (see New Zealand's carbon market: The carbon trade you've probably never heard of).