The economy is currently in a recession, and with the negative impact of rising electricity prices due to greenhouse gas reductions, there are growing concerns that the business environment may become even more severe.
According to related industries on the 17th, the domestic steel and petrochemical industries are concerned about the Korean government's warm economic growth rate of 2035, and there are pessimistic views that this will lead to a continued rush of Korean factories to leave the country.
The company has set its greenhouse gas reduction target at "53% to 61% compared to fiscal 2018" and is revising its business plan to restructure its greenhouse gas reduction strategy.
According to the Department of Climate, Energy and Environment, industry must reduce greenhouse gas emissions by at least 209.1 million tonnes by 2035 compared to 2018.
Considering that the annual greenhouse gas emissions of Seoul are about 45 million tons, we would have to reduce the amount of greenhouse gas emissions that four Seoul cities emit in a year.
The Korean government plans to increase the proportion of paid allocations of emission rights to companies in order to reduce greenhouse gas emissions in the industrial sector.
The target is to gradually increase the share every year from the current 10% to 50% by 2030. Paid allocation of emission rights is a system in which the government sells rights to companies to emit greenhouse gases through auctions or other methods.
It is estimated that the power generation industry will have to pay a fee for the allocation in 2030, which will amount to several trillion won.
The prevailing view is that the impact will be passed on to electricity producers. Power generation companies use fossil fuels such as coal and liquefied natural gas (LNG) to generate electricity. The steel industry is making capital investments to reduce greenhouse gas emissions.
The country is still struggling to escape the deficit crisis caused by competing with low-priced products from China, but it needs to make large-scale investments to significantly reduce greenhouse gas emissions.
This is because they are in a position where they must make other investments at the same time. They are particularly nervous about the possibility of increases in electricity rates and carbon emission credit prices.
"We are in a situation where we have to spend hundreds of billions of won in additional funds to make up for the shortfall in rights," he said. The petrochemical industry is in a similar situation. Large companies are already suffering losses one after another.
The Korean government is currently leading a structural adjustment program. In this situation, the country is under pressure to increase production of eco-friendly products, which are expensive and less economical.
Furthermore, the petrochemical industry has already asked the South Korean government several times to lower electricity rates in order to overcome the crisis, but they are now in danger of seeing electricity rates rise.
Experts say the South Korean government's upward revision of its greenhouse gas reduction targets is unrealistic. However, companies are likely to accept the government's new standards.
As this is unavoidable, structural innovations such as increasing cash reserves to purchase emission credits and producing environmentally friendly, high-value-added products in the medium to long term are necessary, the report said.
Professor Lee Deok-hwan, emeritus professor of chemistry at Sogang University, said, "The targets set in 2018 were already difficult to achieve, so they have made another empty promise."
"What is impossible is impossible," said Professor Min Dongjun of the Department of New Materials Engineering at Yonsei University. "Korean companies are already moving overseas to use cheap energy.
"The focus is shifting," he said, adding, "With the upward revision of greenhouse gas reduction targets, this trend is expected to accelerate even further."
2025/11/18 07:09 KST
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