South Korea Begins Building Infrastructure for Carbon-Emissions Futures Market

정부가 온실가스 배출권 시장 고도화에 나선다. 현물 거래 중심으로 운영되며 가격 변동 대응에 한계가 있다는 지적이 이어지면서 배출권 선물시장 도입을 위한 기반시설 구축 작업에 본격 착수한 것이다. 

The South Korean government is moving to upgrade its greenhouse gas emissions trading market, launching work to build the infrastructure needed to introduce an emissions-permit futures market as criticism grows that the spot-focused system has limited tools to cope with price swings. 

The Ministry of Climate, Energy and Environment said it will hold an “advanced greenhouse gas emissions market meeting and memorandum of understanding ceremony” on the morning of April 24 at the Korea Exchange’s Seoul office in Yeongdeungpo-gu, Seoul. The ministry said it will review the outlook for the fourth phase of the emissions market and discuss future development steps, including building infrastructure for an emissions futures market. 
 
The event was arranged to discuss mid- to long-term policy directions for South Korea’s emissions trading system, known as K-ETS, and to set up a cooperation framework among related agencies in advance for building the computerized systems that would underpin a futures market. 

South Korea’s emissions trading market has largely operated through spot transactions, making it difficult for companies to prepare for long-term price volatility. Experts have said that introducing an emissions futures market — similar to major overseas markets such as the European Union — could provide companies with a more efficient hedging tool and improve market stability by strengthening price-discovery and forecasting functions. 
 
In the first session, experts from the financial and industrial sectors and related institutions will discuss key tasks for the market going forward. 

Ha Sang-seon, a division head at Ecoeye, will present on “the characteristics and outlook of the fourth phase of the emissions trading system market.” Yoo Jong-min, a professor at Hongik University, will offer recommendations on the “need for an emissions futures market and expected effects” from a long-term perspective. A subsequent discussion will address the need for a futures market to help companies manage price volatility, along with measures to ensure detailed market design and system stability. 
 
In the second session, the ministry, the Korea Exchange, the Greenhouse Gas Inventory and Research Center, and Koscom will sign an agreement to build infrastructure for an emissions futures market. 

The four organizations plan to cooperate on developing smooth links among their existing systems, building the human and physical foundations needed to operate futures trading, and sharing information to foster a sound emissions-related financial market. 

Oh Il-young, director general for climate and energy policy at the ministry, said stable introduction of an emissions futures market requires “a solid system buildout and a cooperative framework among related institutions.” He said the agreement will be used as an opportunity to lay the groundwork for upgrading the market.