Government Revamps Local Carbon Neutrality Budget Management System

The government is establishing guidelines for the operation of greenhouse gas reduction budgets at local governments. This initiative aims to standardize the previously varied methods of implementing greenhouse gas reduction budgets across different municipalities, enhancing the effectiveness of climate response financing.

The Ministry of Climate, Energy, and Environment announced on June 29 that it will distribute a "Guideline for the Operation of Greenhouse Gas Reduction Budget Systems" starting June 30 to support local governments in adopting and managing these systems.

The greenhouse gas reduction budget system allows both national and local governments to analyze the impact of budgets on greenhouse gas reductions in advance and incorporate these findings into financial operations and policy decisions.

This system was introduced at the national level following the enactment of the "Basic Law on Carbon Neutrality and Green Growth" in 2022, and since the 2023 fiscal year, the government has been submitting information related to greenhouse gas reductions in its budget statements to the National Assembly.

While some local governments have operated the system based on their own ordinances, there have been criticisms regarding the differing application standards, leading to regional disparities. The government plans to reduce these differences through the new guidelines.

The guidelines focus on standardizing aspects such as the scope of applicable projects, classification of reduction initiatives, and methods for analyzing reduction effects, making them useful for local governments preparing to implement or already operating the system.

Notably, the guidelines include not only direct greenhouse gas reduction projects but also initiatives that yield indirect reduction effects, such as research and development (R&D) and policy support, allowing for more systematic management of project outcomes.

The government expects that these guidelines will provide a foundation for managing greenhouse gas reduction projects across municipalities using the same criteria and for comparing and analyzing their results.

Following the distribution of the guidelines, the ministry will hold explanatory sessions for officials to support the implementation of the system and will continuously refine the guidelines based on local government practices and feedback.

Lee Kyung-soo, Director of Climate Energy Policy at the Ministry of Climate, stated, "The greenhouse gas reduction budget system is a crucial tool for analyzing how budgets contribute to greenhouse gas reductions and reflecting those results in policy direction and investment priorities. We hope this guideline will assist local governments in establishing the system and systematically managing the effects of greenhouse gas reductions."