South Korean Parliament Approves Carbon Trading System

South Korea approved a cap-and-trade system to cut greenhouse gases as President Lee Myung Bak seeks support for new restrictions on factories and power plants in the fastest-growing emitter among industrialized democracies.

The National Assembly passed a bill to establish cap-and- trade, a market-based program that requires companies exceeding their emission quotas to buy permits from those that discharge less, with the backing of ruling and opposition parties, according to the assembly’s webcast of yesterday’s session. The bill, which calls for emissions trading to start in 2015, was passed in a 148-0 vote, with 3 abstentions.

“This is a truly significant moment, not only in terms of Korea’s national efforts to tackle climate change, but also because it underlines the emergence of a nascent Asian-Pacific carbon trading emissions hub with the potential to be a tipping point in the global fight against climate change,” said Terry Townshend, the Beijing-based director of policy for the Global Legislators Organization, a group known as Globe whose members include Bryony Worthington of the U.K. House of Lords.

Carbon markets in Korea, Australia and China may be linked with Europe’s emissions-trading system as early as 2020, according to Globe. Before that can happen, Korea’s president will have to sell the plan to domestic manufacturers who claim it will hurt their competitiveness in global markets. Lee pledged at the United Nations climate summit in 2009 to cut greenhouse by 30 percent from forecast levels by 2020.

(Source: Bloomberg)