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Republic of Korea · Emissions trading system

Korea Emissions Trading Scheme (K-ETS)

The K-ETS launched in 2015 as East Asia's first nationwide mandatory ETS and covers 813 of Korea's largest emitters. Its fourth phase began in 2026 under an allocation plan approved in November 2025 that sets a cap of 2.5 billion tCO2e for 2026–2030, introduces a market stability reserve and raises the share of auctioned allowances.

In forcesince 2015Verified 4 Oct 2026

The K-ETS is a cap-and-trade system established under the Act on the Allocation and Trading of Greenhouse Gas Emission Allowances and its Enforcement Decree, originally within the framework of the Framework Act on Low Carbon, Green Growth (2010), which has since been replaced by the Carbon Neutrality Act. Covered entities must surrender allowances for their emissions; in 2023 the system covered 77.75% of national greenhouse gas emissions.

Phase 4 runs from 2026 to 2030. The National Emission Allowance Allocation Plan approved in November 2025 sets a total cap of 2.5 billion tCO2e for the period, introduces a quantity-based Market Stability Reserve (K-MSR) and increases the share of auctioned allowances. The 2025 cap was 562.5 MtCO2e.

Legal journey

From proposal to operation

  1. Enacted

    Act on the Allocation and Trading of GHG Emission Permits enacted (Act No. 11419)

    law.go.krOfficial
  2. In force

    K-ETS launches; Phase 1 runs 2015 to 2017

    icapcarbonaction.com
  3. Milestone

    Phase 3 begins, extending coverage to more transport and construction

    icapcarbonaction.com
  4. Milestone

    Phase 4 allocation plan approved: 2.5 billion tCO2e cap for 2026-2030

    icapcarbonaction.com

Each milestone links to the page it was checked against. Dates are given only to the precision the source supports.

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