South Korea yesterday announced the launch of its first carbon trading firm, according to reports.
South Korea’s Energy minister said Korea Carbon Finance will begin emissions trading later this month, financed with 5 billion won (US$4.3 million) from Korea Investment Securities and private companies.
The company will trade carbon offset credits (CERs) generated by companies in South Korea that have reduced carbon emissions.
Under the Clean Development Mechanism (CDM) created by the Kyoto Protocol, companies in developing nations, like South Korea, can sell CERs to companies in rich, developed nations to allow them offset their carbon emissions.
According to Reuters, South Korea has the fourth largest market for CDM emissions reduction projects, behind China, India and Brazil.
The worldwide CDM market is worth US$13 billion.
Korea Carbon Finance will also secure investments from private equity funds to invest in carbon derivatives and domestic greenhouse gas reduction projects.
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