South Korea becomes the latest Asian economy to announce its net-zero carbon emissions pledge.
Wood Mackenzie Asia Pacific Head of Markets and Transitions, Prakash Sharma said: “South Korea’s announcement follows Japan’s recent pledge to become a carbon-neutral society by 2050. Both countries have similar fuel mix with 80 percent share of hydrocarbons in primary energy supply. Renewables (excluding hydro) is under 2 percent while nuclear takes up 15 percent. The goals are hugely aspirational and daunting.
“South Korea also plans to phase out nuclear and shut down coal-fired power plants longer term. However, the timeline is not clear. This means a deep decarbonisation in South Korea will rely on faster adoption of new technologies. LNG will likely play a crucial role in South Korea’s transition.
“In our scenario modelling for South Korea, electrification expands rapidly and is increasingly supplied by renewables, battery storage, hydrogen and carbon, capture and storage (CCS). The transport sector becomes fully decarbonised by 2050 using electric vehicles and fuel cell vehicles. Share of hydrocarbons is expected to fall to approximately 40 percent by 2050.
“South Korea has an advantage. It already has an established emissions trading scheme in place. This is an important mechanism to deliver the changes required in the power and industrial sectors on the basis of cost and carbon, to reach net-zero in emissions. Carbon price levels in South Korea currently hovers around US$30 per tonne. We expect it to increase to upwards of US$100/t in order to deliver a net-zero emissions outcome.”