"Concerns Over Business Deterioration Amid Push to Raise 2030 Greenhouse Gas Reduction Targets"

[Asia Economy Reporter Jeong Hyeon-jin] Recently, regarding the greenhouse gas reduction targets being promoted by the government and the National Assembly, it was found that 84% of domestic companies are concerned that their management will deteriorate. Seven out of ten major greenhouse gas emitting companies evaluated the 2030 Nationally Determined Contribution (2030 NDC) specified in the recently passed "Carbon Neutrality Basic Act" by the National Assembly as excessive.

On the 4th, the Federation of Korean Industries commissioned the public opinion research firm Mono Research to conduct a survey on the 2030 NDC and carbon neutrality policies from the 6th to the 16th of last month targeting 350 companies subject to the Greenhouse Gas and Energy Target Management System (126 companies responded).

The survey results showed that 68.3% of respondents considered the 2030 NDC specified in the Carbon Neutrality Basic Act to be excessive, and 84.1% expected negative impacts on management due to the upward revision of the 2030 NDC. The most common reason for considering the 2030 NDC excessive was "increased corporate burden due to emission permit purchases and strengthened regulations" (39.5%), followed by "limitations in reduction capacity under a manufacturing-centered industrial structure" (34.9%), "impossibility of commercializing carbon reduction technologies by 2030" (18.6%), and "increased corporate burden such as electricity price hikes due to limits in expanding renewable energy generation" (7.0%).

(Data provided by the Federation of Korean Industries)

The 2050 Carbon Neutrality Committee proposed in the "Carbon Neutrality Scenario Draft" a plan to reduce industrial sector greenhouse gas emissions by 79.6% compared to 2018 by 2050. Regarding this, 80.9% of responding companies considered it excessive, while 19.1% responded that it was appropriate or insufficient. Additionally, when averaging responses about the level of electricity price increases if the power mix proposed by the Carbon Neutrality Committee?significant expansion of renewable energy and reduction of nuclear power generation?is realized, electricity prices are expected to rise by 26.1%.

When asked about their response status to carbon neutrality policies, only 3.2% of companies answered that they had "completed establishing a response plan," 67.4% said they were "in the process of establishing a response plan," and 29.4% said they had "not yet responded."

The most urgent policy task in promoting carbon neutrality was "establishing reduction targets through active collection of industry opinions," which accounted for 35.3%. This was followed by "support for facility investment to reduce greenhouse gases" (21.4%) and "building new energy supply infrastructure such as renewable energy and hydrogen" (14.4%).

Yoo Hwan-ik, Director of Corporate Policy at the Federation of Korean Industries, said, "Considering the manufacturing-centered industrial structure, the impossibility of early commercialization of carbon reduction technologies, and the limits of expanding renewable energy, it is necessary to sufficiently collect opinions from the industrial sector, which is responsible for reductions, and reflect them in future target setting and policy formulation."

This content was produced with the assistance of AI translation services.