POSCO and Hyundai Steel Emit 100 Million Tons of Greenhouse Gases... The Bill Is Coming Back

Yoon Administration Actively Promotes Carbon Neutrality in National Agenda
Emissions Must Be Reduced by 40% by 2030
Corporate Financial Burden Expected to Continue Increasing

[Asia Economy Reporter Oh Hyung-gil] It has been revealed that the greenhouse gases emitted directly and indirectly by POSCO Holdings and Hyundai Steel amount to 100 million tons annually.

As the Yoon Seok-yeol administration announced an active carbon neutrality promotion plan, the burden of reduction is expected to increase further for high greenhouse gas emitting industries such as steel, as well as oil refining and chemical companies. While they are rushing to adopt technologies to directly reduce greenhouse gas emissions, the cost burden for purchasing insufficient emission allowances is also expected to gradually increase.

According to the National Greenhouse Gas Comprehensive Management System on the 11th, among the target management companies, POSCO emitted the most greenhouse gases in 2020. It emitted 75.67 million tons of carbon dioxide equivalent (tCO2-eq) in one year.

Following that, Hyundai Steel recorded 28.62 million tons, showing that just these two steel companies emitted greenhouse gases amounting to 100 million tons. This accounts for 17% of the total emissions of 587.51 million tons, which is more than twice the carbon absorption capacity of all forests in South Korea, which was 43.23 million tons (as of 2019). However, POSCO and Hyundai Steel achieved reductions of 6.1% and 5.0%, respectively, compared to the previous year's emissions.

Samsung Electronics emitted 12.4% more than the previous year, totaling 12.53 million tons. Ssangyong C&E (formerly Ssangyong Cement) recorded 9.87 million tons, and among the top greenhouse gas emitters were mostly oil refining, chemical, and cement companies including ▲S-OIL 9.57 million tons ▲LG Chem 8.17 million tons ▲GS Caltex 7.78 million tons ▲SK Energy 6.92 million tons ▲Hyundai Oilbank 6.84 million tons ▲Sampyo Cement 5.98 million tons.

The Yoon administration plans to actively promote carbon neutrality policies to respond to the global decarbonization transition as a national agenda. According to the Nationally Determined Contribution (NDC), greenhouse gas emissions must be reduced by 40% by 2030 compared to the 2018 emissions (727.6 million tons). This means reducing to about 436.6 million tons.

Companies are also presenting management strategies to achieve carbon neutrality by 2050. POSCO Holdings established a Group ESG Council, and POSCO operates a Carbon Neutrality Committee and a Carbon Neutral Green Steel Technology Advisory Group. Hyundai Steel has also launched a Carbon Neutrality Promotion Team this year to establish a carbon-neutral steel production system and carbon neutrality strategies.

In particular, as major countries such as the European Union (EU) and the United States show moves to strengthen carbon trade barriers, the Ministry of Environment is considering increasing the current 10% paid allocation in the emissions trading system. Companies with high greenhouse gas emissions inevitably face increasing financial burdens for emission reductions.

According to the Financial Supervisory Service, the emission liabilities of the top 30 listed companies allocated emission allowances by the government in 2020 amounted to 709.2 billion won. Emission liabilities refer to funds for companies to fulfill carbon emission allowance submissions, and if greenhouse gas emissions exceed the free allocation amount, the scale of emission liabilities also increases.

POSCO Holdings covered 78.6 billion won in emission liabilities in 2020 and reflected 84.3 billion won last year. Hyundai Steel also recognized emission liabilities of 157.1 billion won in 2020 and 135.5 billion won in 2021.

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