We have expanded the list of climate policies we assess company engagement with to incorporate land-use related policy, referring to legislative or regulatory measures to enhance and protect ecosystems and land where carbon is being stored. Assessments under this category are currently underweighted in terms of their contribution to the overall company metrics. This weighting will be progressively increased over the next 6 months.
We adjusted the terminology used to describe the queries running down the left-hand side of our scoring matrix and added additional explanatory text to the info-boxes. This has no impact on the scores and methodology. It has been done following user feedback to improve clarity.
Climate Policy Engagement Overview: The Independent Power Producers Association (IPPA) appears to have limited and highly negative engagement with climate policy in South Korea. The association has taken negative positions on the need for climate action in its top-line messaging. It has taken highly negative positions on the transition of the energy mix away from fossil fuels.
Top-line Messaging on Climate Policy: IPPA appears to take negative positions on the need for drastic climate action in its top-line messaging. In a September 2021 position paper, IPPA did not support the 2050 Carbon Neutrality Scenario of the Korean government, stating that it would be reasonable to adjust carbon neutrality measures in consideration of social conflicts and excessive economic cost. As reported by Electronic Times in December 2021, the Vice Chairman of IPPA, Yu Yeon-baek, opposed the 2050 Carbon Neutrality Scenario, stating concerns that the carbon neutrality goal was too ambitious and there was not enough consideration of problems that would be caused by focusing on renewable energy.
Engagement with Climate-Related Regulations: IPPA appears to have limited engagement on climate policies in South Korea. As reported by Hankyung in April 2022, the association stated support for the 2030 Nationally Determined Contribution (NDC) in a policy recommendation to the South Korean government. However, in a position paper on the 2050 Carbon Neutrality Scenario in September 2021, IPPA did not support a reform of the Korea Emissions Trading Scheme (K-ETS) that proposed increasing the ratio of paid emissions allowances in the scheme.
Positioning on Energy Transition: IPPA appears to take broadly negative positions on the transition of the energy mix. In April 2022, the Chairman of IPPA, Choo Hyung-wook, appeared to advocate for the continued role of coal-fired power generation in the energy mix, referring to coal as a ‘stable energy source’. As reported by Hankyung in May 2022, IPPA stated support for the maintenance of newly established coal-fired power plants in a letter sent to the Presidential Transition Committee. In a position paper on the 2050 Carbon Neutrality Scenario in September 2021, the association advocated for the continued role for coal in the energy mix for stable power generation. In the same position paper, the association stated support for LNG in the energy mix without placing clear conditions on the need for CCS or methane abatement measures, referring to the economic feasibility of LNG and that it would contribute to achieving carbon neutrality. In the same position paper, IPPA also supported expanding renewable-based power generation with exceptions, stating concerns over technical and economic feasibility in consideration of the climate and topography of South Korea.