Insights

Climate Policy Priorities to Watch in an Uncertain 2025

ㅣTaehan Kim, COO of KoSIFㅣ

There was once a Korean documentary drama titled Fifty Years of Turbulence. It traced the turbulent course of Korea’s democratization from national liberation through the early 2000s. The program aired on MBC radio for 21 years before ending in October 2009.

Recently, works such as 12.12: The Day and The Fifth Republic have reportedly regained popularity. One day, dramas or films may also be made about the series of events unfolding before us now. When that happens, this moment may well be remembered as another period of turbulence. Future generations may even struggle to distinguish whether the extraordinary events surrounding martial law in 2024 were real or fictional.

Democracy is a system in which the will of the sovereign people is reflected through changes in political power. Change is therefore a natural part of democracy. When political power shifts, policies governing society and the economy also tend to change.

     An Uncertain 2025

The changes we face in 2025, however, are different. Both their scale and timing may exceed what can reasonably be anticipated. A turbulent year is beginning.

Those who must live through turbulence not as history, but as the present—and as part of everyday life—must remain attentive. This is necessary both to prevent democratic backsliding and to navigate rapid change while continuing with daily life.

The year begins with Donald Trump’s inauguration. On January 20, he will formally take office as the 47th President of the United States. Depending on the Constitutional Court’s decision, Korea may also hold a new presidential election during the first half of the year.

External uncertainty stemming from the Trump administration will therefore coincide with a temporary gap in Korea’s diplomatic capacity and uncertainty over the direction of domestic policy.

     Major Climate Policy Developments in 2025

Few areas of society or the economy are free from uncertainty, but climate policy may be among those facing the greatest disruption.

In addition to the risks associated with the Trump administration, Korea is scheduled to make several major mid- and long-term climate policy decisions in 2025. Some could result in substantial policy changes.

The following are the key climate policy developments that should not be overlooked as Korea navigates this period of uncertainty.

     Climate Litigation and Revision of the Carbon Neutrality Framework Act

Beginning with a constitutional complaint filed by Youth 4 Climate Action in 2020, five climate lawsuits were brought on the grounds that Korea’s climate policies—including the Framework Act on Carbon Neutrality and Green Growth—violated the fundamental rights of citizens and future generations.

On April 25, 2024, the Constitutional Court ruled that Article 8(1) of the Act was not in conformity with the Constitution because the national greenhouse gas reduction target did not provide a reduction pathway for the period from 2031 to 2049. The Court required the relevant provision to be amended by February 28, 2026.

In December 2024, the Ministry of Environment launched the Climate Future Forum to develop alternative legislation, including emissions-reduction pathways through 2050.

The forum consists of 48 members divided between an emissions-reduction committee and a future-society committee. Its purpose is to develop multiple reduction pathways, review them, and formulate a legislative amendment.

The government or government-affiliated institution serving as the forum’s secretariat will play a significant role in this process. Changes in the political landscape may therefore influence the reduction pathways ultimately proposed through the forum.

     Korea’s 2035 Nationally Determined Contribution

Under the Paris Agreement, all parties to the United Nations Framework Convention on Climate Change must establish national emissions-reduction targets and submit new targets every five years that represent a progression beyond their previous commitments.

All 195 parties have submitted 2030 nationally determined contributions. Korea’s current target is to reduce greenhouse gas emissions by 40 percent from 2018 levels by 2030.

The UNFCCC Secretariat requested that all parties submit their 2035 NDCs by February 2025. The Ministry of Environment is currently leading analytical work and stakeholder consultations for Korea’s new target. On October 28 last year, the Presidential Commission on Carbon Neutrality and Green Growth also held a conference on the 2035 NDC.

For the target to be finalized, it must be reviewed and approved by the Commission and reported to the National Assembly.

Following the Constitutional Court’s decision, the Carbon Neutrality Framework Act must also be amended to include an emissions-reduction pathway through 2049. The process of establishing the 2035 NDC is therefore likely to be closely linked to this legislative revision.

Given that the composition of the Commission has changed substantially whenever administrations have changed, and considering the current situation in the National Assembly, it appears difficult for both the Commission’s approval and the parliamentary reporting process to be completed by February.

It is also possible that substantive work on the NDC will resume only after the impeachment process and a potential presidential election have concluded.

The Fourth Phase of Korea’s Emissions Trading Scheme, 2026–2030

Korea’s emissions trading scheme covers more than 70 percent of national greenhouse gas emissions and is one of the country’s most important policy instruments for meeting its reduction targets.

Introduced in 2015, the scheme will enter its fourth phase in 2026. The first phase covered 2015–2017, the second 2018–2020, and the third 2021–2025.

Despite its importance, the scheme is widely regarded as having made only a limited contribution to emissions reductions. The main reasons include excessive allowance allocation, a high share of free allocation, and allowance prices that have remained at roughly one-tenth of European levels.

The fourth phase will be critical to determining whether Korea meets its 2030 NDC.

In November 2024, the Ministry of Environment held a public hearing on the draft Fourth Basic Plan for the Greenhouse Gas Emissions Trading Scheme. Key issues include the overall emissions cap, the sectors and share subject to auctioning, and the expansion of benchmark-based allocation.

The government originally planned to finalize the plan by the end of 2024 following review by the Carbon Neutrality and Green Growth Commission and the Cabinet.

The 11th Basic Plan for Electricity Supply and Demand, 2024–2038

The Basic Plan for Electricity Supply and Demand is a national plan that forecasts electricity demand over the next 15 years and sets out the corresponding supply strategy. It is updated every two years.

The first plan was established in 1982. The 10th Plan, covering 2022–2036, was finalized in January 2022. In May 2024, the government released a working draft of the 11th Plan, covering the period from 2024 to 2038.

Together with industry, the power sector accounts for the largest share of Korea’s greenhouse gas emissions. Given that electrification is central to the net-zero transition, decarbonizing electricity supply is essential to meeting national reduction targets.

The plan covers not only large-scale generation facilities such as coal and liquefied natural gas plants, but also the expansion of renewable energy. It has therefore attracted growing attention from companies facing increasing demand for renewable electricity through initiatives such as RE100.

The 11th Plan was originally expected to be finalized in 2024, but—as with the other major policy processes—its completion may be delayed.

The working draft also includes plans for new nuclear power plants and small modular reactors. Depending on future political developments, substantial revisions to the plan cannot be ruled out.