Investing in the Emission Trading System: an interview with environmental activist Oh Byung-ho

C02gether interviewed Oh Byung-ho, member of the Presidential Committee on Carbon Neutrality and Green Growth. He is also an active member of the Gangwon-do Environmental Education Promotion Committee, and has founded the nonprofit environmental organization "Big Wave," as well as the Korean ESG Society.

From his expertise on the emission trading system (ETS) to potential policy changes, Oh shared us insights into the current implementation and future trajectories of the ETS. He offered accounts on the challenges that prevent the benefits of ETS from changing the world. 

What do you think is the biggest obstacle in the current Emissions Trading System (ETS) in terms of regulation and policy?

More than external factors or oversupply, the biggest issue is measurement. For example, even if a company reduces 1 ton of emissions, it's recorded as 2 or 3 tons. Because the reports are inaccurate, the supply appears higher than it actually is. As a result, the system lacks the ability to properly incentivize those who genuinely reduce emissions. The Ministry of Environment also does not take responsibility or make improvements, while the EU has a well-structured pricing mechanism and does not allow uncertified private trading.

Despite these obstacles, we can see that conversations about ETS are still ongoing. So what is the biggest strength of the Emissions Trading System?

The main advantage of the ETS lies in its ability to achieve carbon reductions in a cost-effective way through market mechanisms. For example, if Company A needs 50,000 won to reduce 1 ton of emissions while Company B can achieve the same for just 20,000 won, it is more efficient for B to reduce emissions and sell that credit to A. This lowers the total societal cost of carbon mitigation.

I think what sets ETS apart is that unlike traditional regulations, it provides economic incentives—those who reduce emissions benefit financially. So with proper design, it can become a key tool in climate policy because when people realize that reducing emissions leads to financial gain, participation increases. Clear standards, accountability, and sophisticated policy coordination also help prevent public backlash.

Then for those benefits to help us achieve net zero, what are some ways to activate the carbon trading market?

First of all, Korea must improve price stability and predictability. Currently, there is no price floor, so a drop in demand can lead to a market collapse, so we can consider measures like the Market Stability Reserve (MSR) used in the EU. We should also work toward international standardization—each country has different standards, and Europe has more detailed and accurate emissions tracking. This is a necessary step because with the carbon border tax,  when companies make deals abroad and come back to Korea, the prices change again, so there’s a lack of trust that deters companies from participating in the emission trading market.

In addition, the government should support the development of private-sector trading platforms. Currently in Korea, emission trading is limited to a single platform, the Korea Exchange (KRX), with very few participants. So Korea should adopt a model similar to the EU, allowing emission trading through private certification bodies and introducing digital carbon brokerages that could lower participation barriers. 

Another method is integrating with voluntary carbon markets (VCMs) and expanding Scope 3 emissions tracking. With the implementation of the EU’s Carbon Border Adjustment Mechanism (CBAM), Korean companies must urgently address product-level emissions and supply chain reductions. Currently, Korea's Scope 3 reduction rate is below 20%, which is only about half that of developed countries. So, there needs to be greater linkage between corporate-led reduction projects and VCM certification systems (such as KOC). 

What role do corporations play in activating the Emissions Trading System?

Corporations must shift from passive compliance to becoming active participants in climate finance and carbon management. Some key strategies are setting science-based targets (SBTi), joining initiatives like RE100 and CDP for global supply chain recognition, and building carbon credit portfolios.

As of 2023, 28 Korean companies have joined RE100, and their average reduction rate is 3.2 percentage points higher than non-member companies. However, only 18% of KOSPI-listed companies include Scope 1–3 reduction targets in their sustainability reports, which shows a major gap in ESG disclosure readiness.

Carbon credits are no longer a cost but a strategic asset. When companies treat them as a resource rather than a burden, they can gain long-term competitive advantages. 

Beyond his thoughts on the ETS, Oh also talked about his career as a passionate environmental education activist. Having worked in the field for several years, he has accumulated many valuable experiences and connections with fellow passionate climate activists. 

As an environmental education activisit, what kinds of work do you do?

I work on promoting lifestyle changes, such as getting people certified for biking, reducing standby power and household electricity usage, cutting energy costs for commercial buildings, encouraging reduced meat consumption, and promoting green consumption habits.

Apart from environmental education, what has been your most memorable experience while working for the environment and environmental policy?

One memorable effort was encouraging people to reduce their use of cloud storage (like emails) and media streaming. I’ve learned that the way you see policy is crucial—individual participation is the heart of change, and citizen action is what shapes actual policy.

What advice would you give to youth interested in environmental policy?

I would recommend first studying relevant policy materials so that you can better understand existing climate policies. Resources from the National Assembly Research Service, the Carbon Neutrality and Green Growth Commission, and the Korea Environment Institute (KEI) can help you. In my opinion, hands-on volunteering and experience can make you more engaged in this work. Try joining citizen group volunteer programs, enter climate-related idea competitions, and participate in mock national assemblies or regional policy groups. These can help you understand how policies are implemented in real life.

Coming to an end with the interview, Oh left an inspiring closing message for the future climate leaders of tomorrow. 

Carbon neutrality is no longer just a national goal—it’s a survival strategy for our generation. While policy exists within systems, true change always comes from people. As someone bridging administration and on-the-ground efforts, I hope to walk alongside the future climate leaders' journey of discovering innovative ways to achieve carbon neutrality.