Platts proposes launch of Korean Allowance Unit, Korean Offset Credit Carbon Assessments

Platts, part of S&P Global Commodity Insights, is proposing the launch of new Korean Allowance Unit and Korean Offset Credit Carbon Markets assessments from March 1, 2023.

The launch of these new assessments would extend Platts coverage of the growing emissions markets ecosystem.

Platts is proposing to launch the following two assessments:

Korea Allowance Units (KAUs)

A daily assessment for the Korean Allowance Units (KAUs) would reflect the most competitively priced bids, offers and trades for current year, with the annual roll on the first working day of August, in line with the rules set out by the South Korean Ministry of the Environment. The Platts KAU assessment would be published in Won/mtCO2e, where one KAU, when retired, allows for the emission of one metric ton of carbon dioxide or equivalent.

This means, for example, that on March 10, 2023, Platts KAU assessment would reflect KAUs vintage 2022, with retirement due before Aug. 1, 2023. On Aug. 1, 2023, Platts KAU assessment would reflect KAUs vintage 2023, with retirement due before Aug. 1, 2024.

Korea Offset Credits (KOCs)

A daily assessment for the Korean Offset Credits (KOCs) would reflect the most competitively priced bids, offers and trades for both domestic and international offset credits in line with the rules set out by South Korean Ministry of the Environment. The unit of assessment will be Won/mtCO2e, where one KOC, when retired, offsets the emission of one ton of carbon-dioxide or equivalent.

KOCs are Clean Development Mechanism (CDM) or Paris Agreement-compliant and reflect rolling three-year vintages, with each KOC expiring on the last working day of the calendar year. The daily Platts assessment would reflect the KOC expiring at the end of the calendar year. For example, this means that on March 1, 2023, Platts would assess KOC21-23, which expires at the end of 2023. On Jan. 2, 2024, the daily Platts assessment would reflect KOC22-24.

These offset credits should be CDM or Paris Agreement compliant, in line with existing South Korean government regulations.

For both assessments, Platts is proposing a 1 pm South Korea Time assessment close and a minimum lot size of five contracts.

As part of its commitment to open and transparent pricing and product specifications, Platts would like to invite specific feedback on the proposed assessment close and minimum lots size for both assessments.

All information that is used within the price assessment each day will be published via Platts systems as market heards, and the source of that information is indicated as part of the heard.

Platts collects market information from a variety of sources each day, but always aims to get a balanced view of the market.

These assessments will be published in the Platts Carbon Markets Daily, on Platts Carbon Markets Alert and Energy Transition Alert, and in the Platts Pricing Database under market data category CBN.

Please send any further feedback by Feb. 15 to platts_carbon@spglobal.com and pricegroup@spglobal.com.

For written comments, please provide a clear indication if they are not intended for publication by Platts for public viewing.

Platts will consider all comments received and will make comments not marked as confidential available upon request.