Platts begins publication of Korean Allowance Unit and Korean Offset Credit Carbon Assessments

Platts, part of S&P Global Commodity Insights has started publishing new Korean Allowance Unit (KAU) and Korean Offset Credit (KOC) Carbon Markets assessments from March 1, 2023.

A proposal was published Jan. 30 and available here: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/013023-platts-proposes-launch-of-korean-allowance-unit-korean-offset-credit-carbon-assessments

The decision was published Feb. 23 and is available here: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/022323-platts-to-begin-publication-of-korean-allowance-unit-and-korean-offset-credit-carbon-assessments

Platts has launched the following two assessments:

Korea Allowance Units (KAUs)

A daily assessment for the Korean Allowance Units (KAUs) that reflects 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 is 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 will reflect KAUs vintage 2022, with retirement due before Aug. 1, 2023. On Aug. 1, 2023, Platts KAU assessment will reflect KAUs vintage 2023, with retirement due before Aug. 1, 2024.

Korea Offset Credits (KOCs)

A daily assessment for the Korean Offset Credits (KOCs) that reflects 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 is 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 reflects the KOC expiring at the end of the calendar year. For example, this means that on March 1, 2023, Platts will assess KOC 21-23, which expires at the end of 2023. On Jan. 2, 2024, the daily Platts assessment will reflect KOC 22-24.

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

For both assessments, Platts publishes to a 1 pm Korea time assessment close and a minimum lot size of five contracts, with no maximum specified. These assessments will published in line with the Platts APAC Carbon holiday calendar. Full details of the publication dates for these assessments can be found here: https://www.spglobal.com/commodityinsights/en/our-methodology/holiday

All information that is used within the price assessment each day is 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 are published in the Platts Carbon Markets Daily, on Platts Carbon Markets Alert and Energy Transition Alert, and in the Platts Pricing Database under the following codes:

Please send any further feedback to AsiaComplianceCarbon@spglobal.com, 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.