Title: An estimation of offset supply for the Korean emissions trading scheme using the Bass diffusion model

Authors: InTaek Yoon; Sohyun Kate Yoon

Addresses: School of Earth and Environmental Sciences, Seoul National University, Seoul, Korea ' Harvard University, Cambridge, MA 02138, USA

Abstract: The purpose of this paper is to estimate the possible carbon offset supply in the Korean emissions trading scheme using the Bass diffusion model. To estimate the quantity of the likely offset supply, both a bottom-up and top-down approach were used. The forecasted supply of offsets from 2015 to 2020, for non-covered companies in the industrial sectors, is approximately 12.60 million tCO₂e. For a realistic estimation, scenario-based analysis on the marginal abatement costs for each project type and sector has been conducted. Five offset project scenarios (6,000; 12,000; 20,000; 33.000; and 100,000 Korean Won/tCO₂e) have been selected. It is estimated that there will be 2.44~3.43 million tCO₂e of offsets available until 2020. This analysis forecasts a significant shortage of domestic offsets in ETS periods if no additional offset programs or methodologies are allowed.

Keywords: carbon offset; Korean emissions trading scheme; ETS; Bass diffusion model; marginal abatement cost; offset supply; Korea.

DOI: 10.1504/IJGW.2017.084017

International Journal of Global Warming, 2017 Vol.12 No.1, pp.99 - 115

Received: 20 Feb 2015
Accepted: 24 Jun 2015
Published online: 03 May 2017 *

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