• Environmental and Resource Economics Review
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• v.29 no.2
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• pp.219-246
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• 2020

From the Phase II (2018~2020) of K-ETS, the offset credit from 'CDM projects that domestic companies and others have carried out in foreign countries' can be used in the K-ETS. As a result, stakeholders in the K-ETS market are actively developing overseas CDM projects, such as the 'high-efficiency cook stove project'. which can secure a large amount of credits while marginal cost is relatively low. This paper develops the investment decision-making model of offset project for the 'high-efficiency cook stove project' using the real option approach. Under the uncertainty of the emission allowance price, the optimal investment threshold (p^⁎) is derived and sensitivity analysis is conducted. As a result, in the standard scenario (PoA-S), the optimal investment threshold is 29,054won/ton, which is lower than the stock price (p^⁎_spot). However, allocation entities are not only economics in the CDM project, but also CDM risk factors such as non-renewable biomass ratio, cook stove replacement ratio, equity ratio with host country, investment period and submission limitation of emission allowance. In addition, offset project developers will be able to derive the optimal investment threshold for each business stage and use it for economic feasibility checks.

• Journal of Korean Society of Forest Science
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• v.103 no.3
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• pp.439-445
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• 2014

In this study, we developed a dynamic stand yield model to estimate the baseline carbon stock, which is essentially required for a forest carbon offset project based on forest management. For developing the yield model, the data was acquired from the databases of the $5^{th}$ National Forest Inventory. The model was validated by comparing its estimations with field measurements that were conducted from 4 study sites (14 plots with thinning treatments) located in Hong-chun, Hoeng-sung, Yang-yang Daechi and Yang-yang Jungja. The difference between the estimations and the field measurements was less than 5%. Using the dynamic stand yield model, we estimated the changes in stand yield volume and carbon stocks for each species according to the baseline scenarios. As the results, we found that baseline carbon stock was the highest at Quercus acutissima stand (83.01tC/ha), while the lowest at Pinus rigida stand (32.17tC/ha) and Pinus densiflora stand of central region (39.09tC/ha). Hence, a project provider could get more carbon emission credits from an improved forest management project when considering the project with Pinus rigida stand or Pinus densiflora stand (central region). The baseline carbon stock and the dynamic stand yield model developed from this study would be useful for designing carbon offset projects based on improved forest management.

• Journal of Korean Society of Forest Science
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• v.100 no.4
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• pp.548-557
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• 2011

REDD is recognized as a cost-effective and the most appropriate way of managing global GHG emissions. It is negotiated in a global context under the UNFCCC. The main issues of the REDD mechanism are divided into two parts: 1) developing forest carbon verification and measurement system for reducing emissions from deforestation and forest degradation, 2) establishing an appropriate system of incentives for developing countries. REDD can provide stability in carbon offset credits. However, the most important task is to establish a clear legal framework and appropriate governance structures with relevant countries. There is a wide opportunities for Republic of Korea to take a lead in cutting off greenhouse gasses in the Post-Kyoto period.

• Environmental and Resource Economics Review
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• v.23 no.2
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• pp.157-185
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• 2014

The Kyoto Protocol has extended its life until 2020 by the decision at COP18 in Doha, Qatar in 2012. So has the Kyoto Mechanism of CDM, JI, and ETS. Nonetheless, the sustainability of CDM projects is jeopardized by the recent rule changes in the international emissions trade market such as EU ETS and the price decrease in emission credits. In particular, the domestic CDM projects reducing non-$CO_2$ GHG emissions are being directly affected. This study examines the trend of carbon credit price change in the international market. It also examines how the rule changes in the international emissions trade market have affected domestic non-$CO_2$ CDM projects through which mechanisms. The policy implications drawn from this study is two-fold: it suggests how the government can assist the project developers in utilizing GHG emission reduction technologies and the market in promoting investment environment before the domestic ETS enters into effect in 2015; apart from possible measures within ETS, an additional measures such as bilateral carbon offset system is suggested to help the private sector reduce uncertainty in investment and increase options to choose.