Unlocking Solutions: The Social Benefits of Reducing Methane Emissions from South Korea’s Energy Imports
research 2025-07-30
Methane Report

Unlocking Solutions: The Social Benefits of Reducing Methane Emissions from South Korea’s Energy Imports

About

As one of the world’s top five fossil fuel importers, South Korea plays a major role in driving global demand for coal, oil, and gas. However, while the country accounts for domestic emissions from fuel use, it has yet to fully address a critical blind spot: methane emissions released during fossil fuel production in exporting countries.

Methane is an extremely potent greenhouse gas—up to 80 times more powerful than carbon dioxide. In 2023, fossil fuels imported to Korea were linked to 46.72 million tons CO₂e in upstream methane emissions—roughly ten times more than methane emissions from Korea’s domestic energy use.

This report by Solutions for Our Climate (SFOC) examines the economic, environmental, public health, and diplomatic benefits that South Korea could realize by introducing policies to reduce methane from fossil fuel imports.

Executive summary


Policy Context

Methane import standards—such as those recently introduced by the European Union—are designed to reduce methane emissions beyond a country’s borders. These policies regulate emissions tied to the production and transport of fossil fuels before they reach the importer.

For countries like South Korea, which imports 98% of its fossil fuels, this kind of regulation could be transformative. The report outlines four policy approaches:

  • Information-based: Requires exporters to monitor, report, and verify methane emissions (MRV)

  • Prescriptive: Mandates the use of specific methane reduction technologies

  • Performance-based: Sets limits on methane intensity of imported fuels

  • Market-based: Applies fees or penalties for excessive methane emissions

These policy options were closely examined in a previous joint study by SFOC and Carbon Limits, which assessed their feasibility and potential effectiveness in the Korean context. Read more here.



Why It Matters

Implementing methane standards for imports would directly support South Korea’s climate commitments—including its 2030 NDC and 2050 carbon neutrality target—while also strengthening its global leadership under the Global Methane Pledge, which aims for a 30% reduction in methane emissions by 2030.

Moreover, methane reduction has multiple co-benefits: it improves air quality, lowers premature mortality from pollution, and reduces near-term warming—buying time to scale long-term climate solutions. Early action can also position Korea as a standard-setter in methane governance and unlock new economic opportunities, including technology exports and cleaner energy trade.

Importantly, the benefits of methane reduction are global in nature and can be realized relatively quickly due to methane’s short atmospheric lifetime (about 12 years). By avoiding future climate damages—especially in vulnerable regions—these reductions deliver measurable economic and social gains. This report applies the concept of the Social Cost of Carbon (SCC) to quantify how much damage can be avoided under different methane reduction scenarios.

Figure 1. Relationship Between Damage Costs and Benefits

Key findings

  1. Global climate benefits could exceed USD 160 billion.
    Methane regulation on Korea’s coal, oil, and gas imports could avoid USD 163 billion (KRW 200 trillion) in global climate damage by 2100 under a 1.5°C scenario. Under a 2°C scenario, benefits remain substantial at USD 140 billion.

  2. Domestic benefits estimated at USD 1.5 billion
    Even though Korea doesn’t produce most of its fossil fuels, it stands to gain from avoided domestic climate damages—estimated at USD 1.5 billion (KRW 1.7 trillion) by 2100 under the 1.5°C scenario.

  3. Information-based regulation offers a practical starting point
    Among various policy options, the study recommends Korea begin with an information-based approach—such as requiring methane reporting (MRV)—to lay the groundwork for more ambitious regulation. This aligns with global best practices and allows Korea to act quickly and cost-effectively while sending a strong signal to exporters.

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