What Changes in the 4th ETS
Korea's 4th ETS planning period (2026–2030) launches in January 2026.
Key Changes
1. Paid allocation ratio: 3rd period 10% → 4th period 15–20% by sector
2. BM allocation sectors: Steel/cement/refining → 12 sectors (adding petrochemicals, paper, glass, food, etc.)
3. External offset credit limit: 5% → 10% of allocated allowances
Understanding BM Allocation
```
Allocated allowances (tCO₂) = Activity data × BM value × Allocation coefficient
```
Less efficient companies face allowance shortfalls costing hundreds of millions of KRW annually.
4-Step SME Carbon Response Strategy
Step 1: Improve Emissions Reporting Accuracy
Step 2: Invest in Emission Efficiency
Step 3: Proactively Secure KOC Credits
Step 4: Manage Allowance Portfolio
KITIM Consulting
KITIM provides emissions statement review, BM allocation simulation, and GHG reduction roadmap services. Contact us for a free carbon risk diagnostic.