South Korea’s SK Securities Co. will jump into overseas carbon trading business by distributing high-efficient cooking stoves in Bangladesh to earn carbon credits and sell them to companies in Korea that wish to offset emissions.
SK Securities on Friday signed a memorandum of understanding with power supplier Korea Midland Power Co. and clean development mechanism services provider Ecoeye Co. to promote a carbon credit project that involves generation of certified emissions reduction (CER) units issued by the Clean Development Mechanism (CDM) executive board aimed at reducing greenhouse gases.
Under the MoU, SK Securities will supply high-efficient cooking stoves to families in Bangladesh and earn carbon credits as they will produce less carbon dioxide than traditional stoves and sell them in Korea. The brokerage will also manage registration and operations of CDM projects in the country.
SK Securities’ move to jump into the global carbon market comes after the Korean government amended the related guideline to allow Korean companies to launch greenhouse gas reduction businesses overseas to earn CER units and use them in Korea.
SK Securities expects that the latest project should help reduce greenhouse gas emissions by 2.4 million tons over the period of five years. The company also plans to submit an application to Green Climate Fund in Songdo, Incheon, in the second half of this year, to become an accredited entity that helps reduce energy.
An unnamed official from SK Securities said that the company is the first financial institution in Korea to launch overseas carbon credit business and that it plans to make up for the lack of CER units in Korea and boost market for carbon trading.
SK Securities, meanwhile, created a new green climate financial team in June last year and signed an MOU with Climate Bonds Initiative (CBI) in November to promote renewable energy projects such as carbon trading. CBI is a London-based international organization founded in 2009 that establishes standards and policies of climate bonds and certifies them.
By Ko Min-suh and Lee Eun-joo
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