External projects are projects that reduce, absorb, or eliminate greenhouse gases in a manner that meets international standards in emission facilities or emission activities outside the organizational boundaries of companies subject to the allocation of the greenhouse gas emission trading system. 

Emissions issued due to the promotion of external projects are the performance of external business certification and have the effect of 1tCO2–eq of greenhouse gas emission rights. External business certification results are sold to emission trading system allocators, etc., and companies subject to allocation who purchase emission rights can convert the purchased certification results into offset emission rights and use them to fulfill reduction obligations. 

Korean Offset Credit(KOC) 

This refers to the performance of the greenhouse gas reduction submitted by external business operators reviewed by the certification committee and confirmed by the head of each department. Unit of Korean Offset Credit : KOCs(Korean Offset Credits) 

Korean Credit Unit(KCU) 

Certification performance: When converting 1 carbon dioxide equivalent ton (tCO2-eq) into an offset emission right, it is converted into 1 offset emission right (KCU) and has the same effect as 1 allocated emission right (KAU). Unit of Korean Credit Unit : KCUs(Korean Credit Units) )

• Article 29 (Offset) of the Act On The Allocation And Trading Of Greenhouse-gas Emission Permits ·
• Article 30 (Certification of Greenhouse Gas Reductions from External Projects) of the Act On The Allocation And Trading Of Greenhouse-gas Emission Permits 
• Article 47 (Offset) of the Enforcement Decree Of The Act On The Allocation And Trading Of Greenhouse Gas Emission Permits 
• Article 48 (Feasibility Evaluation, Approval and Revocation of Approval of External Projects) of the Enforcement Decree Of The Act On The Allocation And Trading Of Greenhouse Gas Emission Permits
• Article 49 (Certification of Greenhouse Gas Reductions from External Projects and Revocation of Certification) of the Enforcement Decree Of The Act On The Allocation And Trading Of Greenhouse Gas Emission Permits 
• Article 50 (Management and Operation of Offset Register) of the Enforcement Decree Of The Act On The Allocation And Trading Of Greenhouse Gas Emission Permits 
• Guidelines for Evaluation of the feasibility of external projects and Certification of Reduction Amount 

Propulsion system

The offset credit system in Emission Trading System is operated under the management agency system for each sector, and the management agencies for each sector are as follows.

5W1H

The registration process for external projects is as follows. 

① Project identification 
Discover the project by reviewing the technology applicability, reduction potential, obstacles, expected effects, and economic analysis of the project.

② Development of project proposal
An offsetting project can be promoted at the time the contract or construction of the project begins. Data on the business plan are secured and the business plan is completed through visits to the business site and interviews with the person in charge.

③ Feasibility assessment
The competent agency of each sector evaluates whether the business plan prepared by the external business project’s operator meets the relevant standards.

④ Consultation with the Ministry of Environment 
If the feasibility evaluation results are eligible for the External Project, operators discusses with the Ministry of Environment for the evaluation results.

⑤ Certification Committee 
If the results of the Ministry of Environment’s discussion are eligible for the External Project, the agenda will be presented bringed to the Emissions Certification Committee.

⑥ Project approval
For projects that have been finally approved by the Emissions Certification Committee, the external Project approval letter can be checked through the offset register. Training for the implementation and monitoring of the project will be conducted. In addition, the external Project certification process will be started for the implementation and monitoring of the project.