Korea unveils 1,000 trillion won green transition plan

South Korea will invest 1,000 trillion won ($744 billion) over the next decade in a state-led green transition aimed at cutting industrial emissions while building export industries, the Ministry of Climate, Energy and Environment said Wednesday.

The money covers 200 trillion won in government spending and more than 790 trillion won in climate finance arranged through five policy lenders. Private companies are to add 220 trillion won through ten flagship projects under the Korea-Green Transformation strategy, or K-GX, presented at a briefing at the Korea Chamber of Commerce and Industry in central Seoul.

The plan targets five of Korea's biggest greenhouse gas emitters — steel, petrochemicals, cement, semiconductors and displays, and refining — converting their main production processes to low-carbon operations. In steel, the government aims to demonstrate 300,000-ton hydrogen-based steelmaking by 2030 and move to commercial output, a world first.

The energy programme sets a goal of 100 gigawatts of renewable capacity by 2030 through new solar and wind sites, alongside measures to lower generation costs, expand and upgrade the grid, and foster a direct-current transmission industry. In transport, more than 70 percent of new vehicles are to be electric or hydrogen by 2035 under a revised subsidy system.

Ten green industries — electric vehicles, batteries, solar, wind, small modular reactors, power equipment, power semiconductors, heat pumps, hydrogen and carbon capture, use and storage — will receive technology development and commercialisation targets, domestic production tax credits and export support.

"We must move away from the practice of following others as a latecomer and now become the designer and leader of the green market, setting the rules ourselves," President Lee Jae-myung said at the briefing, according to the presidential office.

Climate tech startups that struggle to commercialise despite strong technology will receive support tailored to their growth stage, including research grants, test beds and packages of up to 10 billion won ($7.44 million). Regional programmes include an energy-focused model in Naju built around Korea Electric Power Corp. and the Korea Institute of Energy Technology, and a Jeju carbon-neutral model that will convert all new vehicles on the island to electric by 2035 and test heat pumps, storage and virtual power plants.

The government also plans to designate special zones for a "just transition" within the year, offering job training and incentives in areas facing major economic change, and to draw up a roadmap for converting coal plants by 2040.

To draw private capital, the government will expand its climate response fund and prepare the institutional framework for green bonds by the first half of 2027. Companies will be offered tax incentives including domestic production credits for solar, wind and battery components and a push to designate small modular reactors as national strategic technology. A joint public-private committee chaired by the finance minister will oversee implementation.