[Public Voices] Avoiding the Pitfalls of Range-Based NDC Targets

Seungwan Kim, CEO of Next Corporation
A System Where "The Closer to the Upper Bound, the Greater the Reward" Is Needed

Seungwan Kim, CEO of Next Corporation

On November 11, the government finalized the 2035 Nationally Determined Contribution (NDC) target through a Cabinet meeting, setting it at a 53-61% reduction in greenhouse gas emissions compared to 2018 levels. Numerically, this is higher than the 2030 target of 40%, but in terms of direction, it represents a step backward. The government classified the 53% as the "substantive target linked to regulations such as the Emissions Trading Scheme," while the 61% was described as a "declarative target, premised on expanded support and technological innovation." The lower bound remains a "realistic limit," while the upper bound is left as "rhetoric without commitment."

Regarding the finalization of the NDC, the government explained that it "comprehensively considered the urgency of responding to the climate crisis, the Constitutional Court's decision, recommendations from the Intergovernmental Panel on Climate Change (IPCC) under the United Nations, and the conditions of the industrial sector." However, the decisive factor for setting the lower bound was the burden on industry. This was not a "balanced consideration," but rather the result of political compromise, turning what should be a science-based climate target into a negotiated goal based on interest adjustment.

Last year, the Constitutional Court ruled that "future generations are more exposed to the impacts of the climate crisis but cannot participate in current democratic processes," and therefore, the government must carefully establish a long-term reduction pathway. The NDC is not merely a declaration; it is a constitutional obligation that the government must uphold. This year, the International Court of Justice also stated that "the discretion of states in setting NDCs is limited to levels that make achieving the 1.5-degree target possible." Nevertheless, the government set the lower bound based on "industrial conditions" rather than scientific evidence, once again incentivizing the avoidance of short-term reduction burdens as pointed out by the Constitutional Court.

This approach is not beneficial to industry either. The government’s proposed reduction rate for the industrial sector by 2035 is 24.3%, which is significantly lower than that of Japan and Germany, countries with similar manufacturing sector proportions. The industry’s claim that "it is difficult due to our industrial structure" is, in effect, a declaration of abandoning technological innovation. The global decarbonization race has already shifted to an industry transformation competition centered on technology. A low reduction target is not about reducing short-term risks, but rather about forfeiting long-term competitiveness and opportunities to attract investment.

When the National Assembly legislates the long-term reduction pathway, it must address these issues and thoroughly consider the possibility of raising the industrial reduction target. A range-based target system creates perverse incentives in administrative practice. To minimize risk, the government and industry base their response plans on the more achievable lower bound. Ultimately, the "53% reduction" becomes the de facto target, while the upper bound (61%) remains a "meaningless ornament." There is a high likelihood that this will degenerate into a "signal that only the lower bound needs to be met" or a "minimum achievement target."

If Korea is to achieve real growth through the NDC, it must set fiscal investment and research and development (R&D) targets based on the upper bound, and introduce an incentive system for overachievement. The structure must shift from "it is enough to meet the minimum" to "the closer to the upper bound, the greater the reward." This is the starting point for institutional innovation that ensures both legal responsibility and policy credibility. The 2035 NDC should not simply be the confirmation of a target, but an opportunity to reset national climate policy.

The NDC must not remain solely an environmental policy. Climate policy should become a platform for technological innovation, industrial transformation, and the creation of new markets, requiring a collaborative planning process between the public and private sectors and the design of performance-linked systems. We must establish a system in which the responsibility required by the Constitution, the contributions expected by the international community, and the signals needed by the market all function together.

What is needed now is not an adjustment of numbers, but institutional innovation and the restoration of responsibility. With a lower-bound NDC, neither the 1.5-degree target, the sustainability of industry, nor new growth opportunities can be achieved. The government must not remain in a politically safe zone, but must return to the position demanded by the Constitution and science. That is the only way for Korea to survive in the global race for transformation.

Seungwan Kim, CEO of Next Corporation