New subsidies for green machines mapped out

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New subsidies for green machines mapped out

The government will introduce a measure next year to subsidize cars with low carbon dioxide emissions while penalizing big polluters to encourage the development of environmentally friendly vehicles.

According to the Ministry of Environment yesterday, buyers of vehicles that emit carbon dioxide of 130 grams per kilometer of driving (209 grams per mile) or lower will be subject to state subsidies of up to 3 million won ($2,550).

Kia Motors’ subcompact Morning and Hyundai Motor’s Avante compact belong to its category. However, consumers who buy Hyundai’s flagship luxury sedan Equus, Santa Fe SUV or Sonata midsize sedan - each of which discharges at least 141 grams of carbon dioxide per kilometer - will have to pay more of up to 1.5 million won.

The ministry refers to this as its carbon dioxide cooperation fund system.

Park Cheon-gyu, a senior official at the ministry, said pollution and wasted energy are chronic problems as midsize and large cars account for 81.9 percent of all passenger cars registered in the country.

Park said the ministry hopes to change people’s buying patterns to lower the country’s carbon footprint.

According to the government, vehicles with emissions of between 131 grams and 140 grams per kilometer are classified as neutral and will neither receive subsidies nor be subject to penalties.

However, the details may be adjusted later following a trial-by-fire.

“After hearing various forms of feedback, both the emissions table and the amounts may be amended,” a ministry official said. There will be some grace periods to help the auto industry and market adjust, she added.

According to the ministry, Korea discharged the sixth-largest amount of carbon dioxide among OECD nations in 2010. Its emissions also outgrew those of other members that year.

The nation’s transportation sector produced 98 million tons of carbon dioxide, or 17 percent of the total. The government is targeting reductions of 34.3 percent in this area by 2020, the biggest cut among all sectors.

It aims to slash greenhouse gas emissions by a total of 30 percent from business-as-usual forecasts by 2020.

In Korea, low-emitting city cars account for just 8.9 percent of all registered passenger cars, compared to 30.6 percent in Japan, 31 percent in the U.K. and 39 percent in France.

Meanwhile, the auto industry is putting up much resistance to the new system, which it said favors foreign and especially German automakers, known for their low-emission diesel cars.

“This is not something that should be dealt with by the Environment Ministry alone. Along with the carbon tax issue, it needs to be jointly handled by the Ministry of Strategy and Finance and the Ministry of Public Administration and Security,” a Korea Automobile Manufacturers Association official said.

By Limb Jae-un []
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