It is imperative for the Republic of Korea to prioritize the development of elaborate green transition strategies and implementation plans. In light of this urgency, this study offers ten chapters addressing select issues on green transition, which provide policy recommendations drawn from identification of problems, assessment of current policies, and empirical analysis.

Chapter 2 (Dr. Yong Hyeon Yang) assesses the national greenhouse gas emission reduction plan the Korean government announced in Oct. 2021. It finds the sectoral strategies to be insufficient for the stated targets and suggests that an energy transition ambition has to be increased as either targets have to be decreased in other sectors or there could be a need for more extensive electrification. Chapter 3 (Prof. Wonhyuk Lim) offers insights on energy transition strategies and their implication for the electricity industry. Periodical simulations should be conducted for multiple scenarios, and the overall cost of transition, including the expenses for networks and standby facilities as well as the levelized cost of energy, should be minimized. Accordingly, transition and phase-out of fossil fuel plants should be systematically planned in stages.

Chapter 4 (Dr. Yeochang Yoon) points out the limitations of the Korean emission trading system (ETS) and presents potential solutions. The current restrictions on banking need to be relaxed to keep the ETS allowance prices from dropping, but such adjustments should be introduced gradually to prevent a sudden decline in supply. Chapter 5 (Prof. Hyungna Oh) raises a possibility of insufficient investment in decarbonization technologies due to first-mover disadvantages. It advocates introduction of carbon contracts for difference to incentivize R&D in green technologies, especially when carbon prices are low or uncertain. Chapter 6 (Dr. Karam Jo) presents the empirical result that patents in some digital transformation technologies can increase patents in climate technologies by an average of 17.3% and underscores the need to promote such digital transformation technologies.

Chapter 7 (Dr. Junghyun Kwon and Dr. Joseph Han) reveals that elevated outdoor temperatures decrease working hours in an inequitable manner and deteriorate workers’ health. These observations imply that climate change could magnify income inequality. As such, protective measures for outdoor workers against high temperatures and support for their job transitions are crucial. Chapter 8 (Dr. Hyunseok Kim) proposes selective subsidies for regions heavily impacted by climate change and green transition, and highlights the necessity of assessing those impacts objectively. Most importantly, local governments should formulate transition plans in line with central government guidelines.

Chapter 9 (Prof. WooRam Park) indicates that a large portion of greenhouse gas comes from establishments with more than 300 workers, and in such industries as petrochemical and steel. It also shows higher carbon productivity in industries with lower greenhouse gas emissions and establishments using less energy. Chapter 10 (Dr. Joseph Han) reveals the empirical result that firms who entered in the first stage of ETS had significantly lower greenhouse gas emissions, energy usage, annual turnover, and employment than those who did in the second stage. The performance of these firms was influenced by the design of the ETS, for example, on what basis the allowances were assigned free of charge or for a fee. Hence, policy design for green transition should pay particular attention to its effects on businesses and employment. Lastly, Chapter 11 (Dr. Sora Chon) observes that the global green transition might trigger both green and energy inflation. Analyzing the effect of inflation factors on the Korean economy finds that such impacts vary based on whether inflation arises from a demand or a supply shock. Consequently, the Korean government's responses should differentiate between inflation factors that are demand-side and supply-side.

Preface
Executive Summary

Chapter 1 Introduction (Yong Hyeon Yang)
References

Part 1 Strategy Formulation and System Design

Chapter 2 Evaluation of Greenhouse Gas Reduction Plans and Future Directions (Yong Hyeon Yang)
　Section 1 Evaluation of the Proactivity of Reduction Targets
　Section 2 Selectable Reduction Paths and Evaluation
　Section 3 Sectoral Reduction Plans and Consistency Across Sectors
　Section 4 Conclusion
　References

Chapter 3 Challenges of the Power Industry for Low-Carbon Electrification (Wonhyuk Lim)
　Section 1 Introduction
　Section 2 Carbon Neutrality and Low-Carbon Electrification
　Section 3 Korea's Carbon Neutrality Plan: Focus on the Transition Sector
　Section 4 Future Challenges for the Power Industry in Low-Carbon Electrification
　References

Chapter 4 Measures to Improve the Operation of the Emissions Trading System (ETS) for Low-Carbon Transition (Yeochang Yoon)
　Section 1 Introduction
　Section 2 Current Status of Carbon Pricing Systems Domestically and Internationally
　Section 3 Analysis of Static Models
　Section 4 Analysis of Dynamic Models
　Section 5 Conclusion and Policy Implications
　References

Chapter 5 Latecomer Advantage and Early Commercialization of Decarbonized Process Technologies: The Necessity of Carbon Contracts for Difference (CCfD) (Hyungna Oh)
　Section 1 Introduction
　Section 2 Emissions Status of Energy-Intensive Materials Industry and Barriers to Carbon Neutrality: Focus on the Steel Industry
　Section 3 Review of Literature on Decarbonization in Industrial Sectors
　Section 4 Investment Decision Models for Decarbonized Processes and Products
　Section 5 Analysis of Investment Incentives for Early Commercialization of Decarbonized Products
　Section 6 Conclusion
　References

Chapter 6 Analysis of the Interrelationship Between Climate and Digital Technologies and Its Implications (Karam Jo)
　Section 1 Introduction
　Section 2 Review of Previous Studie
　Section 3 Empirical Analysis
　Section 4 Policy Implications
　Section 5 Conclusion
　References
　Appendix

Part 2 The Impact and Implications of Climate Change and Transition

Chapter 7 Climate Change and Economic Vulnerability: The Effects of Abnormal High Temperatures on Employment and Worker’s Health (Junghyun Kwon, Joseph Han)
　Section 1 Introduction
　Section 2 Temperature and Economic Activity
　Section 3 Temperature and Worker’s Health
　Section 4 Summary and Policy Implications
　References

Chapter 8 The Role of Central and Local Governments in a Just Transition and the Direction of Response (Hyunseok Kim)
　Section 1 Introduction
　Section 2 Current Status of Just Transition Initiatives
　Section 3 International Policy Directions for Decarbonization and Just Transition
　Section 4 Regional Vulnerability Analysis in Carbon Neutrality Efforts
　Section 5 Conclusion and Policy Implications
　References

Section 9 The Relationship Between Greenhouse Gas Emissions and Industrial Characteristics: Focus on the Manufacturing Sector (Wooram Park)
　Section 1 Introduction
　Section 2 Data
　Section 3 Empirical Analysis Results
　Section 4 Conclusion
　References
　Appendix

Chapter 10 Climate Change Responses and Job Losses: The Impact of the Emissions Trading System on Corporate Financial Performance and Employment (Joseph Han)
　Section 1 Introduction: Concerns About Climate Change Responses and Job Losses
　Section 2 The Emissions Trading System (ETS) and Previous Evaluations
　Section 3 Data
　Section 4 Empirical Models
　Section 5 Estimated Results
　Section 6 Conclusion and Policy Implications
　References

Chapter 11 Economic Impacts of the Global Low-Carbon Transition on Korea: Focus on Green Energy Inflation (Sora Chon)
　Section 1 Introduction
　Section 2 Energy and Metal Raw Materials Markets
　Section 3 Major Previous Studies
　Section 4 Model Setup and Analysis Results
　Section 5 Conclusion
　References
　Appendix

ABSTRACT