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Carbon neutrality, declared by the president in a municipal speech last October, has become the most important energy issue now. There are negative interpretations that it was unavoidable for us as well, as Europe, the United States, Japan and China declared carbon neutral first, but large domestic companies are vigorously declaring carbon neutral, creating new departments and expanding investment. For example, in early December of last year, POSCO declared 2050 carbon neutral based on hydrogen reduction steel.
The government organized a forum with experts and stakeholders from all walks of life in 2019 to work on the recommendations for the Long Term Low Carbon Development Strategy (LEDS) 2050. Although carbon neutrality in 2050 was not technically impossible, it was ultimately not adopted due to the consensus of forum members that it would cost too much. However, given that the final draft of the LEDS presented by the government to the United Nations in December last year contained carbon neutrality, many people, including the author who participated in the forum, are surprised.
Now, we need to create a carbon neutral path that will reduce greenhouse gas emissions to zero in 2019 of around 700 million tonnes by 2050. Furthermore, it is necessary to clarify the level of costs and who will pay our society to carry out the determined path. The cost will be incurred largely in two aspects: cost of damages and cost of execution. First, there are sectors in which jobs are increasing due to carbon neutrality, but there are sectors in which jobs are further reduced, which can result in damage costs of considerable scale.
The Industry Research Institute predicted that production will decline by as much as 44% and jobs by as much as 1.34 million in the manufacturing sector due to carbon neutrality in 2050. For example, expanding the spread of vehicles Electric vehicles would increase the use of batteries, electric vehicle parts and manufacturers, but could further reduce employment in the oil refinery and parts and manufacturers of internal combustion locomotives. Some point out that in the case of car manufacturing, 60% of production workers will disappear from 2030.
Second, to practice carbon neutrality, a considerable amount of implementation costs are also required to develop and commercialize low-carbon technologies and to expand the diffusion of low-carbon media. Consequently, the government announced that it would consider introducing a carbon tax while reorganizing the system of taxes and levies. However, the issue of double taxation may arise because the individual consumption tax, the environment tax, transport energy, etc., on behalf of the environmental tax, which are similar to the carbon tax, are already being applied. to fossil fuels on a considerable scale. . Therefore, a sophisticated carbon tax design is required. In addition, as the use of fossil fuels must be reduced to promote carbon neutrality, the tax revenues levied on fossil fuels will be reduced considerably. Finally, the tax rate applied to fossil fuels must be raised to ensure tax revenue. However, it is questionable whether our society is willing to accept it. In other words, it is necessary to start a discussion about how many damage costs are incurred for carbon neutrality, how many execution costs are required, and how to prepare financial resources for damage compensation and execution.
Instead of talking about a promising future in which carbon neutrality will create jobs if carbon neutrality is to be practiced properly, it is necessary to talk about the size of the costs that our society has to bear and share the results with it. public. In addition, a social consensus must be achieved through discussions on the burden of costs, and compensation and support measures must be prepared for damages to industries and personnel that are expelled in the carbon neutral process.
In particular, taxes and levies on behalf of environmental taxes collected in traditional sectors such as steel, petrochemicals, cement, oil refining, automobiles, and urban gas should be used to induce the conversion of processes or industries to carbon neutrality in the sector and to provide a social safety net. For example, the oil tax should be used for carbon neutrality in the refining and automotive sectors, and the current method of using it as a subsidy for the purchase of imported electric vehicles should be avoided. It is hoped that carbon neutrality can be adequately promoted on the basis of national consensus and sound institutions.
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