The Ministry of Environment (Minister Cho Myung-rae) reported to raise the 3rd supplementary budget for this year to KRW 695.1 billion to overcome the economic slowdown from the outbreak of COVID-19 and to prepare for the post-corona era.

In the proposed supplementary budget, KRW 586.7 billion will go into investing in Green New Deal projects on low-carbon transition and green industry innovation, while KRW 17.1 billion will be used for Digital New Deal. Project on direct job creation to avoid employment cliff-edge and other projects  will be allocated with KRW 62.4 billion and KRW 28.9 billion respectively.

These projects are anticipated to create additional 17,000 jobs (including direct job creation of 12,985).

The 3rd supplementary budget compilation will have a greater job creation effect that would help overcome the economic downturn caused by climate environmental risks and the COVID-19 pandemic. Those projects that can immediately commence in the second half of this year will be the first to be allocated. Also noteworthy is that this supplementary budget is drawn for the projects that support the real economy and that utilizes information and communication technology (ICT). 

Thus, with the compiled 3rd supplementary budget as a driver towards green transition, our society and economy are expected to become more environmental and less carbon-intensive.

[Key details]

① [Transition to low carbon economy] Reducing GHG and increasing new and renewable energy generation

Distribution volumes for electric trucks (1 ton) and electric motorcycle will be increased by two-fold.

This would facilitate the transition into lower-carbon transportation of diesel trucks that accounts around 53.4% of total fine dust emissions from vehicle transportation, and of motorcycle that emits relatively larger volume of air pollutants.

The project is expected to bring about an economic turnaround to the livelihoods for especially  the small- and medium-sized business owners, the self-employed, delivery agencies, etc.

        ※ Electric truck distribution: + KRW 99 billion, +5,500 units

        ※ E-motorcycle distribution: + KRW 11.5 billion, +10,000 units

In the meantime, a pilot project will be carried out to encourage hydrothermal energy use. This project is for public organizations to use hydrothermal energy generated by river discharged water while reducing total energy use.

Based on how the pilot project fares, the Ministry plans to expand the application of best practices of energy supply low-carbon transition.

        ※ Hydrothermal energy pilot project (new): + KRW 2 billion

        ※  Research and development on hydrothermal heating/cooling and recovery heat hybrid system (new): + KRW 1 billion

As part of the new and renewable energy projects, renewable energy equipment will be further installed for 5,200 treatment facilities including water purification plants and sewage treatment plants.

These newly installed equipment will have be able to generate energy to an amount that a public sewage treatment facility with the capacity of 20,000 ton/day can use for up to a year.

        ※ Establishing new and renewable energy generation system at environment treatment facilities: + KRE 10 billion

② [Green Industry Innovation] Fostering the growth of green companies and establishing an ecosystem for green technological innovation

Additionally, regional clusters for 5 key areas with a potential to lead global green industry and market will be designated. These clusters are expected to drive a virtuous cycle of 「technology advancement → entering overseas market → creating sustainable jobs.」 

Each cluster will house R&D center, test-bed sites and back office, which by benefiting from the regional infrastructure, will provide favorable conditions to promote green industry. 

        ※ Clean air industrial cluster (new): + KRW 2 billion

        ※ Plant material cluster (new): + KRW 1.6 billion

        ※ Hydrothermal energy convergence and integration cluster (new): + KRW 1.2 billion

        ※ Resource circulation of used battery of electric vehicle cluster (new) : + KRW 500 million

        ※ Resource circulation cluster (new): + KRW 500 million

The project targets green start-ups so that they can commercialize their innovative ideas into concrete technology and products. It also aims to foster enterprises with high growth potentials by providing customized supports on from research development to commercialization so as to advance themselves as global companies.

        ※ Supporting the growth of green innovative companies (new): + KRW 15 billion

        ※ Fostering eco-startups cluster (new): + KRW 6 billion

        ※ Research and Development of promising green industry technological innovation (new): + KRW 5.3 billion

In addition, the Ministry plans to increase the budget allocated to support SMEs by 2.2 times to develop and commercialise environmental technologies to help its effective entry into the market, while newly setting aside KRW 330 billion as loans that can nurture environmental industry in the future to encourage companies' bold investment.

        ※ Supporting small- and medium-sized environmental enterprises: + KRW 36 billion

        ※  Loan for nurturing future-oriented green industry (new): + KRW 330 billion

        ※ Nurturing professionals in green convergence and technology (new): + KRW 9.4 billion

③ [Building a Climate Resilient Society] Establishing a safety net to overcome climate and environmental risks

A project on building a climate resilient society includes creating a smart wide-area waterworks that involves water intake facility (real-time water quality monitoring), water purification facility (smart treatment process), and pipeline (remote control).

This will enable digitalizing the water cycle system based on information communication technology and artificial intelligence techniques, which is expected to contribute to reducing water and energy use and enhancing climate change response capability.

        ※ Establishing smart wide-area waterworks for optimizing water and energy use (new): + KRW 15.6 billion

        ※  Research and development on smart urban water resource management : + KRW 7 billion

The projects to create future-oriented eco city (smart green city) designed to become more resilient to climate change will also be implemented.

The smart green city project claims to create a human-centered city that allows continuous water circulation, emits less carbon, and restore ecosystem. Once a masterplan that illustrates how 10 innovative technologies could be applied is set up, the project will be implemented in full swing from next year.

        ※ Developing a comprehensive plan for a smart green city (new): + KRW 1 billion 

Also included in the budget proposal is the project on smart ecosystem factory. The goal of this project is to transform manufacturing factories that emits relatively larger amount of pollutants into greener sites (minimizing pollutants, consuming renewable energy, and reusing waste resources).

        ※ Establishing smart ecosystem factories (new): + KRW 10.1 billion, 10 facilities (up to 100 facilities by 2022)

④ [Others] Expanding direct job creation, digitalizing environment monitoring, and supporting SMEs

The Ministry also plans for projects that significantly expand employment opportunities in the environment sector to create about 13,000 new jobs, including for preventing the spread of African Swine Fever (ASF) and its damages, selecting/categorizing recycled wastes, and improving the quality of recycled wastes.

        ※ Protection and management of wildlife (handling ASF cases) : + KRW 8.1 billion, +744 people/jobs

        ※ Improving disposal sites conditions especially in the regions with poor waste-separation facility (improving recycled products quality): + KRW 42.2 billion,  +10,843 people/jobs

On the other hand, a project is planned to be carried out to digitalize the measurement and monitoring system of environment pollution, using advanced technology such as Internet of Things and ICT (information and communication technology).

        ※ Establishing air pollutants monitoring system using environment satellites: + KRW 14.1 billion

        ※ Installing automatic collectors of samples with malodor (new): + KRW 3 billion

At the same time, the Ministry proposed to increase the budget assigned for SMEs to support their implementation of chemicals rules. The allocated budget will be spend on supporting the entire cycle of production, registration and approval of harmful testing materials.

        ※ Supporting small- and medium-sized chemical companies in complying with the Act on Registration, Evaluation, ETC. of Chemicals and Act on Safety Management of Consumer Chemical Products and Biocidal Substances : + KRW 14.8 billion

[Future plans]

The 2020 3rd supplementary budget proposal will be submitted to the National Assembly early June, which will be ed after the deliberation and approval at the National Assembly.

Environment Minister Cho said "we prioritized short-term tasks that would potentially bring about economic recovery amongst the Green New Deal strategies."

"We will carefully prepare the proposed projects so that when the supplementary budget is approved at the National Assembly, we can maximize the impact in implementing those project."