An ambitious ICE phase-out in Korea would reduce emissions and create long-term economic growth
A new report by Cambridge Econometrics for Greenpeace East Asia Seoul Office reveals an accelerated deployment of EVs, consistent with a phase-out of the sale of new ICEs by 2030, would lead to a substantial reduction in emissions, while creating jobs and long-term economic growth.
However, such a transition will require significant investment in infrastructure by a variety of actors, as well as labour market policies which support the transition, including helping those who lose their jobs in the motor vehicle industry to develop the right skills to benefit from the new opportunities created by the shift to zero carbon mobility.
Cambridge Econometrics analysed four scenarios, assessing the impact of changing Korea’s passenger car fleet on its economy.
Results show a reduction in emissions across all scenarios, including those with a pessimistic view on the carbon footprint of future electricity generation. Major reductions are also seen in NOx and PM10 emissions in the Tech 2030 and Tech 2035 phase-out scenarios.
However, a successful transition will require investment in supporting infrastructure covering residential, workplace, parking and rapid chargers, plus hydrogen refuelling stations.
There are also GDP gains to the transition.
Whilst in the short-term the cost of BEVs outweighs the cost of ICEs until the mid-2020s leading to slower GDP growth, the shift in spending away from petrol and diesel towards other (mostly domestically generated) fuels such as electricity, and in the long run away from transport altogether as EV prices continue to fall, will lead to long-term GDP growth.
The analysis also shows that TECH 2030 and TECH 2035 phase-outs would benefit employment in the service sectors, principally as a result of the lower cost of mobility associated with electric vehicles in later years compared to their ICE equivalents.
Further employment opportunities also created in electrical equipment and other manufacturing sectors, linked directly to the increased demand for electric vehicles.
Head of Environment Jon Stenning says,
The more rapidly the transition takes place, the greater the scale of change required. This presents short-term challenges, but our analysis also highlights the long-term economic opportunity, alongside the clear environmental benefits, that a transition away from combustion engine vehicles presents for Korea.
Click here to download the report.