Seoul aims to help mobilize more than $600M in private investment while using credit policy to drive decarbonization

The South Korean government will provide $205 million (297 billion won) in new loans through a newly launched project to support 16 new corporate projects investing in facilities and R&D aimed at reducing carbon emissions, the industries ministry announced Thursday. The loan program was designed to encourage companies that proactively invest in carbon neutrality by offering long-term, low-interest financing. This follows the first round of selections earlier this year, which supported nine projects. The ministry explained that the newly selected companies plan to invest a total of $666 million (963 billion won) across various carbon-neutral fields, focusing on industrial sectors such as refining and shipbuilding and energy sectors such as hydrogen and fuel cells. 

Selected companies will receive financing at an interest rate of 1.3%, based on the government’s public fund lending rate, with a 2% discount for small and medium-sized enterprises and a 1.5% discount for large companies. Each project can receive up to 50 billion won in funding, with a maximum of 3 years of support — up to 50 billion won for facility investment and 10 billion won for R&D funding. The loan period is up to 10 years, including a three-year grace period and seven years of equal principal and interest repayment. The newly selected projects include major industrial and energy companies such as S-OIL (refining facilities), Hanwha Ocean Ecotech (shipbuilding facilities), HD Hydrogen (fuel cells, facilities and R&D), SK Plug Hyverse (hydrogen storage facilities), and Daesung Metal (nonferrous metals, facilities and R&D). Smaller and mid-sized innovators in eco-friendly vehicles and next-generation solar were also selected.

The South Korean government will provide $205 million (297 billion won) in new loans through a newly launched project to support 16 new corporate projects investing in facilities and R&D aimed at reducing carbon emissions, the industries ministry announced Thursday. The loan program was designed to encourage companies that proactively invest in carbon neutrality by offering long-term, low-interest financing. This follows the first round of selections earlier this year, which supported nine projects. The ministry explained that the newly selected companies plan to invest a total of $666 million (963 billion won) across various carbon-neutral fields, focusing on industrial sectors such as refining and shipbuilding and energy sectors such as hydrogen and fuel cells. 

Selected companies will receive financing at an interest rate of 1.3%, based on the government’s public fund lending rate, with a 2% discount for small and medium-sized enterprises and a 1.5% discount for large companies. Each project can receive up to 50 billion won in funding, with a maximum of 3 years of support — up to 50 billion won for facility investment and 10 billion won for R&D funding. The loan period is up to 10 years, including a three-year grace period and seven years of equal principal and interest repayment. The newly selected projects include major industrial and energy companies such as S-OIL (refining facilities), Hanwha Ocean Ecotech (shipbuilding facilities), HD Hydrogen (fuel cells, facilities and R&D), SK Plug Hyverse (hydrogen storage facilities), and Daesung Metal (nonferrous metals, facilities and R&D). Smaller and mid-sized innovators in eco-friendly vehicles and next-generation solar were also selected.

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