South Korea accelerates SME R&D drive to cut aluminium and steel carbon exposure

The Ministry of SMEs and Startups, in collaboration with the Korea Technology and Information Promotion Agency for SMEs (TIPA), has announced that it will be recruiting companies to join the “2026 Carbon Reduction R&D for Core Export Items of SMEs” project. The project will take place from May 13 to 27.

The main agenda of the project is to respond to the European Union's carbon border adjustment mechanism (CBAM). Alongside this, the project also aims to address the other global carbon regulations. In order to achieve this, the project will focus on developing and demonstrating carbon-reduction technologies, especially for the export of products that are carbon-heavy, like aluminium and steel.

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CBAM adds costs which are based on the carbon emissions produced when making products that are exported to the EU. At the start of this year, the full implementation of CBAM has been completed, where major countries are either introducing or tightening similar regulations. As a result, the pressure on the SMEs, including those that are part of the supply chain, is expected to increase.

In addition to this, the project also aims towards boosting SMEs in their ability to adapt to carbon regulations while keeping their edge in exports. Alongside the development of carbon-reduction technologies, it also provides support for their application and verification in real production environments.

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Those eligible to support the consortium include:

- SMEs working on carbon-reduction technologies

- Export-oriented SMEs (two or more companies) that can implement these technologies

- Universities and research institutions that can contribute as needed

Selection will occur through a specific call for proposals, with three priority support areas:

- Replacing combustion fuels and feedstocks

- Improving unit processes and reducing power consumption

- Commercialising the reuse of raw materials and components

In total, there are 26 specific tasks that will be open for invitation.

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Via the evaluation process, the selection of eighteen tasks will be done. Each of the tasks will be supported by USD 4.1 million for the next three to five years. This initiative not only covers research and development but also includes on-site demonstrations and verification of the reduction effects.

Additionally, the entire project is set to run from this year until 2030, with a total budget of USD 73 million and among this, USD 54.5 million will come from the national budget.

For this year, USD 3.7 million has been allocated. In this, companies that are interested in participating in this project can be a part by applying online via the Integrated Research Information System (IRIS). Additional details are available at the websites of the Ministry of SMEs and Startups (MSS) and the Korea Technology and Information Promotion Agency for SMEs (TIPA).

Trading aluminium across borders? Find out the exact cost you need to bear for the embedded carbon in the product by using this CBAM calculator.