South Korea earmarks USD 7.1 bn in aid for local EV industry: South Korea will provide KRW 9.7 tn (USD 7.1 bn) in financial aid — including tax credits and loans — for local electric vehicle battery producers to rework the supply chain in accordance with US tax credit standards, Bloomberg reported. The Korean government is also trying to secure materials used in batteries — mainly graphite — from outside of China to align with the new US rules and to maintain competitiveness in the US, according to the Ministry of Trade, Industry, and Energy.

What are these rules? To reduce dependence on Chinese battery materials, the US will deem any plug-in cars made of minerals extracted from China ineligible for tax credits of up to USD 7.5k, the US Treasury said, according to Bloomberg. As consumers hesitate to purchase EVs due to high prices, these tax credits are valuable for producers. The sourcing requirements will go into effect starting 2025, but car makers will be given a two-year reprieve to gather materials. Battery makers including Samsung and LG Energy Solution have been rushing to source non-Chinese extracted graphite, while Posco Future is looking to African graphite supplies.

REMEMBER- The US has been wary of Chinese EV supply: In April, US Treasury Janet Yellen warned that Beijing was dumping excess production of solar panels, EVs, and lithium ion batteries on other countries. She said the practice “distorts global prices and production patterns and hurts American firms and workers, as well as firms and workers around the world.”

Indonesian forestry project fights to resume operations: Rimba Raya Conservation, one of the world’s largest REDD+ peat swamp forest projects, is seeking legal permission from an Indonesian court to continue operating on a 36k hectare area in Borneo, Bloomberg writes. The company filed a lawsuit against Indonesia's Ministry of Environment and Forestry after its permit for the flagship project in Central Kalimantan was revoked last year due to alleged violations of local carbon market regulations.

Rimba Raya denies wrongdoing: Rimba Raya Conservation contends that it has adhered to Indonesian regulations regarding carbon trading, including fulfilling payments to the state, according to Bloomberg. It has filed a lawsuit to challenge the Ministry's decision to revoke its permit and is seeking reimbursement for legal expenses. The Indonesian government has not commented on the matter.

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