Wheatland filed a PMS allegation in the Korean Pipe review today. Wheatland’s PMS theory is quite different than before. Specifically, they are arguing that a PMS exists that affects standard pipe costs in Korea because of a combination of four factors:
(1) Government ownership and support for the electricity sector that insulates Korean electricity producers from the incentive to transition to cleaner sources of power;
(2) The failure of Korean steel producers to invest in cleaner production technologies, including converting capacity from more emissions-intensive blast furnaces to cleaner electric arc furnaces;
(3) The provision of 100 percent free allowances to Korean steel producers to protect them from the costs of complying with Korea’s emission trading system (allowances that DOC has already found confer countervailable subsidies on Korean steel producers); and
(4) Korea’s high reliance on imports of hot-rolled coil (the primary input into the production of CWP) from some of the most emissions-intensive steel industries on the planet with no offsetting measures to place a price on the carbon embedded in those imports.
They argue that to account for this new PMS, DOC should require respondents to report the emissions associated with the STD Pipe that they produced during the POR, including emissions associated with the production of STD Pipe itself as well as upstream inputs, primarily HRC. They then propose that DOC increase respondents’ cost of production per ton by an amount equal to the per-ton volume of emissions reported by respondents multiplied by a carbon price. Wheatland contends that the carbon price should be one that is sufficient to meet the Paris Agreement’s net zero emissions target by 2050, and argue that the IMF estimates that a minimum carbon tax of at least $75 per ton of emissions is necessary to meet this goal.
