Han River Water Use Charge — Statutory Upstream-Downstream Watershed PES (South Korea)

Seoul, Incheon and much of Gyeonggi-do depend on the Han River for drinking water, while upstream communities in Gangwon-do and Chungcheongbuk-do faced land-use and farming restrictions to protect water quality — creating a gap between who bears the conservation cost and who receives the water benefit.

The Han River Act, enacted in 1999, established a statutory water use charge paid by downstream and midstream users per cubic metre consumed. The rate rose from KRW 80/m³ in 1999 to KRW 170/m³ by 2012, where it remained through at least 2016. Proceeds flow into River Maintenance Funds administered through the Han River Watershed Management Committee, which purchases land in protected riparian zones, funds resident-support and agrochemical-reduction programmes across 11 upstream districts, and finances environmental infrastructure.

Cumulative River Maintenance Fund receipts across all of Korea's major river basins reached KRW 10.14 trillion by 2015, with the Han basin alone accounting for 57.1% of that total (roughly KRW 5.79 trillion). In one recent year cited in the literature, Gyeonggi-do (midstream) users paid approximately KRW 194 billion and Seoul/Incheon (downstream) users paid approximately KRW 230 billion into the fund.

Academic reviews (e.g. Kim, 2021; Water, 2017) document persistent distributional tension: downstream payers periodically push to lower the charge, upstream communities argue compensation remains inadequate relative to the opportunity cost of land-use restrictions, and overlapping regulations remain a point of dispute. The sources reviewed do not include an independent water-quality study isolating the charge's specific effect from other Han River management measures.

Read the full analysis: https://seoulsolution.kr/en/content/3575