We compare impacts of different CO_2 abatement mechanisms using a CGE model. Focus is on the way the tradable permits are initially distributed for emissions trading, namely auction and grandfathering. For three major energy consuming industries (basic chemical, iron & steel and electricity) in Korea, emissions trading is clearly superior to individual CO_2 abatement, but auction and grandfathering show somewhat different patterns of impact. We show that depending on how the government uses the revenue from permit auction, auction may be preferable to grandfathering.