Making Waves: The international impacts and opportunities of the EU’s carbon market for shipping

This study examines the impact of the EU’s Emissions Trading System (ETS) to global shipping. We demonstrate that the ETS has limited negative impact on Small Island Developing States (SIDS) and Least Developed Countries (LDCs) and could in fact be a net gain to those countries if the EU extends its carbon pricing mechanism to all ships calling at European ports, then distributes the extra revenues in the form of climate finance. 

Finally, the study proposes a novel concept, ‘ETS-as-a-service’, as a means for neighbouring countries to generate revenue and decarbonise their own shipping emissions.