This report designs a global cap-and-trade scheme for maritime transport and assesses its impacts on the shipping sector, regions and groups of countries.
It shows that it is feasible to implement a cap-and-trade scheme for greenhouse gas emissions in the maritime transport sector. Such a scheme ensures that the environmental target is met, while allowing the sector to grow and ensuring that the target is met in the most cost-effective way. An emissions trading scheme would result in an increase in the costs of shipping of less than 10%, depending on the price of allowances. The increase in import values is likely to be less than 1% for most commodity groups, and the impact on consumer prices even lower.
Using new data on emissions of ships sailing to regions and country groups, this report demonstrates that the additional costs of imports for most regions and country groups are estimated to be less than 0.2% of GDP, with a few exceptions.
This report demonstrates that it is possible to compensate developing countries for the increased costs of imports by using approximately two thirds of the revenues of the auction. The remainder of the revenues can be used for other aims, such as R&D into fuel-efficiency of ships.
The study has been written by a consortium comprising CE Delft, DLR and Fearnley Consultants.