The GHG fund and the ETS: finding common ground

The shipping sector contributes with around 3.2 % to worldwide CO2-emissions and its emissions are expected to grow in the future. Two market based mechanisms have been proposed by EU countries to address the climate impacts and reflect the principle of common but differentiated responsibilities: a GHG Fund and an Emissions Trading Scheme (ETS).

This paper concludes that the differences between the two are primarily due to differences in design, and not to differences in principle. Both systems can be designed to have similar costs

to industry, including administrative costs, similar environmental effectiveness, and yield a similar amount of revenue for other purposes than offsetting shipping emissions. Differences remain

in short term price volatility.