Carbon Emission Trading Scheme in the shipping sector: drivers, challenges, and impacts

• Main Authors: Wu, Min, Li, Kevin X., Xiao, Yi, Yuen, Kum Fai
• Other Authors: School of Civil and Environmental Engineering
• Format: Article
• Language: English
• Published: 2022
• Subjects: Engineering::Environmental engineering; Carbon Trading; Carbon Reduction
• Online Access: https://hdl.handle.net/10356/162330
• Institution: Nanyang Technological University

The aim of this study is to review, identify and synthesise the drivers, challenges and impacts of implementing a Carbon ETS in the shipping sector. PRISMA is adopted to review relevant articles selected from Scopus and Web of Science databases. The review uncovers three categories of drivers, seven categories of challenges, and two categories of impacts. The drivers are (1) limitations of existing technical and operational solutions; (2) promise of market-based solutions; and (3) attitudes of stakeholders. Challenges are about (1) geographical coverage; (2) sectoral coverage; (3) free emissions quota percentage and the carbon trading price; (4) conflict between common but differentiated responsibilities and equal treatment; (5) management difficulties; (6) jurisdiction under international law; and (7) opposition from the shipping sector. Impacts are (1) environmental and economic impacts and (2) optimal abatement strategy. This study offers some implications and recommendations for relevant stakeholders on implementing carbon ETS.