Proposing a Global Emissions Trading Scheme: The Inclusion of Aviation and Shipping

Abstract

There are difficulties when it comes to developing a single global carbon market with comprehensive coverage of economic sectors and countries. A promising intermediary step between the creation of a global carbon market with comprehensive coverage of economic sectors and countries and the current situation, therefore, could be a sectoral approach to emissions trading. Unilateral, bilateral, plurilateral, or regional arrangements could target greenhouse gas (GHG) emissions reductions in specific sectors such as electricity generation, motor vehicles, aviation, shipping, cement and aluminium, always aiming for greener or more efficient technology, as opposed to simply applying bans or restrictions. Such measures will require across-the-board cooperation.

Keywords: Global Emissions Trading Scheme; Aviation; Shipping

JEL Classification: K33