Nicosia, Cyprus. Cyprus is estimated to receive €73 million a year in national carbon-market revenue linked to shipping under the EU Emissions Trading System, according to a study by the European Community Shipowners’ Associations. The study said substantially larger sums would go to countries with smaller maritime industries under the current distribution formula.
ECSA revenue estimates
ECSA estimated that shipping would contribute around €9 billion annually to EU and national revenues if carbon allowances average €100 per tonne. Under a lower-price scenario of €85, the sector’s contribution would still reach €7.65 billion.
Of the €9 billion total, about €7.7 billion would go to national governments, while the rest would be directed to EU-level financing mechanisms, including the Innovation and Modernisation funds. At €85 per allowance, national revenues would fall to around €6.6 billion.
Distribution formula
The study said the revenue is not distributed according to the size of each country’s merchant fleet, port activity or wider shipping industry. Instead, most national auction revenue is allocated through an EU distribution formula based largely on historical emissions from stationary industries.
Under the €100 scenario, Germany would be the largest beneficiary, receiving an estimated €1.67 billion annually. Poland would receive €972 million, Italy €787 million and Spain €712 million.
Cyprus and other countries
Landlocked Czechia is projected to receive €376 million, more than the combined €229 million allocated to Cyprus, Malta and Denmark. Cyprus’ estimated share stands at €73 million, compared with €52 million for Malta and €104 million for Denmark.
Under the €85 scenario, Cyprus would receive around €62 million, while Germany’s share would fall to €1.42 billion and Czechia’s to €319 million.
Nature of the estimates
The ECSA report said these figures are estimates of the additional national auction revenue associated with the inclusion of shipping in the EU ETS and are not direct payments from shipping companies to individual governments.
Shipping companies buy allowances through auctions or the secondary market, while auction proceeds are distributed separately among national governments and EU funds. The report said a country administering a large number of shipping companies does not necessarily receive the money paid by those companies.
Instead, governments receive a share of the wider ETS auction pool, meaning there is no directly traceable stream of shipping-related revenue flowing into a particular national treasury. ECSA described its country estimates as an illustrative proxy rather than exact accounting, as the European Commission’s detailed auction methodology is not publicly available.