The European Green Deal from the European Commission in 2019 set a high aim: that EU will become climate neutral by 2050. As a part of this, the European Commission proposed that the EU Emission Trading System (ETS), is extended to include the maritime sector. This report assesses different design features of shipping in ETS, analyse the impact on the shipping industry and the environment. The report investigates what impacts the inclusion of shipping may have on incentives for abatement, what types of emission reductions may follow, if the policy will lead to modal shifts or carbon leakage (meaning that vessels avoid EU ports in order to evade the policy) and what attitudes and expectations can be found among Swedish shipping lines and transport customers. Including shipping in EU ETS is an important decarbonization policy. We find that inclusion of shipping in the EU ETS would be instrumental in creating incentives that stimulate investments in carbon abatement technologies. However, the large variation of the carbon prices over years creates additional risks in this respect. Besides the internal factors (such as setting the level of the emissions cap) that has an impact on price, there are external factors (such as reduced emissions in other sectors) that could result in reduced carbon prices and, consequently lower incentives for investments in green technologies and fuels.