<p>International aviation and ocean shipping are significant and potentially fast growing sources of greenhouse gas emissions. Both sectors also contribute to poor local and regional air quality. This thesis analyzes three interventions aimed at reducing air emissions from airplanes and ships. The first is the use of tugs, or an electric motor embedded in the landing gear, to propel the aircraft on the ground. If airlines were to tow all large narrowbody aircraft on domestic service from the gate to the edge of the runway before take off at 41 of the 50 busiest airports in the U.S., CO2 emissions would fall by 0.5 million tonnes annually. In addition, the switch would produce 150millioninannualairqualitybenefitsfromreducedemissionsofparticulatematter,hydrocarbonsandtheoxidesofnitrogen.UsingembeddedelectricmotorstotaxilargenarrowbodyaircraftwouldcutCO2emissionsbynearly2milliontonnesperyear.Thesecondinterventionisthemarketbasedmechanism,designedtocapCO2emissionsfrominternationalaviationat2020levels,currentlybeingdesignedatICAO.Ananalysisofanearlydraftofthismechanismsuggeststhatitwouldrequireairlinestooffsetanaverageof270milliontonnesinCO2emissionsduringeachoftheyearsbetween2021and2035whenitwillbeactive.Theanalysissuggeststhatthecurrentproposaliscomplex,andpoorlyspecified.Werecommendthatthemechanismbemademuchsimpler:forexample,bysimplydetermininganairline’soffsetobligationsonthebasisofitscarbonfootprintinthatyear.Finally,westudythecostsandbenefitsofamorewidespreaduseofgridelectricitytoenergizeberthedvessels.Weusemixed−integerlinearprogrammingtoidentifycombinationsofportsandvesselswhereusingshorepowerwouldproducethegreatestbenefittosociety.WeconcludethatthepracticecouldreduceCO2emissionsby0.2milliontonnesperyearandyieldairqualityimprovementsworth80-200 million per year at no net cost to society.</p