| Summary: | In 2019, the Icelandic whale watching industry attracted almost 364,000 whale watchers, becoming one of the popular recreational activities in Iceland. To meet the international climate change regulations, greenhouse gas emissions need to be reduced. However, within the Icelandic tourism sector, the discussion of externalities, such as greenhouse gas emissions and air pollutants, are often overlooked, which includes diesel fuel and electricity consumption-related externalities from the whale watching industry. This study focuses on 3 major whale watching operators in Iceland: Special Tours of Reykjavík, and North Sailing and Gentle Giants of Húsavík. The economic values of externalities from diesel fueled whale watching vessels are compared with those fueled by predominantly geothermal and hydropower electricity, facilitating understanding of the social costs. From the calculation, the average marginal external costs per kWh for diesel is $0.052, and electricity is $0.0005. The average marginal external costs per trip are $190 for diesel ships, $126 for diesel RIB boats, and $0.25 for electric schooners. Assuming that all the trips have been conducted at 50% of the maximum passenger capacity, the average marginal external costs per passenger per trip are $3.64 for diesel ships, $21.00 for diesel RIB boats and $0.009 for electric schooners. If the burden of the external costs fell on the whale watching operators, then the carbon tax per liter of diesel should increase by 45.33% increasing the diesel prices by 1.5%, and electricity prices by 0.92%. On the other hand, if the burden fell entirely on the tourists, the ticket prices for the whale watchers would increase by 3.87-4.28% for diesel ships, 13.38-13.55% for RIB boats, and 0.01% for electric schooners. Árið 2019 laðaði hvalaskoðunariðnaðurinn á Íslandi 364,000 viðskiptavini sem gerir hvalaskoðun eina af vinsælustu greinum ferðaþjónustu á Íslandi. Til að mæta alþjóðlegum skuldbindingum þarf að minnka losun gróðurhúsalofttegunda. Umræða um úthrif, svo sem ...
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