Too TIER-ed? Alberta's Proposed Re-design of Carbon Pricing for Large Emitters

Alberta’s government proposes to replace the current Carbon Competitiveness Incentive Regulation for output-based carbon pricing of large emitters with the Technology Innovation and Emissions Reduction (TIER) system.  A submission on behalf of the C.D. Howe Institute to Alberta’s government (published as a C.D. Howe Institute Verbatim here) details concerns with TIER - specifically that imposing a facility-specific benchmark on all facilities will reduce the comparative advantage of lower emissions facilities and could distort the growth of production towards higher emissions facilities.  The submission recommends allowing facilities to opt in to a product-specific benchmark and applying a product-specific benchmark to new or significantly expanded facilities.