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5. How can you possibly justify Allocating Allowances for free to Capped Facilities?

In a fair Allocation to Capped Facilities under a Hard Cap, the government is giving Allowances for free to “polluters.” However, the total number of allocated Allowances is small. The Capped Facilities as a group are under a major obligation to reduce their emissions. The cost of emission reductions is minimized by the lively market for Allowances and Offsets.


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