The Institute promotes the application of independent research and analysis to major economic and social issues affecting the quality of life of Canadians in all regions of the country. [...] Much of the debate leading up to ratification focused on the costs of emissions reductions and on the impact on competitiveness of the costs to the Canadian economy. [...] As well, the issue of Kyoto costs is especially important to Canadian decision makers because of the structure of the Canadian economy. [...] Because of the increases in Canada’s emissions levels since 1990, and current estimates of emissions growth between now and 2010 (the mid-point in the Kyoto target range of 2008-to-2012), the Kyoto target of 6 percent below 1990 levels for 2008-to-2012 implies emission reductions of about 30 percent from business-as-usual levels in 2010.4 These requirements illustrate that the Kyoto emissions-redu [...] In a few cases, however, the size of the expected cost shock falls in the 3 percent-to-4 percent range of output prices.12 As a result, even with the price and quantity assurances contained in federal policy, emissions reductions will lead to some level of cost shocks in the affected industries and will likely have an impact on competitiveness.