There's more than one way to create these incentives. It could be, as Mr. Bernstein suggests, by increasing the price of carbon over time for the average cost in those output-based pricing systems. The trade-off is certainty in price versus certainty in quantity. That trade is hard to avoid.
With a cap-and-trade system, you can't establish that certainty at the emissions level if that cap is contained to the oil and gas sector, in particular. There is more than one way to do this and they each have advantages and disadvantages.