It looks like it could be a good idea. I don't like grades much either, except they should never be replaced with a system that rewards partial effort the same as full effort.
When I first read your article, I thought it was for elementary grades, so I was going to say something against it. Then I read the link, and while I have a few questions (since I only got to see what the article writer wanted to tell about), it looks good on paper.
If it was for younger kids, I would be against it though. Too many newer "education" reforms remove automaticity from the learning process. We do our kids a terrible disservice when we don't expect them to pass the point of "thought" when they do things.
It will be interesting to see how this plays out.