By Amena H. Saiyid
Jan. 17 --A coalition of government officials and representatives of
environmental advocacy groups has set up a national network on water quality trading that will show
how water quality improvements can be achieved at a lower cost through
market-based approaches than by installing controls at wastewater treatment
plants, industrial facilities and power plants.
Launched Jan. 14, the
network aims to provide options and recommendations to improve consistency,
innovation and integrity across trading programs.
Protection Agency's water quality trading policy, issued in 2003, is
essentially is a cap-and-trade program, with the total maximum daily load
allocations for nonpoint and point sources serving as the cap against which
various sources trade pollutant credits. These allocations are then
incorporated into NPDES permits for point sources.
The EPA policy
allows point source dischargers such as publicly owned water facilities or
power plants to pay nonpoint sources such as farm operations to reduce certain
pollutants such as nitrogen and phosphorus. States such as Oregon are using
this scheme to trade credits earned through maintaining or lowering water
temperature or meeting dissolved oxygen or ammonia limits.
the network overview, there are a variety of trading programs operating across
the country at the state and local levels.
The national network will
provide a single forum for consolidating principles and practices of trading
programs that worked and lessons from programs that failed. It also will offer
a venue for federal and state environmental, agriculture and water officials
to hold a “dialogue” with representatives of regulated sectors, including
municipally owned wastewater utilities and power plants, environmental groups
The network will release two white papers this spring.
The first paper will consolidate a range of options with pros, cons and issues
based on experiences of existing water quality trading programs to consider in
building a trading program. The second paper will attempt to establish a
common set of principles and best practices to assist trading programs.
The Oregon-based Willamette Partnership--a coalition of conservation, city,
business, farm and science leaders in the Willamette River basin--and the
environmental advocacy group World Resources Institute will serve as the
network coordinators to the participants--American Farmland Trust, National
Association of Clean Water Agencies, Association of Clean Water
Administrators, National Association of Conservation Districts, Chesapeake Bay
Foundation, the Freshwater Trust, Electric Power Research Institute (EPRI),
the Ohio Farm Bureau Federation, Environmental Defense Fund, Troutman Sanders,
Kieser & Associates, LLC, the US Water Alliance, and the Maryland
Department of Agriculture.
ACWA executive director, told Bloomberg BNA Jan. 17 that state and interstate
officials represented by her group signed onto the network because “we want to
expose our regulators to as much information about successful trading as we can
as well as provide them with opportunities to learn from unsuccessful
Trading has to be incorporated into the Clean Water Act
National Pollutant Discharge Elimination System permitting programs that 46
delegated states are delegated to run with EPA oversight.
was launched two days after network participant EPRI released “Case Studies of Water Quality Trading Being Used for
Compliance with National Pollutant Discharge Elimination System Permit
Limits”. The report by EPRI provided a snapshot of how water quality
trading programs are incorporated in 18 NPDES permits. The report found “a
dichotomy” in the way water quality trading is authorized and used in the
The report found that permit holders weren't applying credits
toward NPDES permit obligations for reasons ranging from the nascent nature of
the trading program to a lack of a regulatory need to use the credits.
EPRI also found variation in the types of permit holders who sought to
incorporate trading, and also how trading was incorporated in the permits. The
group also found that most of the permit holders seeking to use trading as one
scheme for complying with permit obligations are wastewater treatment
EPRI, which is a nonprofit that conducts research and
development on electricity generation, delivery and use, is a partner itself
in a pilot interstate trading project in the Ohio River Basin among farmers,
power plants and wastewater utilities that is yet to begin trading.
To contact the reporter on this story: Amena H. Saiyid in Washington
To contact the editor responsible for this story: Larry Pearl at firstname.lastname@example.org
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