Water Quality Trading
 US Environmental Protection Agency                                                                             

[Regulations & Documents]

In January 13, 2003, Administrator Christine Todd Whitman announced the issuance of the final water quality trading policy by stating that, "the most effective and economical way to reduce pollution is to provide incentives to encourage action by those who can achieve reductions easily and cost-effectively”. The policy supports the trading of nutrients and sediments within a watershed. Additionally, the US EPA is providing $800,000 to support 11 projects around the country. The following links provide more information.

1. EPA Water Quality Trading Page

  • State and Individual Trading Programs page
  • A Summary of U.S. Effluent Trading and Offset Projects (1999). Environomics for US EPA Office of Water 
  • Results of Water-Based Trading Simulation (1999). Chuck Marshall for Office of Science and Technology 
  • Water Quality  Trading Toolkit for Permit Writers (2007) Page
  • U.S. EPA Final Water Quality Trading Policy (2003) - Federal Register Issuance of Final Policy
  • U.S. EPA Water Quality Trading Assessment Handbook (2004) 
  • Wetlands and Water Quality Trading: Review of Current Science and Economic Practices with Selected Case Studies - US EPA Report (2007)  
  • EPA Water Quality Trading Evaluation (2008) PDF
  • TMDL Implementation: Characteristics of Successful Projects (2006) Final Report

2. EPA Watershed-based NPDES Permitting website

  • EPA webcast seminar: Introduction to Trading for Water Quality Protection (2005)

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 [Targeted Watershed Program]

TWG Program home page

2009 Targeted Watershed Grants
Federal funding was awarded to CTIC to study the feasibility of a water quality credit trading program in the Wabash River basin. Link to CTIC Page

Targeted Watershed Grants
The 2008 TWG focused on water quality trading or other market-based water quality projects in the Ohio River Basin, and the Upper and Lower Mississippi Rivers. They awarded ten finalists $3.7 million.

Link to 2008 TWG
web page

2006/2007 Targeted Watershed Grants
Fifteen finalists were selected for a total $12.4 million in implementation grants. Two grants were awarded for market/trading projects: Clear Creek (CO), and Saluda-Reedy Rivers (SC)

Link to 2006/2007 TWG
web page

2005 Targeted Watershed Grants
For 2005, twelve targeted watersheds were awarded over $9 million in total. Four of the targeted watersheds featured market-based and/or trading programs. They consisted of: Vermillion River (MN), Tuttle Creek Lane (NE, KS), Willamette River (OR), and Skagit River (WA).

Link to 2005 TWG web page

TWG 2005 Annual Report

2004 Targeted Watershed Grants
On July 19, 2004 the USEPA announced its Targeted Watersheds under the 2004 program. Trading was featured in five of the fourteen targeted watersheds. These watersheds include the Lake Tahoe (CA/NV), Bear River (ID, UT, WY), Kalamazoo River (MI), Cape Fear (NC) and Passaic River (NJ).

Read a summary of each trading project.

Link to 2004 TWG web page

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US EPA Sponsored National Forum on Water Quality Trading, Chicago, IL. July 22-23, 2003.

US EPA 2nd National Water Quality Trading Conference. Pittsburgh, PA, May 23-25, 2006.

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US Department of Agriculture                                                                                          

 [Conservation Innovation Grants]

USDA NRCS Conservation Innovation Grants main page

CIG Winners:

2010: Water quality trading projects include:
  • "Building an online multistate water quality trading platform and carbon estimation tool for the Chesapeake Bay watershed" (World Resource Institute)
  • "To utilize an on farm nutrient assessment and BMP credit calculation tool developed to facilitate ecosystem market trading for inventorying farmers voluntary conservation practices" (Maryland Department of Agriculture)
2009: Water quality trading projects include:
  • "Implementing Point to Non-Point Source Nutrient trading in the Chesapeake Bay" (Maryland Department of Agriculture, MD)
  • "Coupling Market Infrastructure with Ecosystem Services Markets: Initial Framework Scoping for an Ohio River Credit Trading Program" (Electric Power Research Institute, Inc. CA)
  • "Best Management Practices for Water Quality on Private Timber Sales" (Missouri Department of Conservation, MO)
  • "Missouri Innovative Environmental Stewardship Project will demonstrate best management practices for nutrient reductions in water runoff and introduce carbon and nutrient trading to Missouri farmers." (Environmental Resources Coalition, MO) 

2008: Water quality trading projects include:
  • "Development and Application of a Modified NTT Tool for Water Quality Trading" (Tarleton State University, MD)
  • "Starting It Local: Transferable Market Infrastructure for Trading Water Quality Credits & Ecosystem Services in the Upper Mississippi River Basin" (Minnesota River Basin Joint Powers Board)
    2007: Water quality trading projects include:
    • "Customized Training on Water Quality Trading for Agriculture and Waste water Facilities" (Conservation Technology Information Center MD, OH, VA)
    • "Piloting Point Source to Non-Point Source Nutrient Trading in the Upper Chesapeake Bay" (Maryland Department of Agriculture)

    2006: Water quality trading projects include:
    • "Improving Conservation and Agricultural Economics with Water Quality Credit Trading and the BMP Challenge" (Agflex, Inc.)
    • "Development and Implementation of a Water Quality Bank and Trade Program for the Potomac River Watershed, WV" (West Virginia Research Corp.)

    2005: Water quality trading projects include:
    • "Great Miami River Watershed Water Quality Credit Trading Program" (Miami Conservancy District, OH)

    2004: Water quality trading projects include:
    • "Designing, Evaluating, and Implementing a Market-based System for Delivery of Conservation Practice Funding" (Pennsylvania Environmental Council)
    • "Innovative Cropping Systems Environmental Credit Program" (Colonial Soil and Water Conservation District, VA)  

      [USDA Farm Bill]

    2008 Farm Bill Website
    Conservation Measures (including market-based incentives) web page
    Resources, Northeast Midwest Institution

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     [Other USDA Links]

    Water Quality Trading: Social and Legal Issues - USDA Site Page

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