Water Quality Experts Convene to Discuss Challenges and Opportunities to Fix Rivers Faster

Water quality trading is reaching a tipping point, expert says

A session of water quality trading experts in the Pacific Northwest recounted the successes of programs designed to protect watersheds and discussed the opportunities and challenges for the future of river restoration programs. The session, “Quantified Conservation and Water Quality Trading for Compliance,” was held February 28 in Portland. Hosted by The Freshwater Trust, the event brought together experts in the fields of water quality trading program design, policy, and implementation.

One expert, Brooks Smith of Troutman Sanders LLP, said, “Water quality trading for compliance and restoration is approaching its zenith. A lot of people have been working hard for a long enough time that we’re starting to feel a critical mass; we’re starting to perfect the systems that will enable us deploy these [trading] tools more regularly and widely.”

He cited the U. S. Department of Agriculture and the Environmental Protection Agency expanded partnership to support water quality trading announced in December 2013 as a promising example.

Can a watershed restoration approach work?

When prompted by the audience — which included wastewater treatment facility managers, engineering consultants, utilities managers and landowners — on what is creating a tipping point for trading, Smith elaborated, “The national policy is ten years old. There are close to 100 projects on the ground, tested and growing, and well over $100 million in public money invested in those experiments. And now, in real quantities, private investment in these tools at a pace and scale that matters to the resource.”

On whether water quality benefits of trading are real and can be used as a foundation for decision making, Smith responded that while trading was originally designed as a tool for compliance only, it has now emerged as a tool which “leverages that compliance option to accelerate the pace and scale of restoration” with programs that garner “broad stakeholder engagement and buy in and show meaningful progress.”

Successful trading programs build regulator confidence

Regulators often see the benefit of a watershed approach, but they “are statutorily constrained to pay attention to individual parameters,” noted David Primozich, a leading water quality expert and Senior Ecosystem Services Director for The Freshwater Trust. Our goal is to “convert the restoration actions that we think are needed into the unit of measure that the regulators regulate on.”

Water quality trading brings together regulated entities, such as permitted wastewater facilities, with other entities in a watershed, such as farmers and ranchers, in an agreement to manage the inputs to the watershed that affect temperature or nutrient loads. The landowners agree to take actions, such as planting trees on their land or erecting fencing to keep livestock out of streams, which are assigned a value and sold as credits to the regulated entity.

While these trades can be cost-effective for the regulated entity, compared to building additional technology at the wastewater plant, the overarching goal of a trading program is to take “the right actions for the resource, first and foremost,” said Primozich.

For example, the wastewater treatment facility of Medford, Oregon, purchased water quality credits generated from planting shade trees along three tributaries of the Rogue River in the facility’s service area. This “natural” action cost less than one-half the amount of an equivalent technological solution, constructing a chiller at the facility. While both solutions could address the temperature regulation that Medford’s facility needs to comply with, only the natural solution provided additional ecosystem benefits for the watershed, including enhanced fish habitat and reduced soil erosion.

Successful trading programs build confidence that “regulators can fulfill their obligations in protecting the public’s interest and ensure that actions used as compliance alternatives are real and performing the services over time,” said Primozich.

Contact Danielle Dumont, Ecosystem Services Marketing Manager