October 11, 2013

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New Report Examines the Potential for Water Quality Trading in Missouri

Practitioners with Geosyntec Consultants developed a nutrient trading framework to further point-to-point and point-to-nonpoint trading opportunities in Missouri.

The new report, "Nutrient Trading in Missouri: Critical Policy Factors and Program Recommendations," evaluates the potential for developing a water quality trading program in Missouri. It aims to inform the development of a statewide nutrient trading program that can satisfy multiple watershed goals, including stream criteria, lake criteria, and total maximum daily loads.

Geosyntec Consultants prepared the report with colleagues at the Environmental Resources Coalition as part of a Conservation Innovation Grant awarded by the U.S. Department of Agriculture and the Missouri Natural Resources Conservation Service offices. Additional project partners included the Metropolitan St. Louis Sewer District and the Missouri Corn Growers Association.

Water quality trading is a market-based approach to pollution control that allows point sources to meet regulatory requirements by purchasing pollution reduction credits generated from agriculture or other sources that have lower pollution control costs. Although trading is a promising, cost-effective alternative to conventional waste treatment, relatively few trading programs across the country have been successfully incorporated into state permitting activities.

"In part, trading activity has been limited because drivers, such as stream or lake water quality criteria, have not been widely developed," said David Carani, a water quality scientist for Geosyntec based in Missouri who helped author the report. "However, policy factors that affect program design and implementation can also limit trading success. To be successful, a water quality trading program should be efficient, effective, and equitable for all participants. But these concepts are frequently at odds with programmatic decisions that generally favor one of these concepts over another."

"Nutrient Trading in Missouri" presents simulated nutrient trading exercises from two watersheds and explores the potential impact that critical policy factors and programmatic decisions may have on the success of a Missouri trading program. Opportunities for trading in the Missouri and Mississippi River Basins are also explored. Study results and recommendations are incorporated into a preliminary framework for a Missouri water quality trading program.

A digital version of "Nutrient Trading in Missouri" is available online. In addition, a project description detailing the development of the report is available on the Geosyntec website.