Water Quality Credit Trading and the Pollutant Trading Policy Advisory Committee
What is Water Quality Credit Trading?
Water quality credit trading (sometimes referred to as "pollutant
trading") is an innovative approach
to achieve water quality goals more efficiently. Trading is based on the
fact that sources in a watershed can face very different costs to
control the same pollutant. Trading programs allow facilities facing
higher pollution control costs to meet their regulatory obligations by
purchasing environmentally equivalent (or superior) pollution reductions
from another source at lower cost, thus achieving the same water quality
improvement at lower overall cost.
How Does Water Quality Credit Trading Work?
While trading can take many different forms, the foundations of
trading are that a water quality goal is established and that sources
within the watershed have significantly different costs to achieve
comparable levels of pollution control.
Where Will Water Quality Credit Trading Work?
Where watershed circumstances favor trading, it can be a powerful
tool for achieving pollutant reductions faster and at lower cost. Water
quality credit trading will not work everywhere, however. Trading works best
when:
- There is a "driver" that motivates facilities to seek pollutant
reductions, usually a Total Maximum Daily Load (TMDL) or a more
stringent water quality-based requirement in an NPDES permit;
- Sources within the watershed have significantly different costs to
control the pollutant of concern;
- The necessary levels of pollutant reduction are not so large that
all sources in the watershed must reduce as much as possible to
achieve the total reduction needed – in this case there may not be
enough surplus reductions to sell or purchase; and
- Watershed stakeholders and the state regulatory agency are willing
to try an innovative approach and engage in trading design and
implementation issues.
What is the Pollutant Trading Policy Advisory Committee (PAC)?
The PAC was established to assist the
Department in developing a water quality credit trading program and rule in
Florida. PAC members represent different stakeholder groups that
have are involved in the implementation of TMDLs to restore the health
of impaired waters.
PAC Background Information Documents
Water Quality Credit Trading Links
