The scale and type of the trading programs, though critical, may matter less than just getting them started. "Our analysis shows that water-quality trading of any kind can s
ignificantly lower the costs of achieving Clean Water Act goals," said Martin W. Doyle, professor of river science and policy at Duke's Nicholas School of the Environment.
"All other things being equal, regulators should allow trading to occur at the river basin scale as an appropriate first step. Larger spatial scales may be needed later if abatement costs increase," said Doyle, who also serves as director of the water policy program at Duke's Nicholas Institute for Environmental Policy Solutions.
The new study was published this month in the journal Water Resources Research. It comes at a time when regulators are debating the optimal scales and types of trading programs to reduce water pollution in some of the nation's largest and most troubled watershed systems, including the Chesapeake Bay watershed, which spans 64,000 square miles in parts of six states.
In water-quality trading programs, facilities facing higher pollution control costs are allowed to meet their regulatory obligations by purchasing pollution reduction credits from other polluters in their trading market. The end result -- improved water quality -- is the same, but the time and money needed to achieve it is less.
New programs are often delayed because regulators want to get as many things right up front as they can. Concerns include how big or small a trading market should be, whether it should include interstate trading, and whether it should be based on one-for-one trades or trading ratios....