Nutrient Trading – A Water Quality Solution? - Water and Agriculture: Sustainability, Markets and Policies - page 103

Greenhalgh and Sauer 2003). As an adjunct to regulatory policy, nutrient trading provides
the flexibility for regulated sources to achieve their regulatory requirements more cost-
effectively, while achieving overall water quality improvements.
In the U.S., these instruments are gaining popularity. Currently there are
approximately 40 trading initiatives involving 17 states and one regional effort, and six
statewide trading policies and programmes in existence. There are a further 27 proposed
trading initiatives under development (Breetz et al., 2004). The release of the USEPA
Water Quality Trading Policy in January 2003 has also provided certainty to many
regions and states that would like to use trading to achieve water quality targets that these
reductions will be recognised, spurring even greater interest in nutrient markets.
The often overlooked beauty of these instruments is the synergistic benefits for other
environmental problems. For instance, a nutrient trading policy for nitrogen aimed at
reducing the size of the hypoxic zone in the Gulf of Mexico also leads to improvements
in local water quality, reductions in GHG emissions and reductions in soil loss. Policies
that address a diversity of environmental issues are becoming increasingly attractive in
many areas that are facing a myriad of environmental concerns. This awareness, tied with
the evolution of on-line nutrient trading markets like NutrientNet will help pave the way
for a new era that focuses on performance-based instruments to meet environmental
goals.
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