Nutrient Trading – A Water Quality Solution? - Water and Agriculture: Sustainability, Markets and Policies - page 108

Figure A. 2. Cost-effectiveness of policy options tested at reducing the amount of nitrogen delivered to the
Gulf of Mexico

25.00 500

450

20.00 400

350

15.00 300

250

10.00 200

150

5.00 100

50

0.00 0

N Trading
with GHG
payments

N fert tax Cons Till

Sub

CRP Ext. GHG

Trading
($5/t)

GHG
Trading
($14/t)

N Trading
Scenario 1

N Trading
Scenario 2

P Trading
Scenario 1

P Trading
Scenario 2

Cost N Reduction

Source : Greenhalgh and Sauer, 2003 .

Figure A.3. Cost-effective of nutrient trading: Michigan case study for phosphorus (in US dollars)

regulator y
requi rement

Conventional
Conservation Subsidi es

160

120

80

Point Source
Regulation

PS Regulations
with Trading

40

0

10 15 20 25 30 35 40 45 50 55 60 65

% Reduction in P Load

Source: Faeth, 2000.