Great Lakes Article:

EPA Touts Pollution Trading as Clean Water Fix

By Cat Lazaroff
Lycos Environmental News Service

WASHINGTON, DC, May 24, 2002 (ENS) - The U.S. Environmental Protection Agency has proposed a water quality trading plan aimed at increasing the "pace and success" of efforts to clean up polluted rivers, streams and lakes. While the program would be similar to existing trading schemes for air pollution, some conservation groups are concerned that there is no proof that water credit trading will improve water quality.

  On Wednesday, Environmental Protection Agency (EPA) Administrator Christie Whitman announced a new Water Quality Trading Policy that the agency believes could save the public hundreds of millions of dollars by providing incentives for companies to maintain existing clean water standards and improve and restore polluted waters.

The proposed policy would allow individuals and businesses to earn credits for reducing their water polluting emissions above federal requirements - and then sell those credits to companies that are not meeting those standards.

"Many of us remember when some of our country's rivers were so heavily polluted that they were catching fire in the 1960s," said Whitman. "As a result of the Clean Water Act, signed into law in 1972, the discharge of pollutants by industry was greatly reduced."

"However, there is more to be done and the policy we are proposing today will help enhance the efforts that are already underway," Whitman added. "This policy will lead to greater efficiency and better results, while being responsive, as we meet our clean water goals."

  Although the condition of the nation's waterways has improved since the passage of the Clean Water Act, many waterways are still polluted by urban stormwater, sanitary sewer overflows, agricultural runoff and air pollutants that affect water quality. The new EPA policy, while not changing current regulations or clean water standards, seeks to encourage innovative approaches to tackling remaining sources of water pollution.

"We've made a lot of progress controlling pollution from industrial and municipal sources," Whitman explained. "Now we must look to innovative strategies that complement our current programs, to help us address the remaining challenges."

The proposal "keeps existing controls and safeguards in place, but offers greater flexibility and incentives to states, tribes and companies to comply with the Clean Water Act," Whitman said. "Trading provides incentives for voluntary reductions from all sources to improve and maintain the quality of the nation's waters."

The proposal sets forth a list of provisions that trading programs would have to meet to be consistent with the Clean Water Act and other federal regulations. Industrial and municipal facilities would need to first meet existing emissions control requirements, and could then earn credits for making additional reductions in their water polluting discharges.

  But other facilities or individuals would not need to be subject to federal regulations to earn water quality credits. For example, landowners or farmers could create credits by changing agricultural practices that create runoff from fields and woodlots, or by planting shrubs and trees next to a stream as a buffer to help absorb pollutants.

Companies regulated by the EPA could then buy these credits to help meet the water quality limits set by its federal permits. The EPA says this would encourage a variety of individuals and businesses to take steps to improve water quality, regardless of their obligations under federal law.

But a coalition of conservation groups charge that the EPA's policy fails to include safeguards to ensure that water credit trading will produce real reductions in the amount of pollutants reaching waterways. As it is currently written, the groups warn, the policy could "unravel our existing, largely successful Clean Water Act regulatory programs."

Nancy Stoner, director of the clean water project at the Natural Resources Defense Council (NRDC) spearheaded an effort last month to persuade the EPA to delay its planned water credits announcement until it had a way of measuring the effects of trading programs on water quality.

  The EPA has started pilot projects to test its proposed trading program at several sites, including Long Island Sound in New York, the Kalamazoo River in Michigan, the Lower Boise River in Idaho, and the Chesapeake Bay in six states and the District of Columbia. These projects have not been operating long enough to provide proof that trading works.

"A number of states and local governments are already doing some water credit trading," Stoner said. "We think the EPA needs to look at whether those existing programs are producing cleaner water."

In April, the NRDC was joined by the Chesapeake Bay Foundation, Clean Water Action, Coast Alliance, Ocean Conservancy and Sierra Club in sending a letter to the EPA asking the agency not to move forward with the water trading proposal. The groups argued that enforcing existing Clean Water Act regulations and updating clean water criteria would be a more reliable way to improve the nation's water quality.

"While we support EPA's goal of cleaning up our water bodies in a cost effective way, we do not believe that the policy, as it is currently drafted, will further this goal," the groups wrote. "We urge EPA to focus its efforts primarily on implementing Clean Water Act programs that have demonstrated success," including the National Pollutant Discharge Elimination System (NPDES), the total maximum daily load program, protecting and restoring wetlands and creating stream buffers.

The EPA says that the NPDES program, while achieving "tremendous success in controlling point source pollution and restoring the nation's waters," has already reached its full potential and cannot address the bulk of the pollution now entering waterways. The conservation groups not that more than 50 percent of polluted waterways are still being impacted by point source discharges - pollution from identifiable sites like factory outflow pipes.

These point source polluters are the same companies and industries that might buy water credits instead of taking steps to reduce their pollution discharges, the groups warn.

The EPA says it made some changes in its proposal based on the groups' suggestions, but Stoner said today, "they certainly didn't address the bulk of our concerns."

  "We need safeguards to make trading work," Stoner explained. "We need safeguards to ensure that reductions are made, that pollution is reduced instead of just moved around, and that you don't have hotspots concentrating pollutants in one area."

Hotspots could occur, Stoner said, if a polluter opted to meet federal clean water requirements largely through credits, rather than real reductions. Such localized concentrations of pollutants could result in fish kills and other harm to aquatic life, beach closures and human health problems.

The new EPA policy is available at: http://www.epa.gov/owow/watershed/trading.htm. The EPA will accept public comments on the proposal for 45 days, and plans to release a final policy later this summer.