On Dec. 16, federal government representatives, Virginia Governor Terry McAuliffe, and others came together to recognize an innovative, market-based nutrient trading program run by Virginia to improve Chesapeake Bay water quality. The U.S. Environmental Protection Agency, U.S. Department of Agriculture, and the White House Council on Environmental Quality lauded the trading scheme as a model for similar programs across the country.
The cost-effective trading program has saved Virginia more than $1 million, demonstrating an innovative means of meeting Clean Water Act stormwater requirements and Virginia state water quality goals for the Chesapeake Bay. The program encourages economic investment while reducing phosphorus pollution to local waterways. It is expected similar programs will be established around the nation to provide new revenue sources for agricultural producers while reducing soil erosion and runoff.
Virginia’s Department of Environmental Quality has created a demand and supply market for land conservation projects that protect water quality. The agency’s stormwater program requires reductions of phosphorus runoff from certain types of road construction projects that can be achieved by purchasing phosphorus credits from state-certified credit banks. Credits purchased are generated by Virginia farmers in the Potomac River and James River watersheds, whose farming practices have permanently reduced the amount of phosphorus flowing into those rivers and, ultimately, the Chesapeake Bay. The farm practices are certified by the state as “nutrient credit banks” and come solely from private investors, reducing reliance on public funds and generating a new revenue stream for participating farmers. These credits cost Virginia Department of Transportation approximately 50% less than other, more traditional engineered pollution reduction practices, such as detention ponds and underground filters. In addition, these banks advance other goals such as wildlife habitat, stream buffers, and land preservation.