EPA Calls for Market-Based and Collaborative Approaches to Achieve Nutrient Reductions

Posted on January 10, 2019 by Todd E. Palmer

Last month, the U.S. Environmental Protection Agency (EPA) and Department of Agriculture (USDA) issued a letter to their state counterparts highlighting plans to improve water quality and seek “meaningful reductions” in nutrient loadings to waterways. EPA and USDA leadership note that while progress has been made, national water quality data indicate that nutrient losses from agricultural lands continue to be widespread, especially in the Mississippi River basin. Moving forward, the agencies plan to identify further opportunities to address nutrient loadings from nonpoint sources, including non-regulatory conservation efforts and market-based programs.

The agencies’ recommitment to these topics should come as welcome news to the regulated and environmental community alike. Existing market-based solutions, such as water quality trading, have helped allocate limited resources toward technologies and practices with a lower cost per unit of nutrient reduction. EPA and USDA state that they have heard that additional regulatory flexibility in areas such as TMDL implementation may be useful in facilitating market-based strategies. EPA’s willingness to engage with stakeholders on how it can remove regulatory barriers to such efforts is commendable.

Perhaps even more significantly, the agencies indicated a desire to partner with local stakeholders to develop local solutions to nutrient-loss challenges. State and local partners are well-positioned to develop innovative approaches to reducing nonpoint source pollution that are both effective and responsive to local needs. For example, since Wisconsin adopted more stringent numeric phosphorous water quality criteria in 2010, municipal and industrial wastewater dischargers have improved water quality and realized compliance savings through one of several market-based phosphorous compliance options. Those options include water quality trading, as well as adaptive management and the phosphorous multi-discharger variance, where sources comply with interim limits and fund local efforts to reduce nonpoint source contributions. Strategies to amplify existing market-based solutions, including creation of a “clearinghouse” to facilitate trades and other compliance strategies, are also being discussed around the country.

EPA’s willingness to support and build on these efforts by evaluating regulatory barriers and providing technical and financial support for local efforts should open the door to innovative nutrient control strategies. Federal support for these efforts is also especially critical in the current farm economy, which finds farmers managing through a prolonged period of low commodity prices that may limit the resources available for voluntary environmental enhancements.