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Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of the Weiss Lake TMDL

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Page 1: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Nutrient Trading Frameworkin the Coosa Basin

Alabama Water Resources Conference

September 6, 2012

A Feasibility Study of Nutrient Trading in Support of the Weiss Lake TMDL

Page 2: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Brown and Caldwell 2

Since 2000 the Partnership has been:

• Diverse – Comprised of water with-drawal permit holders, local governments, and other advocacy entities with interest in water issues

• Collaborative – Formed voluntarily, membership by choice

• Largely self-funded• River Basin Centered - Geographic

boundaries nearly coincide with the Coosa Basin

Introduction – North Georgia Water Resources Partnership

Drought Years of the late 1990s Highlighted Need for:• Regional Planning• Integrated Planning for Water Supply, Wastewater

Treatment, and Stormwater Management

Page 3: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

3

• The Coosa Basin to Weiss Lake• Drainage area over 5,200 square miles• Majority of the watershed in Georgia

Focus Area - Coosa River Basin to Weiss Lake

Source: USEPA 2008Brown and Caldwell

Page 4: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

• Lake Weiss TMDL completed in 2008• In order to meet Alabama Chlorophyll a

standards, total phosphorus (TP) reduction targets set

• 30% phosphorus load reduction goal at the Georgia/Alabama state line.

• GAEPD considering TP permit limits for NPDES discharges of 1.0 mg/L (major) and 8.34 lbs/day (minor)

• Georgia can meet 30% TP reduction “in any number of ways” (point and/or non-point measures)

• The TMDL acknowledges that non-point sources are major contributors to the phosphorus loading

Background

Brown and Caldwell

Page 5: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Point Sources930 kg/day29%

Non-Point Sources2,280 kg/day71%

Source: USEPA Weiss Lake TMDL (2008)

• Growing Season Median TP Loads to Weiss Lake

Brown and Caldwell

Model Results for Existing Conditions

Page 6: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

What is Water Quality Trading?

• An approach to meet water quality standards in a more efficient method.

• Based on the fact that sources in a watershed can face very different costs to control the same pollutant.

• Trading programs allow facilities facing higher pollution control costs to meet their regulatory obligations by purchasing environmentally equivalent pollution reductions from another source at lower cost

• Thus achieving the same water quality improvement at lower overall cost

• A credit is a tradable unit of pollutant reduction (i.e. pound of TP)

Brown and Caldwell

Page 7: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Water Quality Trading Programs

Source: USEPABrown and Caldwell

• Programs in the US (as tracked by EPA)

• 48 with at least one trade

• Includes a range parameters and trading frameworks

Page 8: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

• Identify and Evaluate potential Nutrient Trading Frameworks

• Evaluate Existing Phosphorus Loads within the Coosa River Basin

• Identify and Evaluate Alternatives/Reduction Strategies

• Set Up Pilot Point to Non-Point Trade

Coosa Basin Tasks

Brown and Caldwell

Page 9: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Brown and Caldwell 9

• Type of Trading• NPDES Approach• Administration• Trading Factors

Key Framework Considerations

Page 10: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

• One point source to one point source trading

• Multiple facility point source trading

• Point Source Exchange Credits

Types of Trading Point Source – Point Source

Brown and Caldwell

One to one trading

Multiple Facilities

Page 11: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

• One point source to one non-point source trade

• One point source to multiple non-point source trades

• Non-point source credit exchange

Types of TradingPoint Source – Non-point Source

Brown and Caldwell

One to one trading

Credit Exchange

Page 12: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Brown and Caldwell | Footer | Date 12

• Individual Permit – trades would generally be executed through contracts between trading parties, and then documented in NPDES permits

• Watershed Permit - A similar alternative is the issuance of a group NPDES permit (or “general watershed permit”) that represents the aggregate wasteload allocation (WLA) for all participating sources. Typically, a point source can attain compliance by staying under its individual WLA or purchasing credits under the general watershed permit.

NPDES Approach

Page 13: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Brown and Caldwell | Footer | Date 13

• Agreement between individual parties – trades arranged through direct negotiation between buying and selling sources

• Credit exchange – administered by:• a coalition of dischargers• the state• private third-party broker

Administration

Page 14: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Brown and Caldwell | Footer | Date 14

• The factors modify the rate from something other than a one-to-one ratio between credits needed at point A and reductions achieved at point B.

• Generally, the magnitudes for different locations within the watersheds estimated from models.

Trading Factors

• Many trading frameworks have included the use of factors to adjust the credit exchange rate.

Example of USGS SPARROW ModelPhosphorus delivery for the Flint River in Northern

Alabama

Page 15: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Proposed Coosa BasinNutrient Trading Framework Elements

• Type of Trading• Point Source – Non-point source

• NPDES Approach• Individual Permit

• Administration• Individual Negotiations

• Trading Factor• Proposed 1:1 ratio

Trades between individual parties

EPD review & approve trading framework and modify NPDES

permits

Public participation

Develop basic trading guidance

Brown and Caldwell

Page 16: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

• Definition of the units of trade.• Definition of the manner in which credits

would be calculated for point and nonpoint source load reduction projects.

• A procedure for verifying BMPs or nutrient load reductions.

• Templates for trading agreements between parties

• Common language for incorporation into NPDES permits.

Brown and Caldwell

Trading Guidance

Page 17: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Brown and Caldwell | Footer | Date 17

• This step is currently underway

• Gathering available models and studies to understand phosphorus loads

• Identify high phosphorus load subwatersheds

• Identify potential point source partners

• Identify potential non-point source partners

Evaluate Phosphorus Loads

Page 18: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Identify and Evaluate Alternatives and Pilot Trade

• Identify potential point to non-point source trade

• Identify BMPs to reduce TP (type, size, number)

• Identify potential sites for BMP implementation

• Conduct site visit of potential BMP sites

• Develop concept plan for BMP

Brown and Caldwell

Lower Boise Wetland Concept

Page 19: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

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• Nutrient Trading is a cost effective solution for meeting water quality requirements that is supported by the EPA and Georgia EPD.

• The North Georgia Water Resources Partnership is currently investigating the feasibility of developing a nutrient trading framework and pilot trade for the Coosa Basin.

Summary

Brown and Caldwell

Page 20: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Brown and Caldwell | Footer | Date 20

Questions?

Page 21: Nutrient Trading Framework in the Coosa Basin Alabama Water Resources Conference September 6, 2012 A Feasibility Study of Nutrient Trading in Support of

Questions?

Acknowledgements:

• North Georgia Water Resources Partnership• Laurie Hawks and Clifton Bell, Brown and

Caldwell