What Does Economic Theory Suggest as Critical Elements of a Water Quality Trading Program?
A water quality credit trading program is established to meet specific pollution reduction goals. Table 1 summarizes elements that are necessary for inclusion or consideration in the implementation of a program. Critical elements of a water quality trading program. Even with these components in place, certain challenges must be addressed for a water quality credit trading program to operate. Many of the challenges relate to PS-NPS trades, where the regulated community (NPDES1 permit holders) meets the unregulated community (agriculture and other NPS). In a 2005 issue of Choices, King examined the potential supply and demand for water quality credits. King states that, on the demand side (PS), few dischargers are interested in buying water quality credits if the discharge restrictions are weak or un-enforced. More recently, many states have set limits for PS that are either already binding or are expected to become binding as populations grow. In some states, sources will be required to
