Trading in Nutrient MarketsPolicy, Administration, and Market Mechanics
Brent L. Fults – Founder 1999CBNLT (Chesapeake Bay Nutrient Land Trust) & ESS (EarthSource Solutions)
July 2013
POLICY or MARKET ? CLEAN WATER IN THE BAY…
CBNLT entrenched itself as a stakeholder in 2008. Participating in 2009, 2010, 2011 & 2012 Legislation.
CBNLT follows the “First Step” model developed as a Bay Cleanup Strategy
Covering VIRGINIA Bay watersheds: James, York Rappahannock, potomac
Policy created a market, markets created legislation
Chesapeake Bay
Cleanup
NOW
FIRST STEP M ODEL
CBNLT
MARKETS
Market Complexity
Complexity in the navigation and coordination of public programs, agricultural landowners, regulatory agencies, permit process, financial assurance placement, credit generation activities
Timeline expectations of credit providers, landowners and regulatory community
Policy – Education of all sectors has created interest and concerns by the “just say no” groups.
DEQ – Agency support is broad, permit opportunities
Locality opposition to trading: It’s the Law folks.
WHO WILL STEP FORWARD: DEQ or Stakeholders and resolve the stand off.
This is a Big Question
Market Challenges
Efficiency of Credits
Land use variations
Goals of credit program / landowners
Market Demand (nonpoint) VA VSMP
Allowable triggers resolved with pepertual answers
100% privately funded – NO GRANTS
Water quality improvements are REAL
Future of Nutrient Credit Market
Credits used for VA DEQ VSMP: Gas station, parking lot, condos, failing BMP, and compliance actions thru enforcement
Users – Private / VDOT/ Public MS4 programs soon to create a buy down of point and non point credits
Policy / EPA – Federal support in Virginia
Policy/ DEQ- State support incredible
Changing Certification regulations in 2014: Get your bank soon, its real complicated.
Growing demands: VSMP, VDOT, MS4 buydown, failing BMP
Improvements to Bay are working. Trades are occuring. 12 facilities, 4 watershed, and 40 trades in last 9 months.
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