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National Pollutant Discharge Elimination System (NPDES)

Water Quality Trading on a Watershed Scale

EPA’s 2019 memorandum Updating the Environmental Protection Agency’s Water Quality Trading Policy to Promote Market-Based Mechanisms for Improving Water Quality identifies six broad market-based principles that, if implemented, will help modernize and promote the development of environmental markets.

On November 5, 2020, EPA's Assistant Administrator for the Office Water shared the paper “Water Quality Trading on a Watershed Scale” with EPA regional offices.

This paper describes three factors that water quality trading program managers may want to consider when evaluating the appropriate scale for a trading area:

  1. Water quality goals, connectivity and pollutant processing;
  2. Relevant statutory, regulatory, and policy information; and
  3. Availability of data and modeling.
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