Credit trading could make river cleanup pay for farmers

WILLMAR -- Cleaning up the Minnesota River could become a paying proposition for those farmers able to take advantage of water quality credit trading.

WILLMAR -- Cleaning up the Minnesota River could become a paying proposition for those farmers able to take advantage of water quality credit trading.

In the not too distant future, farmers employing best management practices that reduce pollution might be able to earn credits which they could sell, according to Dr. Shannon Fisher, director of the Minnesota River Board and the Water Resources Center at Minnesota State University, Mankato. At the annual meeting of the Hawk Creek Watershed Project on Wednesday in Willmar, he outlined efforts toward creating a water quality trading system in the Minnesota River basin.

The idea of water quality credit trading is not new to the basin. Two ethanol plants operaating in the basin currently buy credits from wastewater treatment plants. The ethanol plants discharge more phosphorus than their permits allow. The wastewater plants have reduced their phosphorus discharge below the state's new standard, and consequently are able to sell "credits'' representing the difference.

There are a number of industrial and municipal wastewater treatment plants in the basin which may not be able to meet new discharge limits for phosphorus that are to be phased in starting this May. There is also the possibility that in future years, limits will be set for nitrogen discharges into the river, according to Fisher.

In short, there could eventually be a growing number of "customers" looking for credits. A proposal now being considered by the Minnesota Pollution Control Agency would allow farmers to earn credits to sell.


Farmers would have to be able to demonstrate how they reduced their own discharge of non-point sources of phosphorus or nitrogen to earn the credits.

"It's probably a couple of years out, but (it's) moving quickly in that direction,'' Fisher said of the proposal.

Credit trading can help clean up the river, according to Fisher. It helps reduce the overall discharge of a targeted pollutant, while also creating "added value.''

The "added value'' comes from the best management practices implemented by landowners to earn their credits. They can range from projects to stabilize riverbanks and restore wetlands to planting vegetative buffers that provide wildlife habitat.

A credit system also has the benefit of making cleanup efforts more flexible, since there are more options available, according to Fisher. He pointed to the Southern Minnesota Beet Sugar Cooperative as an example. In 2005, it planted spring cover crops on 58,832 acres of sugar beet ground to reduce nutrient runoff as part of a credit trading proposal.

No less important, credits could represent a more cost-effective tactic for cleaning up the river, he said. For small-sized wastewater plants, it can cost as much as $14 to $18 per pound of phosphorus removed. They might be able to buy credits at a fraction of the cost, while still helping further the overall goal of reducing phosphorus in the river, he explained.

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