Vote starts pollution credit-trade rule writing

Posted: January 27, 2018 at 2:31 a.m.
Updated: January 27, 2018 at 2:31 a.m.

The first program designed to trade water pollution credits from business to business is one step closer to being adopted into state regulations.

The Arkansas Pollution Control and Ecology Commission voted unanimously Friday morning to initiate the proposed rule-making for voluntary nutrient trading -- drafted by attorneys for Bentonville, Fayetteville, Rogers and Springdale.

Officials questioned before the vote whether language in the proposed regulation would prevent trades from taking place downstream of drinking water sources, and the proposal was debated again over whether it is written with specific enough language to ensure that trades will be consistently conducted in a manner that improves water quality.

"As a result, everything remains subjective and up to interpretation," said Jessie Green, executive director of the White River Waterkeeper group.

For example, she said, how the Arkansas Department of Environmental Quality would assess water-quality improvements is unclear, and the word "watershed" is not defined.

"All of these things and several other details really need to be hashed out before moving forward," Green said.

Allan Gates, an attorney for the four cities known as the Northwest Arkansas Nutrient Trading Research and Advisory Group, continued to defend the intentional vagueness of the proposed regulation's language as being necessary to encourage trading to actually occur in Arkansas. More than 20 other states have programs, he said, and they rarely have any trades. A Government Accountability Office report issued last fall found similar results.

The lack of specificity in the proposed regulation's language might encourage more participants, he said.

"It [the proposed regulation] does not attempt to answer a lot of the tough questions, and there are a lot of tough questions," Gates said.

Nutrient trading allows for the exchange of nutrient limits between dischargers in the same watershed, which is the area around a body of water that drains into that body of water.

A trade would allow an entity that contributes nutrients to a body of water through discharge or runoff from its land to elect to trade nutrient credits with another entity that contributes nutrients in the same watershed.

So if a wastewater treatment plant's operators were concerned about staying within the limits of allowed nutrients, they could ask a factory that is under its limits to trade nutrient credits. The factory would be subjected to lower limits because it would have traded away its excess nutrient allowance to the wastewater treatment plant, and the wastewater plant would be allowed to discharge more.

Too many nutrients, such as nitrogen and phosphorus, can cause algae to grow and harm fish.

Arkansas has narrative nutrient standards for water bodies, not specific measurements, but discharge permit holders are subject to nutrient limits.

The four Northwest Arkansas cities have been interested in trading as a means of lessening their burden to reduce phosphorus discharge into the Illinois River watershed.

But Commissioner Wesley Stites pointed out Friday that a part of the regulation specifies that trades should specifically benefit any reservoirs that are in the watershed, such as Beaver Lake, which means that trades may not occur downstream of the reservoir. Stites is a biochemistry professor and chairman of the Chemistry and Biochemistry Department at the University of Arkansas, Fayetteville.

"My concern there is that is a profound limitation on where one could do this," Stites told Gates.

Stites expressed concern that such a limitation was not intended by the law passed in 2015 that allowed nutrient trading programs.

Gates argued that state law, encoded as 8-4-232, was silent on limiting the location of trades to upstream of reservoirs in some circumstances.

Metro on 01/27/2018