Water Quality Trading Policy

EPA issued the National Water Quality Trading Policy in January 2003 to support innovative, market-based approaches to improving water quality. In 2019, EPA began updating its approach to market-based programs and water quality trading to reflect research results, technology improvements, and lessons learned through more than 15 years of implementing the 2003 policy. EPA continues to support innovative, science-based approaches to water quality protection and regulatory compliance, including market-based approaches like water quality trading.

• Water Quality Trading Policy Approaches Request for Comment (September 2019)
  • This Federal Register notice requested public comment on (1) policy approaches for addressing nonpoint source water quality trading baseline issues in watersheds with EPA-approved total maximum daily loads (TMDLs), (2) proposed additional guidance on several of the market-based principles identified in the January 2019 memorandum, and (3) clarification of and updates on other topics addressed in previous policy and guidance documents.
  • On October 21, 2019, EPA held a combined in-person and online listening session to gather feedback from the public on the Federal Register notice. During the session, EPA provided background on the water quality trading issues discussed in the Federal Register notice. This was followed by statements from the public.
    • Listening Session Presentation (pdf) (108.47 KB)
    • Listening Session Transcript (pdf) (1.32 MB)

• Updating the EPA's Water Quality Trading Policy to Promote Market-Based Mechanisms for Improving Water Quality (pdf) (1.53 MB, February 2019)
  • This memorandum reiterates EPA’s strong support for water quality trading and other market-based programs to maximize pollutant reduction efforts and improve water quality. Additionally, the memorandum (1) provides additional guidance to states, tribes, and stakeholders on the use of market-based programs to reduce water pollution at lower overall cost and (2) incentivizes implementation of technologies and land use practices that reduce nonpoint pollution in our nation’s water. The memorandum identifies broad market-based principles that, if implemented, will help modernize and promote the development of environmental markets.

• Water Quality Trading Policy (January 2003) (pdf) (2.99 MB)
  • In January 2003, EPA released the National Water Quality Trading Policy, which laid out a framework for trading under the Clean Water Act.