Incorporating Environmental Integrity in Water Quality Trading: Lessons from the Willamette

by Hosterman, Heather

In Oregon’s Willamette Basin a group of diverse leaders are working to expand an existing water quality-trading program from the Willamette’s Tualatin Watershed to the entire Basin, with a goal of moving beyond regulatory compliance to meet the ecological needs of the entire landscape. In increasing the scale of the existing water quality-trading program and meeting the ecological goals of the program, two concerns have arisen: (1) assuring that restoration activities generating water quality credits are credible and contribute to ecosystem recovery, while (2) maintaining adequate participation of non-point sources willing to supply credits of high environmental quality.

Using a qualitative analysis, my research examines the two primary concerns of scaling up a water quality-trading program to the landscape level. Through focus group sessions, I examine how conservation practitioners believe ecological and environmental quality should be incorporated into a large-scale water quality-trading program. Through semi-structured interviews with agricultural landowners in the Basin, I gain insight into their motives for participating in a water quality-trading program and how environmental quality standards affect their willingness to participate.

This analysis results in the classic economic trade off between market simplicity and assurances for environmental integrity. The results indicate that initially a water quality-trading program should be perceived as simple and straightforward in order to generate robust participation. Once there is adequate nonpoint source participation, environmental integrity standards or economic incentives can be incorporated into a market to target ecologically significant areas within a landscape or high environmental quality restoration and conservation actions.