Natural solutions to watershed restoration and improved water quality can be a viable option for regulated entities such as wastewater treatment plants that have new limits on discharge for temperature, phosphorus or nitrogen. A well-designed water quality trading program can help the entities meet compliance obligations.

1. Water Quality Trading for Temperature &
Nutrient Compliance: A Turn-key Solution
Alex Johnson, Ecosystem Credit Programs Director
Idaho Operators Conference, May 19, 2014

2. Title of the slide hereWater Trends: United States
Impaired Waters in the United States
under Section 303(d) of the Clean Water Act
Percentage of assessed rivers
and streams reported to EPA as
“impaired” or “threatened” water
quality.
SOURCE: http://www.epa.gov/waters/ir/

3. Existing Conditions
ÆÆ CONSERVATION REACTS to
environmental challenges at a small
scale (fish, wildlife, water quality, etc.),
after degradation
ÆÆ REGULATORY DRIVERS are present
on small percent of overall impacts
ÆÆ TECHNOLOGICAL SOLUTIONS
employed by regulated entities are
appropriate for some, but not all, new
parameters

4. Need New Approaches to Meet NPS Challenge
SOURCE: http://www.deq.state.or.us
Point Source
Non-Point Source
86%
14%
Thermal impacts of
non-point vs point sources,
Willamette River TMDL

5. For restoration to be viable
compliance alternative...
CLEAR AUTHORITY:
ÆÆ Regulators must adopt and promote required
rules
CLEAR FRAMEWORK:
ÆÆ Approved standards and protocols for
measuring ecosystem services and
implementing credit generating projects
CLEAR ROLES:
ÆÆ Third parties (such as The Freshwater Trust)
willing to assure delivery of compliance-grade
credits with secure, turn-key projects
Three Keys for Restoration to Work

6. Crediting Protocol
Idaho, Oregon,
and Washington
water quality
agencies (with
technical oversight
from U.S. EPA
Region 10) working
together on joint
regional statement
that defines
recommendations for
implementing water
quality trading
Facilitated by
the Willamette
Partnership and
The Freshwater Trust

7. Title of the slide here
ÆÆ Modeling regulatory
policy outcomes
ÆÆ Permitting
calculations &
projections
ÆÆ Natural alternatives
to end of pipe
ÆÆ Program costs
ÆÆ Implementation &
billing schedules
ÆÆ Logistics &
supply chain
ÆÆ Building compliance
portfolios
Calculations & Quantification

8. Required Traditional Restoration vs. Required Compliance-Grade Credits
Traditional Restoration Steps Compliance-Grade Credit Generation Steps
Identify project site Identify project site
Fundraising Financing
Negotiate 20+ year contract with landowner
Collect pre-project data
Project design Project design
Estimated credit values
Implement Implement
Verification that implementation meets standards
Certification that credits meet accounting protocols
Credit registration
Monitoring and maintenance (Years 1 – 3) Monitoring and maintenance (Years 1 – 3)
Monitoring and maintenance (Years 4 – 20)
Annual payments to landowners (20+ years)
= Local Project Managers = The Freshwater Trust

9. Local
Restoration
Partners
(e.g. Watershed
Council)
Regulated Entity
Projected to be
Out of Compliance
(e.g. Wastewater
Facility)
Contracted
Stream Restoration
Organization
(e.g. Non-Profit)
Completed
Project/Credit
Generation
(Uplift for ecosystem
services through
restoring streams)
Verified,
Certified and
Registered
Credits
(Completed by a
third-party)
Regulated
Entity
Purchases
Credits to Meet
Compliance
VERIFIED
CERTIFIED
REGISTERED
Local
Nurseries
Local
Contractors
Local
Landowners
Local Heavy
Equipment
Operators
Restoration Alternative Transaction Process
Project Funding
& Recruitment
Credit
Calculation
Verification,
Certification
& Credit
Registration
Project
Implementation
Credit Sale

10. Local
Restoration
Partners
(e.g. Watershed
Council)
Regulated Entity
Projected to be
Out of Compliance
(e.g. Wastewater
Facility)
Contracted
Stream Restoration
Organization
(e.g. Non-Profit)
Restoration Alternative Transaction Process
Project Funding
& Recruitment

11. Local
Restoration
Partners
(e.g. Watershed
Council)
cted
m Restoration
zation
-Profit)
Completed
Project/Cred
Generation
(Uplift for ecosy
services through
restoring stream
Local
Nurseries
Local
Contractors
Local
Landowners
Local Heavy
Equipment
Operators
Restoration Alternative Transaction Process
Project
Implementation

12. Completed
Project/Credit
Generation
(Uplift for ecosystem
services through
restoring streams)
Verified,
Certified and
Registered
Credits
(Completed by a
third-party)
Regulated
Entity
Purchases
Credits to Meet
Compliance
VERIFIED
CERTIFIED
REGISTERED
Local
Nurseries
Local
Contractors
Local
Landowners
Local Heavy
Equipment
Operators
Restoration Alternative Transaction Process
Credit
Calculation
Verification,
Certification
& Credit
Registration
Credit Sale

13. Title of the slide here
ÆÆ Program design and
site prioritization
ÆÆ Local & ecological
priorities
ÆÆ Contracting leases
with public & private
owners
ÆÆ Site design based
on reference
conditions &
quality standards
& best professional
judgement
Prioritization, Design & Contracting

14. Ken Denman Wildlife Area Riparian Planting
Pre-Planting Aerial View
Post-Planting Aerial View
Cottonwood/Alder Planting
Willow Planting

15. Title of the slide herePre-Project Conditions: February 2012
Photo Point 1B Photo Point 2A Photo Point 3A

16. Title of the slide hereAs Built Conditions: May 2012
Camera Point 1B Camera Point 2A Camera Point 3A

17. Year 1 Conditions: September 2012
Camera Point 1B Camera Point 2A Camera Point 3A

18. Year 2 Conditions: September 2013
Camera Point 1B Camera Point 2A Camera Point 3A

19. Verification & Registration

20. Calculating Credits
Credit Type Pre-project Post-Restoration Reduction
Temperature
(kCals/day)
56,246,205 41,726,475 14,519,730
Phosphorus
(lbs/year)
6 1 5
Nitrogen
(lbs/year)
103 12 91
Sediment
(lbs/year)
8,243 3,331 4,912

21. Title of the slide here
ÆÆ Projects have pre-
project data and are
monitored annually
ÆÆ Monitoring data is
collected and stored by
the StreamBank web
platform, providing a
searchable/reportable
database of project
results that can also
be ported to other
databases
StreamBank® app
Monitoring: Performance & Transparency

22. Case Study: City of Medford
Buyer: City of Medford (population 170,000)
Seller: 20+ landowners in Rogue River Basin
Broker: The Freshwater Trust
Driver: Projected excess heat under TMDL limits:
300 million kcals/day in 10 years
Options:
ÆÆ Giant holding pond to store water for 1 month
of each year: $16 Million
ÆÆ 10-15 miles of native riparian vegetation
restored and maintained for 20 years:
$6.5 Million
Money Stays in Local Economy:
ÆÆ Money pays local restoration contractors
ÆÆ Farmers get annual lease payments
ÆÆ Restoration = 20 jobs per $1 Million spent
Rogue River Basin

23. Degraded Conditions

24. Degraded Conditions

25. Degraded Conditions

26. Implementation Actions

27. Implementation Actions

28. Implementation Actions

29. Four Keys for Communities
Restoration prevails on the four
factors that matter...
ÆÆ ECONOMIC: Restoration compliance
generally far less expensive than technological
solutions, spread over many years
ÆÆ SOCIAL: Restoration keeps funding in the
local community, creating jobs
ÆÆ ECOLOGICAL: The restoration solution
converts point-source investment into
non-point source projects, with multiple
environmental benefits
ÆÆ TURN-KEY: Cities only pay for certified credits

30. ÆÆ Roughly $10M in thermal credits currently
contracted in Oregon with 5 buyers
ÆÆ Contracted first nutrient credit
demonstration program in Klamath Basin
ÆÆ Quantified conservation analysis for Idaho
Power Co. in support of Hells Canyon
Complex FERC relicensing
ÆÆ Developing metrics for Eugene source
water protection program
ÆÆ Active consulting throughout Northwest
ÆÆ Regulatory clarity
ÆÆ Communication asset development
ÆÆ FERC relicensing analysis
ÆÆ Credit program development
Active Programs

31. Water Quality Trading for Temperature &
Nutrient Compliance: A Turn-key Solution
Alex Johnson, Ecosystem Credit Programs Director
Idaho Operators Conference, May 19, 2014