1. Trading in Nutrient Markets
Policy, Administration, and Market Mechanics
Brent L. Fults – Founder 1999
CBNLT (Chesapeake Bay Nutrient Land Trust) & ESS (EarthSource Solutions)
July 2013

2. POLICY or MARKET ?
 CLEAN WATER IN THE BAY…
 CBNLT entrenched itself as a
stakeholder in 2008. Participating in
2009, 2010, 2011 & 2012 Legislation.
 CBNLT follows the “First Step” model
developed as a Bay Cleanup Strategy
 Covering VIRGINIA Bay watersheds:
James, York Rappahannock, potomac
 Policy created a market, markets
created legislation
Chesapeake Bay
Cleanup
NOW
FIRST STEP M ODEL
CBNLT
MARKETS

3. Nutrient Banking

4. Market Complexity
 Complexity in the navigation and coordination of public
programs, agricultural landowners, regulatory agencies,
permit process, financial assurance placement, credit
generation activities
 Timeline expectations of credit providers, landowners and
regulatory community
 Policy – Education of all sectors has created interest and
concerns by the “just say no” groups.
 DEQ – Agency support is broad, permit opportunities
 Locality opposition to trading: It’s the Law folks.
 WHO WILL STEP FORWARD: DEQ or Stakeholders
and resolve the stand off.
 This is a Big Question

5. Market Challenges
 Efficiency of Credits
 Land use variations
 Goals of credit program / landowners
 Market Demand (nonpoint) VA VSMP
 Allowable triggers resolved with
pepertual answers
 100% privately funded – NO GRANTS
 Water quality improvements are REAL

6. Future of Nutrient Credit
Market
 Credits used for VA DEQ VSMP: Gas station, parking lot,
condos, failing BMP, and compliance actions thru
enforcement
 Users – Private / VDOT/ Public MS4 programs soon to
create a buy down of point and non point credits
 Policy / EPA – Federal support in Virginia
 Policy/ DEQ- State support incredible
 Changing Certification regulations in 2014: Get your bank
soon, its real complicated.
 Growing demands: VSMP, VDOT, MS4 buydown, failing
BMP
 Improvements to Bay are working. Trades are occuring. 12
facilities, 4 watershed, and 40 trades in last 9 months.

7. Nonpoint VSMP is the Market:
9860 +- Active permits.