Water Quality Trading in the Non-Tidal Passaic River Watershed

christopher C. Obropta (1), Mehran Niazi (2), and Josef S. Kardos (2)

(1) Assistant Extension Specialist in Water Resources, Assistant Professor, Department of Environmental Sciences, Rutgers University, New Jersey, 14 College Farm Road, New Brunswick, NJ 08901,  732-932-4917, 732-932-8644, obropta@envsci.rutgers.edu, www.water.rutgers.edu

(2) Graduate Assistants, Department of Environmental Sciences, Rutgers University, 732-932-9075,
732-932-8644, mehranniazi@yahoo.com, jkardos@envsci.rutgers.edu

The New Jersey Department of Environmental Protection (NJDEP) 2004 Integrated List of Waterbodies identified 17 segments, affecting over 200 stream miles, in the non-tidal Passaic River basin as impaired for phosphorus.  In-stream phosphorus concentrations in these segments were greater than the 0.1 mg/l New Jersey Surface Water Quality standard for total phosphorus.  Excessive phosphorus is a concern because it can cause algal blooms, decreased levels of dissolved oxygen, taste and odor problems in drinking water, and even fish kills.  As a result, NJDEP is developing a Total Maximum Daily Load (TMDL) that will set phosphorus load allocations for point and nonpoint sources in the watershed.  The most immediate impacts will fall on 24 of the largest wastewater treatment plants (WWTPs) in the basin, 19 of which are permitted for greater than one million gallons per day (MGD) of flow.  Most WWTPs will likely have to significantly reduce phosphorus effluent concentrations to meet anticipated TMDL waste load allocations.  The traditional regulatory approach towards implementing the TMDL via the state’s pollution discharge elimination permit may result in the need for an affected WWTP to upgrade its phosphorus removal process to meet its waste load allocation, which could be very expensive for the WWTPs involved.

Rutgers University is the recipient of funding from the U.S. Environmental Protection Agency (USEPA) Targeted Watershed Grant Program to develop a water quality trading program to implement the phosphorus TMDL for the non-tidal Passaic River watershed.  Rutgers University and Cornell University faculty, with expertise in water quality modeling, wastewater treatment, environmental policy, and environmental economics, are working together with USEPA, the New Jersey Department of Environmental Protection (NJDEP), the Passaic River Basin Alliance, local municipalities, and environmental non-governmental organizations (NGOs) to design, implement, and evaluate a phosphorus trading program for the non-tidal Passaic River basin.  The project design phase has been running since September 2005, and the implementation and evaluation phases will extend through August 2008. 

Results from the project design phase are presented.   The development of a trading framework that addresses trading ratios, trading boundaries and elimination of existing hot spots, and the results from water quality and economic modeling of simulated trades are discussed.