Water Quality Trading
Lake Winnipeg is an iconic feature on the Canadian Prairie landscape and its multi-jurisdictional basin covers the majority of Western Canada's agricultural zone. Its large and diverse drainage basin has contributed to the accelerated flow of nutrients into the lake, making it the most eutrophic large lake in the world. Effectively remediating the lake's water quality will require novel approaches that aim to lower water pollution from both point and non-point sources.
Agriculture is an important part of the economy and a significant source of non-point phosphorous emissions within the Lake Winnipeg Basin. An added management challenge for the basin includes enabling farming operations to thrive alongside healthy natural environments and water bodies.
Water quality trading (WQT) is emerging as an ecologically and economically effective approach to improve water quality and is now being applied in many parts of the world to cost-effectively reduce water pollution from point and non-point sources.
Implementing a WQT system in the Lake Winnipeg Basin (PDF - 3.6 MB) provides an opportunity to harness the power of markets to cost effectively lower phosphorous emissions in the basin. The dominance of non-point source nutrient loads improves the feasibility of WQT in the Lake Winnipeg Basin. As regulated point sources would, in principle, have access to a large pool of non-point offsets. Implementation of a WQT framework within the Lake Winnipeg Basin will have to be carefully designed so that the supply and demand for water emission credits will lead to trades enabling cost effective phosphorous reductions and well as build institutional capacity and resources for integrated water resources management.
IISD's Water Innovation Centre (WIC) is examining potential applications of WQT systems within the Lake Winnipeg Basin to lower phosphorous emissions impacting the lake. Reports from this research will present WQT background information, design considerations, case studies, a WQT architecture for the Lake Winnipeg Basin as well as a WQT framework within a smaller watershed of the lake basin.
