Chesapeake cap-and-trade plan sparks lawsuit

Environmental groups say a new EPA rule could put the health of the Chesapeake Bay at risk (Photo: Gary Cameron, Reuters).
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Brooks Hays

Environmental groups are suing to block a new cap-and-trade program for the waters of the Cheseapeake Bay, a 200-mile estuary running from Maryland to Virginia. Food & Water Watch and Friends of the Earth argue the plan being touted by the Environmental Protection Agency (EPA) and the Department of Agriculture (USDA) would undermine the Clean Water Act.

The group alleges that the EPA's regulatory model is flawed and that the public was not given enough time to comment on the proposed rule.

Like emissions trading, water quality trading — as the EPA terms it — involves setting a limit on the overall amount of pollution that can go into a body of water. Polluters can meet the water quality goal by cutting their own emissions, or buying credits from businesses that have cut theirs. Since the cost to control emissions at one facility may be lower than at another, companies can buy and sell pollution credits to meet the quality goal while keeping their costs down. Proponents argue that this method gets the most environmental bang for the buck.

Cap-and-trade is already a reality in Maryland, Virginia, Pennsylvania and West Virginia, but now the EPA wants to establish it as a bay-wide program. Agency officials believe it can serve as a model for the nation.

Cap-and-trade rules for controlling acid rain have been successful, argues J. David Foster, former EPA analyst and now riverkeeper for the Chester River Association in Maryland. While he cautions that it is “no panacea,” he says the scheme “might offer the only affordable means of cutting pollution enough to protect our waterways and the living resources they support.”

But critics argue it will simply be an excuse to pollute. Cap-and-trade "will allow new and increased pollution discharges into the Chesapeake Bay watershed under a complex system of market-based offsets and pollution trading that we believe is illegal under the Clean Water Act," Wenonah Hauter, Executive Director of Food & Water Watch, argued in a recent Huffington Post op-ed.

As the Washington Post reports, some critics worry that the rule will translate to increased pollution in low-income and minority communities. Others say there aren't enough safeguards to prevent fraud.

Hauter says the proposal is emblematic of a larger trend: the "financialization" of conservation. She argues cap-and-trade takes the responsibility for clean water away from regulators and gives it to the business sector, making it “secondary to the economic interests of the few.”

The Chesapeake Bay is the largest U.S. estuary, with a watershed that includes parts of six states and all of the District of Columbia. It produces about 500 million pounds of seafood per year, according to the Chesapeake Bay Program, a public-private partnership.