Like Carbon, You Can Now Buy Water Offsets

Volunteers restore riparian habitat along the Little Salmon River in Idaho. BEF Water Restoration Certificates will fund river restoration projects such as this one.
Author: Bevan Griffiths-Sattenspiel

The idea that water is the new carbon – a concept espoused on this blog not once, but twice – has taken on a new dimension. The Bonneville Environmental Foundation announced this past August that they have started world’s first water offset market, allowing businesses and individuals to offset their water use in the same fashion as one would offset their carbon emissions.

The Bonneville Environmental Foundation is selling the water credits as BEF Water Restoration Certificates™ and they plan on trading the credits just like carbon offsets. According to a press release:

In an effort to bring life back into U.S. rivers and streams that are critically dewatered, the nonprofit Bonneville Environmental Foundation (BEF) announced the creation of the first and only national voluntary water restoration marketplace via BEF Water Restoration Certificates™ (WRCs).

"Americans use twice as much water as Europeans and almost forty times more than people in developing countries," said Margie Gardner, CEO of the Bonneville Environmental Foundation. "At least 36 U.S. states anticipate water shortages by 2013. Clearly we need to think more deeply about how we use water. BEF invented Water Restoration Certificates so businesses and households could learn more and take direct action to help solve our water scarcity issues."

Through WRCs, BEF offers businesses and individuals an opportunity to take responsibility for their water consumption by restoring to nature an amount of water equal to what they use. Each WRC represents one thousand gallons of water restored to critically dewatered streams.

"Water rights are managed in the Western U.S. with a 'use it or lose it' system that forces water use even when it's wasteful. When businesses and consumers buy BEF WRCs they create a revenue source that provides economic incentive to leave unneeded water in rivers and streams," explained Rob Harmon, Chief Innovation Officer at BEF, who led the development of the new program.

Charter customers that have invested in BEF WRCs to balance their water use include the Bullitt Foundation, Natural Resources Defense Council (NRDC) and WhiteWave Foods Company.
"I'm excited to see a product that so elegantly addresses one of Earth's most pressing problems - our looming fresh water crisis," said Denis Hayes, President and CEO of the Bullitt Foundation and National Executive Director of the first Earth Day in 1970. "The BEF Water Restoration Certificate is a simple and immediate way for businesses and consumers to help bring water and life back to streams that are currently dry."

The National Fish and Wildlife Foundation (NFWF) has certified the standards and criteria for all BEF WRC projects to ensure that water is returned at a time and place that will produce real environmental benefits, providing increased water flow to critically dewatered ecosystems so they can better support fish and wildlife. Also, BEF has partnered with water trust organizations at each location who work with local irrigators and monitor flow restoration. To ensure that water returned to the environment is never counted twice, WRCs are individually numbered and tracked by Markit Environmental Registry, a leading global provider of registries for ecosystems markets.

Joanna Silver, Vice President, Markit Environmental Registry said "The new WRC is a first of its kind. We are very excited to be at the forefront of this new environmental market with an innovative organization like BEF and to play a part in creating a robust and credible product. Only with quality infrastructure can environmental markets be scalable and easily implemented regionally, nationally and globally."

This market sounds pretty promising – and I am all for anything that brings new funding into river restoration projects - but I am concerned that companies will be able to claim they are “water neutral” and boost their public image by purchasing these credits. Meanwhile, their local operations can continue to harm rivers and wildlife, and money that could have gone into improving conditions for the communities in which they operate ends up being funneled out to remote restoration projects that do nothing to benefit the populations most impacted by the company’s water use.

That said, I want to reiterate that I think there is a lot of potential for water offset markets and, if anything, the market continues to reinforce the link between water and energy.

BEF even has a great blog post about some early positive results from one of their restoration projects:

We have been working on the program for about a year and a half – figuring out how it will work, writing the business plan, creating standards and codes of conduct, writing contracts, creating marketing materials, and so on. Pretty heady stuff. But, as we all know, our heads will only get us so far in this world. So…

This past August, I took a trip to southern Oregon to visit one of the project sites. It was an amazing trip and I want to share the experience with you as best I can.

The project is on Evans Creek, which flows into Oregon’s famous Rogue River at the town of Rogue River. Over the past many years this creek ran pretty much dry in the summer. This has a lot to do with logging practices up stream and the fact that more water rights are allocated than there is water in the stream during the summer. The result is that the stream dries up and there is no habitat for juvenile steelhead and Coho. No water = no fish. Pretty straight forward.

Fortunately for the creek and the fish that would like to call it home, the senior water rights holder on the creek is a guy named Lawrence Martin. Lawrence has lived on Evans Creek for a long time. In years past, Mr. Martin would grow two hay crops — one in the spring and one in the summer. He would draw his water allotment out of the creek and irrigate. This worked well in the spring. There was plenty of water from spring snowmelt. In the summer things were not so good. Pulling water out of the creek for irrigation dried it up and the hay crop was pretty marginal. It was sort of a lose – lose situation. Unfortunately, the way Western Water Law is written, if Mr. Martin did not put his water to “beneficial use” (pulling it out and using it), he could lose the water right (devaluing his property) and another water rights holder could take the water out instead. If this were to happen, the creek would still be dry and Mr. Martin’s property would be worth less. Clearly that is not going to work.

The good news is that in Oregon, the definition of “beneficial use” includes dedicating all or a portion of the water right to the stream. This is where BEF and our partners, the Freshwater Trust enter the picture. BEF contracted with Freshwater Trust to negotiate a contract with Mr. Martin. Under the terms of that contract, he dedicates to the stream, the water he would take out in the summer months to irrigate his second crop of hay.

I went to visit Mr. Martin. We pulled off the road at the edge of his property where normally we would see a large hay field. Here is what we saw instead:

I cut the story off here because you really need to see the pictures to understand the rest of the post. Thanks to the BEF Water Restoration Certificates – which apparently put 1000 gallons of water into a stream for just $1 – a stream that usually ran dry in the summer due to withdrawals from nearby farms was not only filled with water, but a beaver dam had been constructed and juvenile steelhead were found skirting around in the water. Check out the pictures and read the rest of the story at: Water Restoration Certificates, a Travel Post...

What do you think about water offsets? Would you want to encourage a company operating in your watershed to purchase them? What if the restoration project the credits were funding was hundreds of miles away? Feel free to leave a comment and share your thoughts.

Update: BEF recently contacted me about the issue I raised regarding my worry that a water offset market could fall victim to the same indulgence controversy as carbon offsets. BEF explained in an email that they had similar concerns and did their best to avoid the pitfalls of - and apply lessons learned from - the carbon offset market. I will be meeting with BEF in early December to discuss their WRC's and will provide updates as I learn more about this promising program.

Within the watershed where the withdrawal takes place...

I have been working with Volumetric Offsets as a conservation tool for the past several years. Generating third-party funds to support not-for-profit work within the watershed where the withdrawal has occurred is a vital opportunity to encourage conservation. Our company, WaterPlan offers water efficiency consulting services to industrial, commercial and institutional clients locally and internationally. This service in itself is not necessarily unique as there are many engineering and consulting firms with such capabilities. What truly differentiates WaterPlan is our ability to complement our water efficiency strategies with a portfolio of local not-for-profit water offset credit projects, designed to replace the water that an organization consumes
each day, litre for litre.

This kind of work takes water efficiency auditing and corporate social responsibility one step beyond today’s expectations, to achieve a much needed balance between industrial withdrawal of a vital natural resource and local community sustainability. The Volumetric Offset project lifecycle promotes efficiency in industry, fosters an improved awareness of the value of water within that industry and improves the lives of the communities beyond the industrial fence line.

underground resources

I live in a desert that gets 80 percent of its water supply from an aquifer, Ogalala, in Eastern New Mexico. I write to ask if there are any ideas you can arise from experience in water offsets that might be useful when water is viewed as a non-renewable resource? I don't think water offsets is a bad idea, rather a great one, but I think its application is limited to areas where water is gathered form watersheds, rivers, and replenished sources. Small scale commercial use and residential use is merely a blip on the radar, but applying water offsets in that market would help. We, down here, need to think of ways to replenish the aquifer or establish an aquifer that is not strongly susceptible to evaporation, such as surficial reservoirs filled by damming our small and controversial interstate rivers. Our rainfall is very low and very seasonal, yet our crop production is high, due to high water use. Another point of concern is agriculture itself. Our area is not agricultural without ground water irrigation, so unless we solve the ground water problem (also an interstate issue), then we potentially lose agriculture. Alas, this area was at best meant for migratory grazing, not year round agriculture. Which leads me to believe a shift to seasonal agriculture as scrupulous, yet challenging in that farmers are losing production. I don't know the numbers, but do know the area's agricultural production is significant in the world market, so decreasing production has large scale effects, that is if farmers are subsidized in a way that they can profit from decreased production and are amenable to any seasonal adjustments. Using less, replenish, and farmer viability.

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