Development of Conceptual Framework for Water Quality Trading

Water resources in our world: Scarce and Precious. Preservation of these resources in their pristine form is of utmost significance for the whole of humanity. The industrial sector consumes a huge amount of water and also pollutes it, further alleviating the problem of water scarcity. In order to incentivize the industries for effluent treatment and environmental issues as a whole, several "Trading Schemes" have come up. Water Quality trading and Effluent trading are some of its forms. This study is focused on Water Quality Trading (WQT). It is an innovative and cost-effective approach to achieve water quality goals more efficiently. The intent of trading is to achieve an expected reduction of a particular pollutant at a lower cost by allowing sources with high abatement costs to purchase pollution discharge reductions from sources that have lower abatement costs. The challenge with trading is to allow for innovative, market-based reforms without compromising the existing safeguards in environmental protection. All the possible elements required for the successful implementation of WQT program to work with full efficacy have been discussed in the paper. It shall serve as a guideline to the researchers and developers to design more effective programs. Water-quality trading is an area of active development in environmental markets.