Municipalities View of the Connecticut Nitrogen Credit Trading Program

The State of Connecticut established a pollution credit-trading program to achieve the nitrogen total maximum daily load (TMDL) for improving and protecting the water quality in Long Island Sound. It has been in effect since 2002 and is proving to be one of the most successful pollution credit trading programs in the country.This paper describes the problems associated with Long Island Sound and the reasons for establishing a TMDL. It then explains the development of the nitrogen credit trading program and its management through a Nitrogen Credit Trading Advisory Board. It describes how the annual cost of the nitrogen credits is established and the success of program to date. Furthermore, there is a discussion of how municipalities are using this program to determine when, if and to what extent they need to upgrade their treatment facilities. This is especially important for smaller communities, which do not discharge directly to the Sound.Stamford, Connecticut is the fourth largest city in the state and discharges treatment plant effluent near the area of Long Island Sound that has the lowest dissolved oxygen. The Stamford treatment plant is currently nearing completion of a $105M upgrade and expansion; $60M of that is associated with nitrogen removal processes. Stamford expects to be a major seller of nitrogen credits once the plant is finished and steady-state operation is achieved. The selling of these credits will help offset the debt service associated with the upgrade thereby stabilizing the user charge.Many communities throughout the United States are faced with removing nutrients at their treatment facilities. The success of the Connecticut program can be used by other states to help establish similar programs, which benefit the environment while reducing the financial obligation to the ratepayers.