Some water quality advocates think getting big industrial polluters to pay for farm runoff prevention projects is an innovative way to control water pollution. But critics of the Ohio River’s pollution credit trading system say it’s just another pay-to-pollute scheme.

There are about 55 cows and 10 pigs on Ken Merrick’s farm in eastern Ohio. It sits on a hillside above a creek that leads to the Tuscarawas River, a tributary of the Ohio River. It’s a part of the country Merrick is plenty familiar with. He grew up milking cows at his grandma’s place, which is right next door to the property he and his wife have farmed since 2005.

Today, they sell grass-fed beef and pasture-raised pork direct to customers. By a barn at the top of the hill, you can see one of their farm’s main hubs of activity: A spot where they feed their animals—and pile their manure.

It’s a muddy hill.

“This was literally, at times, waist-deep in mud in spots,” Merrick says.

LISTEN: “This Farm Could Be a Model for Cleaning Up the Ohio River”

The cows used to slosh around in it while they ate. And the manure? Today, the pile is more than five feet tall. But Merrick says that’s nothing.

“That pile’s actually half the size it was a month and a half ago.”

The manure and mud used to wash down the hill, mucking up the creek that runs through his property. And Merrick didn’t like that.

“I needed to change something,” he says. “The manure would wash off every time it rained. We didn’t have any way of containing it, and we didn’t have space for the cows.”

Ken Merrick and his wife, Natsuko. Photo: Julie Grant

Ken Merrick and his wife, Natsuko, on their farm in eastern Ohio. Photo: Julie Grant

This type of agricultural runoff is common, and it creates a serious pollution load. There are more than 250,000 farms in the Ohio River watershed, which is part of the larger Mississippi River Basin. And farm runoff from the Mississippi, which contains nutrients like nitrogen and phosphorus, is considered the major contributor to the 6,000-square-mile dead zone in the Gulf of Mexico.

Though agricultural runoff is largely unregulated, Ken Merrick decided he wanted to do something to stop it on his farm. His plan was to create a large concrete slab for the cows and manure at the top of the hill, secure the hillside and fence the cattle away from the stream. But the $20,000 price tag was pretty steep.

“That’s an enormous cost,” he says. “Most people would do [it] if they have the opportunity, but they don’t have the money to do it. So it never gets done.”

But Merrick was able to get it done with help from a regional water credit trading program. That’s where industrial polluters—like power plants—buy credits as a way of meeting their pollution limits. And the money goes to farmers to pay for projects like the one on Merrick’s farm.

“We started looking into it to try to test out if water quality trading could be an effective mechanism to protect America’s waters—and to meet company bottom lines,” says Jessica Fox, an environmental scientist with the Electric Power Research Institute (EPRI), which runs the credit program.

That’s one reason water trading credit programs have been popping up around the country: It might be more cost effective for industry to pay for farm projects that clean up nitrogen and phosphorus pollution than to control an equal amount of it at their plants.

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Currently in the Ohio River watershed, there are limits on nitrogen but not on phosphorous pollution. As these nutrients are increasingly blamed for toxic algae blooms, that’s expected to change. For instance, environmental regulators in Ohio are now pushing for new limits on phosphorus pollution in the Ohio River. And that could make those credits—which cost $10 for a pound of nitrogen or phosphorous—more appealing.

Jessica Fox has worked for more than a decade on this water pollution marketplace between Ohio, Kentucky and Indiana. It’s the first multi-state program in the country.

“The first thing outright is that there’s rigorous science and verification to say that nutrient reductions that we claim we are achieving and turning into credits is real and valid, [so] that we know that those reductions are legitimate,” Fox says.

But some environmental advocates says the credit trading program is just another ‘pay-to-pollute’ scheme.

“We are trading accountability for unaccountability,” says Food and Water Watch’s Scott Edwards. His group investigated water trading credits in the Ohio River and the Chesapeake Bay. And he says these programs have made it impossible to track exact pollution loads from power plants.

“A power plant has to measure its discharges at the end of the pipe—tak[ing] water samples every month, or every quarter, depending on what their permit says—and report those results,” Edwards says. “I can tell you—or I used to be able to tell you—exactly how much pollution was coming out of a power plant and into a stream.”

Edwards gives the example of the Brunner Island Electric Plant. The plant has a permit from the Pennsylvania Department of Environmental Protection to discharge pollution into the Susquehanna River, which runs into the Chesapeake Bay. Both are officially impaired waterways. But in 2013, for example, Brunner Island used water quality trading credits to offset all of its nitrogen and phosphorous discharges.

“When I look at Brunner Island now, I see that they’ve discharged 87,000 pounds of nitrogen,” Edwards says. “[But] can you prove to me that that those groups of farms that you bought credits from have reduced their discharges by 87,000 pounds? All they can do is hold out their credits that they purchased and say, ‘Here, we bought 87,000 pounds of credits.’ No one will ever know if those farms reduced their load by 87,000 pounds or not.”

Many of those credits paid for projects that hauled away millions of tons of chicken manure from farms in the Chesapeake Bay watershed. That sounds good for water quality in the bay. But Edwards points out that all the manure was trucked to southwestern Pennsylvania—and into the Ohio River watershed. He says that means they didn’t reduce pollution; they just moved it.

WATCH: Ken Merrick Talks About Reducing Farm Runoff

The Pennsylvania Department of Environmental Protection says it regulates how manure is applied to farm fields, although it hasn’t specifically tracked final distribution of the Chesapeake Bay manure. And Edwards says that’s the crux of the issue: There’s no way to test exactly how much pollution is being reduced by mitigation measures, like manure pads or buffer strips on farms.

“No one is ever going to measure whether those thousand of pounds ever were stopped at that farm from entering into a waterway. There’s no monitoring going on, there’s no water sampling going on.”

The difficulty in verifying results on farms led environmental regulators in New York to reject a water credit trading program.

But Jessica Fox, who helps manage the credit trading program in the Ohio River watershed, says they use well-established modeling to estimate pollution reduction on farms. And they work with state regulators to verify annually that the projects are being maintained.

“I go out there,” Fox says. “I can see the projects where there used to be all kinds of sediment and manure running right into the river. There’s no question when you see these projects on the field that nutrient recovery is happening.”

She acknowledges that they can’t exactly measure pollution reduction on a farm the way they can at the end of a pipe. But she says that doesn’t mean there aren’t as many benefits. So far, the program has helped fund projects on more than 30 farms and prevented more than 100,000 pounds of nitrogen and phosphorous from getting into the Ohio River.

Beef farmer Ken Merrick has also witnessed the benefits of the controls he’s put in using the credit trading program. Now, the mud from his farm no longer washes into the water, and his stream has come back to life.

“My wife was actually out here last summer catching fish with the kids,” he says. “My grandpa used to do that. I never caught anything. It’s kind of cool to see the fish coming back into the area.”

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This story is part of our Headwaters series, which explores the environmental and economic importance of the Ohio River. Headwaters is funded by the Benedum Foundation and the Foundation for Pennsylvania Watersheds, and is produced in collaboration with West Virginia Public Broadcasting.