1. Agflex Inc.
1/13/04
Agriculture and Water Quality Credit Trading in Minnesota: Emerging Opportunities
Presentation delivered by
Thomas A. Green, President, IPM Institute and Agflex
(608) , Fax (608)
2004 USDA CSREES Water Quality Conference
January 13, 2004
Clearwater, Florida
Brian Brandt – Director of Risk Management Programs
American Farmland Trust – Agricultural Conservation Innovation Center
1914 Rowley Ave, Madison WI (608) 1

2. New MN Trading Project
Starting It Local: Transferable Market Infrastructure for Trading Water Quality Credits & Ecosystem Services in the Upper Mississippi River Basin
$1 million of USDA CIG funding
Project led by Minnesota River Board

3. Project Objectives
Create self-sustainable local infrastructure and support systems that facilitate ag participation in water quality trading and other ecosystem services markets
Define, test and establish transferable approaches using trusted and established local watershed institutions to promote ecosystem service markets
Create example market structures and protocols and capture in transferable templates for other UMRB applications

4. Target Locations Sauk River Watershed
The Lower and Middle Minnesota River
The Greater Blue Earth River Basin

5. Primary Market Drivers
WQCT due to expected credit demand stemming from forthcoming restrictions on restrictions on wastewater dischargers in the selected watersheds
Renewable biomass energy production
GHG markets
Source water protection

6. WQCT Drivers in the Sauk River Basin
Horseshoe Chain of Lakes TMDL for phosphorus over-enrichment
Drinking water/source water protection
Lake Pepin TMDL for all sub-watersheds downstream of Horseshoe Chain of Lakes

7. Supportive Conditions for WQCT in Middle and Lower Minnesota Basin
Three existing WQCT permits
Localized relief via WQCT for new or expanding permits for downstream Lake Pepin TMDL
Dakota Energy’s pending 2008 energy facility that will use steam from Rahr Malting’s bio-mass fueled plant
Food producers and cooperatives for sweet corn, sweet peas, sugar beets and ethanol form natural networks that can assist in the aggregation of agricultural credits

8. Sauk River Watershed Water Quality Trading Project
AFT is coordinating a project in the Sauk River Watershed in MN
Partnering with Stearns County SWCD, Sauk River Watershed District and Kieser & Associates
First multiple credit trading project in U.S.

9. Organization Chart (Big Picture)
Wetland
Banking
Greenhouse
Gas Market
Water Quality
Trading
Habitat
Buyer of Credits
Ecoservices
Project
Generator of
Credits

10. Organization Chart (continued)
Policy Committee
Aggregator
(Sauk River WD)
Technical Committee
(Stearns County SWCD)
Credit Certifiers
(SWCD, CCC, TSP, Eng.)
Credit Generators
(farmers, foresters, urban)

11. Organization Chart (Who)
Policy Committee
Aggregator
(Sauk River WD Chair)
Technical Committee
(Stearns SWCD Chair)
Board Member (1 each)
SRWD
Stearns SWCD
Aggregator Chair
Tech Com. Chair
Buyer Rep.
Generator Rep.
Ag Consultant
Sauk River WD Chair
Ag Representative
City Representative
American Farmland Trust
NRCS
Rural Water Association
Stearns SWCD Chair
NRCS
U of MN
Ag Consultant
Sauk River WD
Board of Soil and Water Resorces
St. Cloud St. University
Kieser & Associates (technical consultant)

12. Roles & Responsibilities Policy Committee
Approve bylaws
Approve protocols/methods
Set watershed goals
Review fiscal performance
Provide forum for public participation
Leverage state and federal influence

13. Roles & Responsibilities Aggregator
National bench marking report
Market base analysis report
Facilitate vertical communication of project
Coordinate with buyers & ecoservice programs
Facilitate standard method protocols and recommendations with Tech Committee, for Policy Committee
Trade registry development and operation
Market and administrate program
Monitoring of water resources

14. Roles & Responsibilities Technical Committee
Provide technical input on standard methods
Credit estimation process
Watershed management
Perform audit of BMP program
Review of applications for accuracy
Develop and deliver training materials
Assist with ecoservices integration among multiple programs
Certification protocol development
Monitoring of BMP site for effectiveness

15. Contact Us
For more information please contact Brian Brandt at or at