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Nutrient Trading in Lake Rotorua: Overview of a Prototype System
Abstract
Please note: this paper has been updated as Motu Note #10.
Water quality in Lake Rotorua has been declining for at least the last 30 years as increased levels of nutrients have entered the lake. Despite significant effort and expenditure, the level of nutrients entering the lake still exceeds sustainable levels. A nutrient trading system would help the catchment achieve this goal at least cost. Nutrient sources would bear the cost of their impact on water quality and hence take these costs into account in their decision-making. If the community decides to achieve its environmental goals using a nutrient trading scheme, this paper presents a scheme that would achieve nutrient loss reductions for the Lake Rotorua catchment cost effectively, whilst maximising participant flexibility and environmental certainty. This paper updates an earlier version by Suzi Kerr and Kelly Lock, published in 2008 as Motu Working Paper 08-02.
Citation
Kerr, Suzi, and Hugh McDonald. 2011. "Nutrient Trading in Lake Rotorua: Overview of a Prototype System," draft paper.
Motu code: MYS2011
JEL codes: