A Viable Market for Green Infrastructure?

March 22, 2016
SW_JK

Washington DC has about 43% impervious cover, and the city has a serious CSO problem. Runoff from most of the city flows directly into surrounding rivers and eventually into the much-protected Chesapeake Bay, but about a third of it flows into the combined sewer system, which in past years has experienced as much as 3.2 billion gallons in overflows.

The city has been trying to remedy the CSOs and reduce the volume of stormwater in general, taking two different approaches: one is a large tunnel system to accommodate some of the runoff and reduce peak flows. The other, as in so many other cities, is a green infrastructure approach to retain stormwater onsite, as this article describes.

To accomplish the latter, the District Department of Energy and Environment has set up an aggressive stormwater credit program to encourage developers and others to add rain gardens, swales, permeable pavements, and other GI features throughout the city. Any property—residential, business, church—that installs such features can earn retention credits, and the property owner can then sell those credits to developers who might not have space to install green infrastructure on new projects. The city believes this approach will be more beneficial in the long run than if the developers put all the stormwater controls on their own sites; widely dispersed green infrastructure is expected to capture 57% more runoff than if the retention were concentrated on the 1% of land being developed for large projects, those of 5,000 square feet or more.

It sounds like it should work, but in the three years since the program began, only two credit exchanges have taken place. The problem, the city says, is twofold: lack of demand from developers—although that may change as new projects get going—and lack of money for interested property owners to make the needed improvements to their own properties.

The city is hoping private investors can provide a solution. A new company called District Stormwater LLC is working to put green infrastructure on private property at no cost to the property owners. In turn, the company gets the retention credits and can sell them to developers. The company is beginning to contact property owners in areas where it thinks green infrastructure will provide the most benefit—environmental as well as social—and offering its services. Another upside is that, with the credits concentrated in one place, developers who are in the planning stages of new projects will be able to see more readily how many credits might be available and for how much—a simpler prospect than dealing with multiple individual property owners.

The new company is run by NatureVest, the investment organization of The Nature Consevancy, and by Encourage Capital. Just last week Prudential put $1.7 million into the venture, which it expects to earn back with interest. You can see NatureVest’s description of the effort here.

Are retention credits or something similar available in your area? How successful have they been, and how are long-term inspections and maintenance of the installed stormwater features being handled?

About the Author

Janice Kaspersen

Janice Kaspersen is the former editor of Erosion Control and Stormwater magazines.