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Nitrogen Trading in Lake Taupo: An Analysis and Evaluation of an Innovative Water Management Strategy


  • Duhon, Madeline
  • Young, Justine
  • Kerr, Suzi


This paper provides a concise introduction to and evaluation of the Lake Taupo nitrogen cap and trade program established as part of Waikato Regional Council's recent Regional Plan Variation Five. The policy establishes a catchment-wide cap on nitrogen losses by allocating farmers individual nitrogen discharge allowances and allowing those farmers flexibility to trade allowances amongst themselves and to sell allowances to a public fund while remaining within the overall catchment cap. This paper seeks to explain the structure and evolution of the nitrogen trading market and to analyse its impact thus far by drawing on a wide variety of relevant perspectives. Research drawn from written material and basic quantitative data provide the basis for analysing the policy, while interviews with relevant stakeholders provide insight into the successful, surprising and contentious issues which arose throughout its development and implementation.

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  • Duhon, Madeline & Young, Justine & Kerr, Suzi, 2011. "Nitrogen Trading in Lake Taupo: An Analysis and Evaluation of an Innovative Water Management Strategy," 2011 Conference, August 25-26, 2011, Nelson, New Zealand 115353, New Zealand Agricultural and Resource Economics Society.
  • Handle: RePEc:ags:nzar11:115353

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    References listed on IDEAS

    1. Anna Strutt & Allan N. Rae, 2011. "Modelling the Impact of Policies to Reduce Environmental Impacts in the New Zealand Dairy Sector," Working Papers in Economics 11/04, University of Waikato.
    2. Tee, James & Scarpa, Riccardo & Marsh, Dan & Guthrie, Graeme, 2011. "Climate Change Mitigation Policy: The Effect of the New Zealand Emissions Trading Scheme on New Radiata Pine Forest Plantations in New Zealand," 2011 Conference (55th), February 8-11, 2011, Melbourne, Australia 100703, Australian Agricultural and Resource Economics Society.
    3. Johansson, Robert & Peters, Mark & House, Robert, 2007. "Regional Environment and Agriculture Programming Model," Technical Bulletins 184314, United States Department of Agriculture, Economic Research Service.
    4. Suzi Kerr & Wei Zhang, 2009. "Allocation of New Zealand Units within Agriculture in the New Zealand Emissions Trading System," Working Papers 09_16, Motu Economic and Public Policy Research.
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    Cited by:

    1. Yao, Richard T. & Harrison, Duncan R. & Velarde, Sandra J. & Barry, Luke E., 2016. "Validation and enhancement of a spatial economic tool for assessing ecosystem services provided by planted forests," Forest Policy and Economics, Elsevier, vol. 72(C), pages 122-131.
    2. Doole, Graeme J. & Kingwell, Ross, 2015. "Efficient economic and environmental management of pastoral systems: Theory and application," Agricultural Systems, Elsevier, vol. 133(C), pages 73-84.

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    Environmental Economics and Policy; Land Economics/Use;

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