Under a cap and trade system, water polluters could have the option to reduce pollution in their own operations or buy water pollution-control or water quality credits from another source at a lower cost than if they undertook the pollution control themselves.

In theory a cap and trade system would achieve the same overall water-quality improvement at a lower overall cost. It would also allow water treatment technology transfer if integrated into a larger global market system.

And such programmes don’t have to be limited to water-quality problems, either. Industries, farmers or cities could also conceivably buy and sell credits for water use, driving down the cost of water conservation and efficiency programmes.
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The holistic effect is to add to the sustainability of the commodity. The general trend in the price of water rights to abstract also has seen some incremental growth. A record was recently achieved in the US of close to $30,000 for an acre foot per year (325,851 US gallons or 1,233.5 kl (or m³) per year) – not bad considering similar rights were trading at $500 five years ago.