Skip to content 
What are Water Credits?
Water credits (also called water credits or water Offsets are a market-based mechanism designed to finance projects that improve water quantity, quality, and management in critical watersheds. They allow companies, governments, or individuals to offset their water impact by supporting conservation or restoration initiatives in other areas.
How do they work?
Water improvement project:
- Examples: Reforestation of watersheds, restoration of wetlands, implementation of efficient irrigation systems, wastewater treatment.
- Goals: Recharge aquifers, reduce pollution, improve natural infrastructure,
Quantification
- The volume of improved water is measured ( e.g .: m³ of clean water generated or pollution avoided).
- Baseline: Comparison with the scenario without the project.
Certification
- An independent standard verifies the results and issues credits.
- 1 credit = 1/10/100 m³ of water restored depending on the type of project, saved or clean (depends on the standard).
Standards and certification bodies
Toilet Quality Trading
(USA): Focus on reducing contaminants ( e.g. , phosphorus, nitrogen).
Plan Vivo
Community projects with social co-benefits .
Gold Standard
Includes water metrics in its carbon standards.
Verra
Explore frameworks for water ( e.g. VCS +Water ).
Biocarbon Registry
Biocarbon Registry.
Key benefits
Water security
Improves water availability for communities and ecosystems
Local economy
Reduces water treatment costs for municipalities.
Biodiversity
Restoration of aquatic habitats.
Carbon
Reforestation projects capture CO₂.
Social
Local employment in water management.
Market prices
Variables
$0.50 - $20 USD By CreditFactors:
- Opportunity cost ( e.g. farmers who stop using water to sell credits).
- Ecological value ( e.g. , basins at risk).
Challenges
Future trends
📊 ESG Integration
Companies report their water footprint and purchase credits to offset it.
🛰️ Technology
IoT sensors and satellites for real-time monitoring.
🤝 Partnerships
Private-public sectors to finance natural infrastructure.
Who buys them?
Food/beverage companies
( e.g. Nestlé, PepsiCo).
Mining and energy sector
(high water use).
Governments
to meet sustainability goals.
ESG Investors.
ESG Investors.
Project examples
California (USA) Farmers implement efficient irrigation; they sell credits to cities that need to offset their intensive water use.
Kenya: Reforestation in watersheds to recharge aquifers; loans financed by beverage companies ( e.g. , Coca-Cola).
