Credit Generation Requirements

Request submissions are logged in and processed in the order they are received. See the Credit Trading Process page for more details on the request submission process.

To ensure processing can be completed in time for credits to be sold and applied to permit limits no later than the November 28th Chesapeake Bay annual DMR submission deadline, submit complete requests for compliance year 2025 (10/1/24 – 9/30/25) electronically to the Nutrient Credit Trading Program email (RA-EPPANutrientTrad@pa.gov) by the following dates:

• Certification Requests: Monday, April 7, 2025
• Verification Requests: Friday, October 31, 2025
• Registration Requests: Friday, November 14, 2025

Due to the Thanksgiving holiday, requests for Compliance Year 2025 must be received by midnight, November 21, 2025, to be accepted and processed.

The Department of Environmental Protection (DEP)  issued an interim Final Trading Policy in October of 2005, which was finalized in November of 2006. This policy was the basis for the development of the Nutrient Credit Trading Program (Trading Program).

On October 9, 2010, DEP issued requirements for participation in Program regulations titled "Use of offsets and trdable credits from pollution reduction activities in the Chesapeake Bay Watershed" (25 Pa. Code § 96.8) in the Pennsylvania Bulletin (40 Pa. B. 5790).

In April 2014, the U. S. Environmental Protection Agency (EPA) began objecting to the issuance of NPDES permits prepared by DEP that contained annual mass load effluent limitations ("cap loads") and permit language that enabled the use of credits to achieve compliance with those cap loads.

The objections were based on EPA's concerns with the nonpoint source agricultural baseline requirements in the nutrient trading regulations. EPA asserted that DEP had not made a quantitative demonstration that these requirements achieve the load allocations for agricultural sources in the Chesapeake Bay Total Maximum Daily Load (TMDL).

Unlike point source discharges with NPDES permits, agricultural operations cannot quantitatively measure the potential nonpoint source loading of nutrients from their fields.

To resolve EPA's objections and retain the ability to issue the NPDES permits in question, DEP has established additional eligibility and credit calculation requirements to ensure the effectiveness of the use of credits to meet legal requirements of the Chesapeake Bay TMDL as authorized by its regulations (25 Pa. Code §§ 96.8(d)(5) & (e)(3)(vi)).

Further details on these requirements and how a credit generator can comply with these new provisions can be found in the Phase 3 Watershed Implementation Plan (WIP) Nutrient Trading Supplement (PDF).

A summary of the changes as they impact Point Source Credit Generators and Nonpoint Source Credit Generators is below.

Point Source (PS) facilities are authorized to utilize offsets and credits for compliance purposes through specific language in their NPDES permit.

To generate credits, PS generators must be a significant sewage PS discharge within the Chesapeake Bay Watershed with annual mass load effluent limitations ("cap loads") in an NPDES permit listed in the Point Source Credit Generators Table (Table 5 of the Phase 3 Watershed Implementation Plan (WIP) Wastewater Supplement (PDF)).

Requirements for increased sampling frequency and the use of offsets as credits for compliance purposes are further explained in the Phase 3 Watershed Implementation Plan (WIP) Wastewater Supplement (PDF).

PS generators must also demonstrate compliance with requirements during the Compliance Year in accordance with procedures as further explained in the Phase 3 WIP Nutrient Trading Supplement (PDF), including:

• PS generators must be able to demonstrate that they are in compliance with their NPDES permit.
• Where effluent limitations for TN and/or TP are established in Part A of the permit for reasons other than the cap load assigned for protection of the Chesapeake Bay ("local nutrient limits"), PS generators must demonstrate that these effluent limitations have been achieved.
• PS generators must demonstrate treated effluent concentrations below 6 mg/L Total Nitrogen (TN) and 0.8 mg/L Total Phosphorus (TP) (i.e. "baseline concentrations").
• The calculation of credits for PS generators will be made using the formulas described in the Phase 3 WIP Nutrient Trading Supplement, which supersedes any previous WIP Nutrient Trading Supplements.
• The total amount of credits a PS generator is certified to generate cannot exceed its permitted cap load.

On October 1, 2022, DEP published notice of the current mass certification of significant sewage PS pollutant reduction activities in the Pennsylvania Bulletin to establish the procedures for point sources to generate and trade credits. This PS mass certification will expire September 30, 2027.

There are three types of Nonpoint Source (NPS) pollutant reduction activities (PRAs) that have generated credits in Pennsylvania:

• Agricultural best management practices (BMPs)
• Manure nutrient destruction and conversion technologies
• The export of poultry manure (litter) and agricultural application outside of the Chesapeake Bay watershed

Other NPS PRAs may be eligible to generate credits. Email the Nutrient Credit Trading Program (RA-EPPANutrientTrad@pa.gov) for more information.

On August 13, 2022, DEP published notice in the Pennsylvania Bulletin that the Chesapeake Bay Nutrient Tracking Tool (CBNTT) was approved for use by the Nutrient Credit Trading Program (Trading Program) for calculation of NPS nutrient credits. CBNTT is an EPA and regionally accepted credit calculation and tracking tool. The main changes to the existing Trading Program with the use of CBNTT as they relate to NPS credit generators are:

1. All NPS credit generators must use CBNTT to calculate credit generation.
2. Adjustments have been made to the credit calculation methodology by approving the use of the CBNTT. The use of the CBNTT will increase consistency of calculation methodology, as well as update that methodology to the current Phase 6 of the Chesapeake Bay Watershed Model.
3. The delivery ratios that all NPS generators must use will be automatically calculated using CBNTT.
4. With the implementation of CBNTT, the increased efficiency in calculating nutrient and sediment losses will result in a decreased uncertainty ratio of 2:1 (compared to the previous 3:1 uncertainty ratio). Note: the 2:1 uncertainty ratio and the 10% credit reserve is not included in the automatic calculations and must still be applied to the credit values calculated from CBNTT.

In order to be eligible to generate and sell credits, potential NPS credit generators must request credit certification using the process described in further detail on the Credit Trading Process webpage. NPS certifications, once approved, will generally be valid for a period of up to 5 years.

To be eligible to generate credits, NPS PRAs must be in compliance with the following rules and regulations, as applicable:

• 25 Pa. Code Chapter 102, Erosion and Sedimentation Control Regulations
  All plowing and tilling activities must implement and maintain BMPs to minimize the potential for accelerated erosion and sedimentation. Written erosion and sedimentation control plans are required for agricultural plowing or tilling or animal heavy use areas that disturb 5,000 square feet or more.
  
  
• 25 Pa. Code Section 91.36
  These regulations define pollution control and prevention requirements at agricultural operations, including requirements related to land application of animal manure.
  
  
• 25 Pa. Code Section 92a.29
  These regulations define the requirements for Concentrated Animal Feeding Operations (CAFOs) with NPDES permits.
  
  
• 25 Pa. Code Chapter 83, Subchapter D
  These regulations promulgated by the State Conservation Commission define and regulate Concentrated Animal Operations (CAOs) through the development and implementation of Nutrient Management Plans.

In addition, one of the following conditions must be met at the location of NPS credit generation:

• Manure is not mechanically applied within 100 feet of a perennial or intermittent stream with a defined bed or bank, a lake, or a pond, and a commercial fertilizer is applied at or below appropriate agronomic rates.
  
  
• A minimum of 35 feet of permanent vegetation is established and maintained between the field and any perennial or intermittent stream with a defined bed or bank, a lake, or a pond. The area may be grazed of cropped under a specific management plan provided that permanent vegetation is maintained at all times and there is no mechanical application of manure within the buffer area.
  
  
• The applicant applies an increase of at least 20% to the overall amount of pollution reduction generated by the PRA.

In addition to the regulatory and threshold requirements identified above, to generate credits from the hauling of poultry manure, the poultry manure must be applied to a site outside of the Chesapeake Bay watershed that is nutrient deficient in accordance with a nutrient management plan or nutrient balance sheet completed by a certified nutrient planner. The application of commercial fertilizer to the site where the poultry manure is removed must be tracked and documented. An additional 2:1 trading ratio will be applied to the final number of credits generated.

For manure destruction and conversion technologies, eligibility will be determined based upon a thorough review of the individual technology, and, at a minimum, compliance with all local, state, and federal requirements. If the number of credits generated will be verified using a comprehensive sampling and monitoring protocol, where actual reductions in nutrients can be measured and verified, no additional adjustment may be necessary. However, if it is determined during the technical review of the verification plan that the sampling and monitoring protocols are not sufficient to ensure consistency with defined Chesapeake Bay Program protocols, additional adjustments may be applied.

For further information, contact:

Nutrient Credit Trading Program
Department of Environmental Protection
Bureau of Clean Water - Division of Data Management
RCSOB, P.O. Box 8774
Harrisburg, PA 17105
(717) 787-6744
RA-EPPANutrientTrad@pa.gov