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NOTICES

Nutrient and Sediment Reduction Credit Trading Program; Nutrient Trading Program Activities and NPDES Permits

[38 Pa.B. 1887]
[Saturday, April 19, 2008]

   The Department of Environmental Protection (Department) provides notice of the following actions regarding the Nutrient and Sediment Reduction Credit Trading Program (Trading Program). These actions were taken in relation to the Interim Final Policy and Guidelines for Nutrient and Sediment Trading issued in 2005 and the Final Trading of Nutrient and Sediment Reduction Credits--Policy and Guidelines (Policy) (DEP ID# 392-0900-001) (see 36 Pa.B. 7999 (December 30, 2006)). The Policy called for a transparent system of credit reviews and approvals.

   Trading is a market-based program that provides incentives for entities to create nutrient reduction credits by going beyond statutory, regulatory or voluntary obligations and goals by removing nutrients from a watershed. The credits can be traded to help others more cost-effectively meet their obligations or goals. The primary purpose of the Trading Program is to provide for more efficient ways for National Pollutant Discharge Elimination System (NPDES) permittees to meet their effluent limits for nutrients and sediment. Currently, the focus of the program is on the Chesapeake Bay watershed.

   The actions described in this notice relate to: (1) submitted proposals; (2) approved proposals; and (3) registered credits, through March 28, 2008.

Background

   Before a credit can be used by an NPDES permittee, a three-step process is followed. First, the credit or offset proposal must be approved, second, it must be verified and third, it must be registered.

   Approval is also known as certification, which is a written approval by the Department for the use of proposed or implemented activities to generate credits (in some cases the person generating the credits is not permitted to transfer them to another person, in which case they are called ''offsets''). Certifications are based on at least: (1) a credit or offset proposal to be submitted describing the qualifying activities that will reduce the nutrient loadings delivered to the applicable watershed; (2) the calculation to quantify the pounds of reductions expected; and (3) a verification plan that, when implemented, ensures that the qualifying nutrient reduction activities have taken place. All of the proposals, certifications and registrations described in this notice apply to the Chesapeake Bay Watershed.

   Once the credits or offsets are certified, they must be verified. Verification means implementation of the verification plan contained in a certified credit or offset proposal as required by the Department. Verification plans require annual submittal of documentation to the Department that demonstrates that the qualifying nutrient reduction activities have taken place for the applicable compliance year.

   The credits or offsets also need to be registered by the Department before they can be used in an NPDES permit. Registration occurs only after credits or offsets have been certified and verified, and a trading contract for credits has been submitted to the Department. For the Chesapeake Bay Watershed, the Department will register credits on an annual basis for use during the compliance year in which the qualifying nutrient reduction activities have taken place and will provide such credits with an annual registry number for reporting and tracking purposes.

   The Department has received 38 proposals that have been submitted for review to generate nutrient reduction credits in the Chesapeake Bay Watershed. Of those, 27 have been approved, 5 are in review, 1 has been withdrawn and the remaining proposals need additional clarification before they can be considered complete and further reviewed for certification.

Proposals under Review

   The following proposals are being reviewed by the Department.

Proposal Applicant Proposal Description
1. The ARRO Group, Inc. Land Conversion for proposed Mirage Subdivision, Adams County
2. The ARRO Group, Inc. Land Conversion for proposed Biglerville Crossing II and Summerdale Crossing II, Adams County
3. Mavickar Environmental Consultants Land Conversion for proposed Bethel Warehouse, Berks County
4. Chester County Conservation District Nitrogen credits generated by cover crops, Chester County
5. Bion Environmental Technologies, Inc. Nitrogen and Phosphorous credits generated by a proprietary livestock waste treatment technology for a flush dairy operation, Lancaster County

Certifications:

   The Department has approved the following credit-generating proposals.

Applicant and proposal description
Nitrogen Credits Phosphorus Credits Sediment Credits
1. HRG/Milton Regional Authority--Facility generated credits through the process/treatment of the wastewater. These credits may be revised once the facility receives their final NPDES permit.  
46,000
 
6,000
 
2. Red Barn Trading Company--Poultry Manure Export from Snyder County to location outside of the watershed.  
24,405
 
3,051
 
3. Red Barn Trading Company--Poultry Manure Export from Union County to location outside of the watershed.  
10,525
 
1,317
 
4. Red Barn Trading Company--Poultry Manure Export from Snyder County to location outside of the watershed.  
11,050
 
1,381
 
5. Red Barn Trading Company--Poultry Manure Export from Snyder County to location outside of the watershed.  
15,621
 
1,953
 
6. Red Barn Trading Company--Poultry Manure Export from Schuylkill County to location outside of the watershed.  
21,141
 
2,643
 
7. Red Barn Trading Company--Poultry Manure Export from Juniata County to location outside of the watershed.  
8,246
 
1,031
 
8. Red Barn Trading Company--Poultry Manure Export from Huntington County to location outside of the watershed.  
9,036
 
1,130
 
9. Red Barn Trading Company--Poultry Manure Export from Juniata County to location outside of the watershed.  
11,154
 
1,394
 
10. Red Barn Trading Company--Poultry Manure Export from Franklin County to location outside of the watershed.  
68,122
 
8,515
 
11. Red Barn Trading Company--Poultry Manure Export from Juniata County to location outside of the watershed.  
9,243
 
1,155
 
12. Red Barn Trading Company--Poultry Manure Export from Lancaster County to location outside of the watershed.  
36,679
 
4,585
 
13. Red Barn Trading Company--Poultry Manure Export from Lancaster County to location outside of the watershed.  
14,269
 
1,784
 
14. Red Barn Trading Company--Poultry Manure Export from Lebanon County to location outside of the watershed.  
55,387
 
6,923
 
15. Red Barn Trading Company--Poultry Manure Export from York County to location outside of the watershed.  
22,860
 
2,857
 
16. Red Barn Trading Company--Poultry Manure Export from Lancaster County to location outside of the watershed.  
12,344
 
1,543
 
17. Red Barn Trading Company--Poultry Manure Export from Perry County to location outside of the watershed.  
17,319
 
2,165
 
18. Red Barn Trading Company--Poultry Manure Export from Adams County to location outside of the watershed.  
24,724
 
3,090
 
19. Red Barn Trading Company--Poultry Manure Export from Juniata County to location outside of the watershed.  
6,671
 
834
 
20. Red Barn Trading Company--Poultry Manure Export from Lancaster County to location outside of the watershed.  
7,054
 
882
 
21. Red Barn Trading Company--Poultry Manure Export from Lancaster County to location outside of the watershed.  
7,699
 
962
 
22. Red Barn Trading Company--Poultry Manure Export from Lancaster County to location outside of the watershed.  
15,624
 
1,953
 
23. Mount Joy Borough Authority--Continuous No--till on 930 acres.  
11,718
  
24. Berks County Conservation District--Cover crops planted on ten tracts of land, credits were generated during the 2006-2007 water year.  
1,851
  
25. Chesapeake Nutrient Management--Poultry manure export from Adams County to a location outside of the watershed, credits were generated during the 2006-2007 water year.  
6,236
 
780
 
26. Lititz Run Watershed Association--Stream restoration project; credits are nontransferable. 1,381 68 129
27. Berks County Conservation District--Cover crops planted on forty-four tracts of land, credits have been generated for the 2007-2008 compliance year.  
7,834
  
   Total: 484,193 57,996 129

   The Department has also given conditional approval to Bion Environmental Technologies, Inc., for calculating credits, related to a proprietary livestock waste treatment technology for flush dairy operations.

Verifications and Registrations:

   To date, there are no verifications and registrations.

Future notices:

   In the future, the Department plans to provide notice in the Pennsylvania Bulletin at three separate times during the Trading Program.

   First, notice will be provided when a complete proposal to generate credits or offsets has been received. All submitted proposals will be reviewed for technical feasibility, consistency with the Department's Trading Program, and legal and policy requirements.

   Second, upon approval of a proposal (certification), the Department will provide notice in the Pennsylvania Bulletin of the proposal details including the generation method and number of credits or offsets to be certified. This notice will include the chance for informal public input into the certification decisions.

   Finally, the Department will also provide notice in the Pennsylvania Bulletin when the credits and offsets have been verified and registered.

   For further information about the previous information or the Department's Nutrient Trading Program, contact Ann Smith, Water Planning Office, P. O. Box 2063, Harrisburg, PA 17105-2063, (717) 787-4726, annsmith@state.pa.us or visit the Department's web site at www.depweb.state.pa.us (DEP Keywords: ''Nutrient Trading'').

KATHLEEN A. MCGINTY,   
Secretary

[Pa.B. Doc. No. 08-740. Filed for public inspection April 18, 2008, 9:00 a.m.]



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