Midwestern carbon dioxide pipeline project gets approval in Iowa, but still has a long way to go

Iowa public utility regulators on Tuesday approved a controversial carbon dioxide pipeline for transporting emissions of the climate-warming greenhouse gas for storage underground in a win for Summit Carbon Solutions' project after setbacks in other states and opposition from landowners around the Midwest.

The company still has many hoops to jump through before it can begin building in Iowa, including gaining other states' approval.

The $5.5 billion, 2,500-mile (4,023.36 kilometers) pipeline network would carry planet-warming CO2 emissions, liquefied under pressure, from more than 50 ethanol plants in Iowa, Minnesota, Nebraska, North Dakota and South Dakota to be stored deep underground in central North Dakota.

Farmers and the ethanol industry see the pipeline as a way to qualify for federal tax breaks they see as key for growing a market for a cleaner-burning aviation fuel. Corn is among the top two crops in the Midwest, and Iowa is the leader in corn and ethanol production.

“Whether you think it’s smart or silly, the world’s largest airlines want to decarbonize their fuel. Carbon capture and sequestration gets Iowa ethanol into that market, potentially providing a generational boost to Iowa’s economy," Iowa Renewable Fuels Association Executive Director Monte Shaw said in a statement.

Summit CEO Lee Blank welcomed the decision in a statement.

The project's opponents, including many landowners, fear their land will be taken for the pipeline and that a potential pipeline rupture could release dangerous CO2 gas. A coalition opposing Summit's project vowed to fight the Iowa board's decision.

Landowner attorney Brian Jorde said the decision was expected, with a lengthy process for Summit still ahead, such as applying in South Dakota.

“It's just one small thing in a maze, in a track-and-field event full of hurdles that they have to get over,” Jorde said.

The Iowa Utilities Board approved Summit’s January 2022 application for a permit to build and operate the pipeline. But before the board issues the permit, the company must file proof of an insurance policy of at least $100 million to pay for any damages resulting from the pipeline project. Summit must provide proof of the insurance annually.

The company also can't start construction until it has approvals from North Dakota and South Dakota, including for routes in both states and underground storage in North Dakota. Summit also needs approvals from Minnesota and in Nebraska before it can begin to build lines out to ethanol plants in those states.

The Iowa regulators' decision comes after hearings last year and setbacks in other states. North Dakota regulators denied a siting permit in August, but later agreed to reconsider. Hearings on the underground storage proposal were held earlier this month.

South Dakota regulators denied Summit's application in September; Summit said it plans to file again in early July. In Nebraska, where Summit must work with individual counties, at least one county has denied a permit.

The Iowa panel also granted the company the right of eminent domain over numerous parcels of land, but only after the permit is issued. The extent of Summit's eminent domain powers wasn't immediately clear from the 500-page order. The board denied use of some parcels of land; others require modifications to the route. Eminent domain is the taking of private land for public use with compensation for landowners.

The order also includes numerous other requirements of Summit, such as monthly construction reports and grants for equipment for cities and counties to respond to incidents.

Supporters view carbon capture projects such as Summit's as a combatant of climate change, with new federal tax incentives and billions from Congress for such carbon capture efforts. Opponents question the technology's effectiveness at scale and the need for potentially huge investments over cheaper renewable energy sources.

Companies behind two other CO2 pipeline projects proposed in the Midwest have canceled or shelved their plans. From the renewable fuels industry perspective, blows to projects such as Summit's could put at risk the huge potential of a new aviation fuel market the industry believes would continue for many years.

North Dakota Republican Gov. Doug Burgum supports the pipeline. He has hailed North Dakota's underground rock formations as a “geologic jackpot” for CO2 storage potential. In 2021, he set a goal for North Dakota to become carbon neutral by 2030. He isn't seeking reelection this year, and is a top choice to be former President Donald Trump's running mate.

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Dura reported from Bismarck, North Dakota.