Advocacy group estimates carbon capture pipelines crossing Iowa will get $23 billion at public expense

Source: By Donnelle Eller, Des Moines Register • Posted: Sunday, April 10, 2022

Three proposed carbon capture pipelines in Iowa could receive $23 billion in federal tax credits over a dozen years, a national environmental group estimates, while local communities are left to “foot the bill should anything go wrong.”

“Carbon capture and its associated pipelines are designed to funnel wealth from communities to corporations,” Emma Schmit, an organizer for advocacy group Food & Water Watch in Iowa, said in a statement. “But Iowans see these schemes for what they are — greenwashing and corporate profiteering at our expense.”

Summit Carbon Solution, Navigator CO2 Ventures and Archer-Daniels-Midland have proposed building underground pipelines to capture carbon dioxide from ethanol plants, liquefy it under pressure, then transport it to locations in North Dakota and Illinois, where it would be sequestered a mile underground.

The companies say the projects will help ethanol and other energy-intensive agricultural industries remain viable as the nation seeks to cut net greenhouse emissions in half by 2030 to address climate change.

Countries will not get to their climate change goals “without carbon management technologies,” said Madelyn Morrison, a spokeswoman for the Carbon Capture Coalition, a group that includes utilities, coal producers and other industries, as well as some environmental groups and unions.

But other environmental groups, including Food & Water Watch, say early carbon capture projects have failed to deliver significant climate benefits, and that any leak from a pipeline could pose a safety threat. High carbon dioxide concentrations can cause illness and asphyxiation.

The groups say the federal carbon capture tax incentives should be spent on development of wind, solar and other non-carbon energy sources.

Summit defends plans, say benefits will remain local

Summit, an Ames company spun off from the Bruce Rastetter-owned Summit Agricultural Group, says its $4.5 billion pipeline will create thousands of construction jobs, generate local property tax revenue and provide opportunities for rural suppliers in the five states where the pipeline would be built.

“Regardless of the misinformation special interest groups continue to spread about Summit Carbon Solutions’ project, the facts remain. Summit’s project will have a positive impact across its five-state footprint,” the company said in a statement this week.

Summit proposes to build its 2,000-mile pipeline through Iowa, Minnesota, Nebraska, South Dakota, ending in North Dakota, where it expects to sequester an estimated 12 million metric tons of carbon annually.

Food & Water Watch said Summit, the first of the pipeline planners to asked the Iowa Utilities Board for a permit, could qualify for nearly twice the cost of its project, snagging more than $7 billion in federal tax credits over 12 years.

Summit has estimated the project would qualify for $50 for every ton of carbon that’s sequestered, although the incentive can reach $60. Congress is considering pushing it to $85 a ton and making it payable directly to companies sequestering carbon, among other changes.

Food & Water Watch said Congress has already provided about $12 billion in carbon capture spending through the $1.2 trillion infrastructure law President Joe Biden signed in November.

Increasing the carbon capture tax credits, which are part of this year’s budget discussion, would cost about $2 billion, said Morrison, the Carbon Capture Coalition spokeswoman.

Navigator says tax credits needed to promote new technology

Texas-based Navigator said in a statement that the federal tax credits are needed to help drive adoption of the new technology. And the tax benefits — and higher biofuel premiums — tied with $3 billion project will remain with the local biofuels plants.

Ethanol plants that use the carbon capture technology can get high prices their fuel in California and other markets that have a low-carbon fuel standard. It’s “the participating plants, not Navigator,” that will receive the “economic benefits of decarbonization,’ Navigator said.

It said its $3 billion project could eventually sequester up to 15 million tons of carbon annually in Illinois The 1,300-mile pipeline, which would include 900 miles in Iowa, also would reach into Nebraska, Minnesota and South Dakota.

Chicago-based ADM, partnering with Denver-based Wolf Carbon, proposes capturing carbon from ADM plants in Cedar Rapids and Clinton and sequestering it in Illinois.

The companies haven’t specified their expected investment in the project.

Many Iowa landowners and farmers have expressed concern about the companies’ likely use of eminent domain to force unwilling property owners to sell easement rights. The companies have said they hope to get most easements through voluntary agreements.

“We refuse to also offer up our land, communities, health and safety so that corporations like Summit can make a quick buck,” Schmit said.

Donnelle Eller covers agriculture, the environment and energy for the Register. Reach her at deller@registermedia.com or 515-284-8457. 

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