Giant pipeline in US Midwest tests future of carbon capture

Nov. 23 (Reuters) – Dan Tronchetti received a letter in August that alarmed him: Summit Carbon Solutions, a company he had never heard of, wanted his permission to conduct survey work for a 2-hour pipeline. 000 miles that she planned to drive through her Iowa. corn and soybean fields.

The project, dubbed the Midwest Carbon Express, had the ambition to become the world’s largest carbon dioxide pipeline, moving climate-warming greenhouse gases from biofuel plants in the Midwest to North Dakota for storage. permanent underground.

But Tronchetti’s first concern was his livelihood. “It would cross over half a mile through prime farmland,” he said.

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The 65-year-old is among dozens of landowners along the road who refuse to hand over their property to the project, according to Reuters interviews with five landowners, four community groups organizing the opposition, several academics and sources of justice. industry as well as a review of files with state regulators.

The stalemate could escalate into potential court battles if Summit attempts to seize the territory by claiming a prominent domain. These legal struggles contributed to the cancellation of the Keystone XL pipeline this year.

The outcome of the dispute poses huge stakes for Summit’s $ 4.5 billion project, and for Midwestern ethanol producers who hope to erase their carbon footprint and restore their environmental footprint.

It also represents what could be the biggest test yet for the carbon capture and storage (CCS) industry, which has struggled for years but which advocates say could become a powerful tool in the fight. global campaign against climate change.

Underground geological formations in the United States have the potential to store 2.6 trillion tonnes of global warming CO2, enough to cover all of America’s historic emissions and those to come for centuries, according to the Department of the United States. ‘Energy.

But there are open questions as to whether CCS can ever fulfill them. Despite billions of dollars in public investment over the past decade, the technology remains relatively untested.

The United States has only 12 operational commercial CCS facilities which together have an annual capacity to store 19.64 million tonnes of carbon, or about 0.4% of national emissions.

Many other projects have been proposed but failed to get off the ground or have been put on hold due to financial or operational issues, most notably the $ 1 billion Petra Nova plant in Texas last year.

Health issues are also a concern. A 2020 liquid CO2 pipeline rupture in Yazoo County, Mississippi, for example, left dozens of people sick.

Jerald Schnoor, a professor at the University of Iowa School of Engineering and former chairman of the Iowa Climate Change Advisory Council, said his “high hopes” for the CSC had faltered in recent years after the series of failed projects.

But he added that ethanol plants were theoretically prime sites for carbon capture, as they produce a highly concentrated CO2 stream.

“If you accept that climate change is a serious problem, and I do, then this great opportunity to capture CO2 makes sense,” he added.

Summit told Reuters that its proposed pipeline will work, be safe and help the agriculture industry by providing a vital new source of income for the 31 corn ethanol plants that have signed with the company.

“This is a transformative enough project for ethanol to be competitive in a low-carbon world,” said Justin Kirchhoff, president of Summit Ag Investors, the parent company of Summit Carbon Solutions.

The Biden administration is also pushing the technology in its attempt to decarbonise the U.S. economy by 2050 and has proposed a sharp increase in tax credits for its use, which is currently being debated in Congress. Summit would be a big beneficiary.

FEAR OF CROP DAMAGE

Summit first offered the Midwest Carbon Express in February and has been working hard to get its route approved in the five states it will pass through.

Iowa, where state law required Summit to hold public hearings in almost all counties, has become the most controversial.

Farmers across the state have spoken out against the project at these meetings, and several, including Tronchetti, are asking the Iowa Utilities Board to release the names of other landowners along the route so they can s ‘to organise.

Summit is fighting the effort, according to a Reuters review of the case, arguing that publication of the list would give its competitors an advantage.

Farmers on the pipeline route are primarily concerned about damage to their crops during and after the line is installed, when the soil will be disturbed and compacted.

Research published by Iowa State University this month found that first and second year yields in the neighboring Dakota Access pipeline right-of-way were 25 percent lower for soybeans and 15 percent lower for corn.

Summit said in a filing with Iowa regulators that it plans to compensate farmers for potential damage by paying them the full value of crops typically grown on the affected area in the first year of construction and d ‘operation, with decreasing payments over the next two years.

Landowners fear that if they refuse to sign voluntary agreements for Summit to use their land for the pipeline, they could take it under eminent domain laws, as has happened with some pipeline and pipeline projects. gas pipelines.

Despite the risk, Tronchetti and Bev Kutz, a Nebraska cattle rancher on the way to the pipeline, told Reuters that they and their neighbors refused to let Summit surveyors enter their property.

“This is a private company that is looking for something that is not in the best interest of the public,” Kutz said.

The project is also facing opposition from some local green groups, such as the Iowa chapters of the Sierra Club and Food & Water Watch, who have expressed safety fears and concerns that the project will be used for enhanced oil recovery (EOR).

Most existing CCS projects use EOR, where the captured carbon is used to increase pressure in oil fields to increase crude production, which climate activists say undermines the green goals of the technology.

Summit said it hasn’t ruled out EOR, but its main focus is permanent storage.

The company declined to tell Reuters what part of the pipeline route it was able to secure from landowners, but said it was optimistic.

“We are encouraged by the response we have received from landowners and look forward to continuing these conversations,” said spokesperson Jesse Harris.

GRANTS AND CREDITS

CCS has been slow to go around the world. According to the Global CCS Institute, there are only 27 commercial CCS facilities operational in the world, with a capacity of around 2 million tonnes per year in the main Chinese emitter.

The Midwest Carbon Express, with the capacity to carry 12 million tonnes of CO2 per year, would overtake the largest current project, the Century natural gas plant in Texas, which can capture some 8 million tonnes of CO2 per year.

Summit’s financial model relies on federal grants for CCS, as well as proceeds from low-carbon fuel credits generated by biofuels from the factories it serves.

The Biden administration’s federal budget reconciliation bill, if passed, would increase carbon sequestration tax credits from $ 50 per tonne of carbon to $ 85 per tonne.

Summit estimated that the pipeline will eventually transport 12 million tonnes of CO2 each year from ethanol facilities, enough to generate $ 1 billion per year in tax credits at the highest rate.

Fuel from the power plants could then be sold to states like California or Washington that have or are developing low-carbon fuel markets, generating lucrative tradable credits.

All of that money could become an important source of revenue for the ethanol industry, which has leveled off in recent years.

But pipeline support for the ethanol industry falls flat with some environmentalists, who criticize the company for moving millions of acres of pasture, unused cropland and forests to corn production.

“We are marrying two highly polluting forms of energy in this dance of death,” said Mitch Jones, political director of Food & Water Watch, of ethanol and crude oil obtained through EOR.

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Written by Leah Douglas; Editing by Richard Valdmanis and Pravin Char

Our Standards: Thomson Reuters Trust Principles.

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