A new law in South Dakota has made it tougher for companies to use eminent domain to build carbon capture pipelines. This law could complicate a major project planned by Summit Carbon Solutions, which aims to construct a 2,500-mile pipeline stretching across five Midwestern states. The project is expected to cost around $8.9 billion and is designed to transport greenhouse gas emissions from over 50 ethanol plants in Iowa, Minnesota, Nebraska, North Dakota, and South Dakota to a storage site in North Dakota.
Governor Larry Rhoden signed the bill into law, which prevents Summit from forcing landowners in South Dakota to allow the pipeline to cross their properties. Despite this setback, Summit has expressed its intention to continue pursuing the project. The company stated that it is exploring all options and plans to move forward in other states where it has received necessary approvals.
Typically, large pipeline projects rely on eminent domain to secure land access. This means that if a few landowners refuse to grant permission, the entire project could be at risk. Summit has already secured over 2,700 easements in the region and has received approvals for routes in Iowa and North Dakota, as well as a segment in Minnesota.
The proposed route for the pipeline goes through nearly 700 miles of South Dakota before entering North Dakota. Rerouting the project to bypass South Dakota and instead go through Minnesota would be a significant challenge. A spokesperson for Summit did not comment on the possibility of a new route.
The bill’s sponsor, Republican Rep. Karla Lems, suggested that Summit could either negotiate with landowners in South Dakota or consider rerouting through Minnesota. Governor Rhoden mentioned that the law was not meant to kill the project but rather to provide Summit with an opportunity to reassess its plans.
For the ethanol industry, this pipeline is crucial. With the shift toward electric vehicles, there is a pressing need for new markets for ethanol, which is a significant part of the corn crop in the Midwest. Ethanol producers are looking to expand into new markets, including aviation fuel, but they need to reduce carbon emissions to qualify for tax incentives.
Walt Wendland, who operates an ethanol plant in South Dakota, expressed concern that this new law could disadvantage local ethanol producers. He emphasized that he simply wants to be treated fairly in a competitive market.
Summit has faced numerous challenges since proposing the pipeline four years ago, including lawsuits and regulatory hurdles. While the company remains optimistic about the future, it has not provided specific details on how it plans to proceed without the authority to use eminent domain in South Dakota. The changing federal stance on climate change and carbon capture, especially under the Biden administration, has also added complexity to the project.
As the situation develops, it remains to be seen whether Summit will be able to overcome these obstacles and successfully build the pipeline.