Biggest Carbon Capture Project Ever Faced with Midwestern Opposition

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What is billed as the world’s largest carbon capture and sequestration project faces headwinds from farmers and environmentalists even as John Deere & Co. and New York financiers are investing in the $ 4.5 billion company.

The Midwest Carbon Express is a 2,000 mile privately funded pipeline system. It will collect carbon dioxide emissions from dozens of ethanol plants in the Midwest and inject the emissions into porous rock underground in North Dakota, where project supporters say the emissions will be trapped forever.

The effort will safely store up to 10 million tonnes of carbon dioxide each year, reducing the region’s emissions from ethanol plants, according to Summit Agriculture Group, the owner of the project. Spread over five states, the project would create up to 17,000 temporary construction jobs and hundreds of permanent jobs.

Such projects are necessary because the United States cannot immediately shut down all carbon-emitting facilities, including coal-fired power plants, and because there are not enough renewable sources of energy available for it. replace them, supporters said. Sequestration is necessary to meet the climate goals of the Paris Agreement, they said.

“The science and the math are clear: we’re going to have to keep burning fossils for the next 30 or 50 years, something like that, just to maintain reliability across the grid,” said Matt Fry, head of national and regional policy. for the Great Plains Institute, an energy solutions organization that promotes carbon capture.

“So the question is, how do you do this carbon neutral or carbon negative? Fry asked.

Opponents argue that coal-fired power plants, regardless of the potential for sequestration, should be shut down because their emissions harm the environment. They also say it might not achieve the level of reduction claimed by proponents of the project and stimulate the use of fossil fuels by using carbon dioxide to improve the extraction process.

“We will fight these pipelines the same way we fought [the controversial Keystone XL] pipeline: using all of the above including litigation, ”said Jane Kleeb, spokesperson for Project Bold Nebraska opponent, in an email.

10 million tonnes per year

The project is one of two large-scale Midwestern carbon capture and sequestration projects announced this year. The region is considered fertile for such projects due to its concentration of ethanol and fertilizer manufacturing sites emitting large amounts of carbon and suitable areas for sequestering it.

The Summit project will install equipment in no less than 30 ethanol plants located in Iowa, Minnesota, Nebraska, North Dakota and South Dakota that will capture near-pure carbon dioxide emissions resulting from the processes of fermentation.

The gas will be compressed and sent in liquefied form by pipeline to injection wells in North Dakota. The carbon will then be injected into depleted underground oil and gas fields, deep coal seams and salt formations, where project promoters say it will be trapped forever.

“Overall, we would expect to sequester at least 10 million tonnes of CO2 per year. When it is operational, we believe it will be the largest carbon capture and sequestration project in the world, ”said Justin Kirchhoff, president of Summit Ag Investors, a business unit of Summit Agricultural Group.

Investors in the project include high net worth individuals and venture capital firms that include Tiger Infrastructure Partners LP in addition to John Deere.

And CO Navigator2 Ventures LLC announced in October its Heartland Greenway project, a second carbon sequestration project in the Midwest. The Heartland Greenway will have approximately 1,300 miles of pipelines in five Midwestern states and will initially capture carbon at approximately 20 industrial sites, primarily in Iowa.

This project, whose investors include BlackRock Inc. and its estimated construction cost of $ 3 billion, aims to sequester carbon in northern Illinois and eliminate the carbon equivalent of emissions from 3.2 million vehicles taken off the road forever each year. Geophysical analyzes of properties that could be used for sequestration projects will be followed by the preparation and filing of permit applications. The projects could sequester carbon as early as 2024.

The Midwest Carbon Express will earn money using Article 45Qof the Federal Tax Code, which grants transferable tax credits to entities either for sequestering carbon emissions or for their use for qualified industrial purposes. Projects can also benefit from loans and grants from the Department of Energy, while investors who participate in carbon capture projects can improve their environmental, social and governance scores.

Sponsors of carbon capture and sequestration projects “get a higher ESG rating, which helps them achieve a lower cost of borrowing capital,” said Mona Dajani, partner at Pillsbury Winthrop Shaw Pittman LLP who heads the company’s practice of renewable energies and is an infrastructure negotiator.

The credits increase gradually from year to year and will reach a maximum of $ 50 for each metric ton sequestered and $ 35 for each metric ton used for qualifying purposes. Other revenue opportunities include revenue sharing from sales of low-carbon ethanol produced in plants that meet certain state’s low-carbon fuel standards.

Exposure to litigation

Opponents of the project say the Summit and Heartland Greenway projects will ruin valuable farmland and force farmers to grow as much corn as possible to produce ethanol instead of adopting more sustainable practices.

They also cite the potential risk of pollution of waterways and agricultural lands if the pipes rupture and the escaping emissions produce carbonic acid.

Moreover, carbon tax credits and trading markets are not climate solutions but means of shifting polluting emissions between entities to enrich private interests, say opponents. And carbon-capturing companies could still use those emissions for industrial purposes, including boosting oil extraction from the ground, which means increased use of fossil fuels.

Opponents of the project said state and federal permit approvals could be part of a strategy to shut down the pipeline.

“We have to fight through the regulatory process, we have to fight against the use of public money, we have to bring as many landowners as possible against this, we have to argue that it is not a public necessity”, Jessica Mazour, The Sierra Club’s conservation program coordinator, said in an interview.

The Sierra Club received funding from Bloomberg Philanthropies, the charity founded by Michael Bloomberg. Bloomberg Law is operated by entities controlled by Michael Bloomberg.

Eminent domain

The projects could build on states’ use of the prominent domain to install the pipeline if landowners refuse to voluntarily grant access to their land, some landowners worry.

“If it comes down to a prominent area, there will be some big fights, I firmly believe so,” said Beulah, North Dakota landowner and resident Kurt Swenson in an interview.

Summit asked Swenson to sign a lease for his land. He has not yet signed for the sake of certain lease conditions, although some of his neighbors have.

“We are not opposed to the project, but we should have aligned interests with the developer of the project,” he said. “And while there is great pressure for climate change regulations and carbon dioxide reductions around the world, that doesn’t mean you should steal someone’s property for private gain.”


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