Economist says carbon pipeline decision may impact the entire ethanol industry

FORT DODGE — The second week of hearings opens Tuesday in Fort Dodge as the Iowa Utilities Board takes public comments on the proposed Summit Carbon Solutions pipeline that would run nearly 700 miles across 29 Iowa counties.

Creighton University economist Ernie Goss says the board’s ultimate decision could have a tremendous impact on the Midwestern ethanol industry. “As part of the Inflation and Deficit Reduction Act passed in 2022 by the Biden Administration,” Goss says, “that calls for a 30% reduction in CO2 emissions from the ethanol plants. If you don’t do something about that — if they enforce reductions — that’s going to be a problem for ethanol, and, what’s a problem for ethanol is a problem for agriculture.”

The pipeline, one of three proposed in Iowa, would carry liquid carbon dioxide from ethanol plants to a sequestration site in North Dakota. Goss says states like Iowa and Nebraska depend heavily on ethanol production.  “Iowa, particularly, is the number-one ethanol producer in America,” he says. “Nebraska is number two, then you’ve got Minnesota and South Dakota following close behind it. This is a very, very important question in what happens to ethanol going forward. I’m just not as confident as some that the Biden Administration will not put a pinch on ethanol.”

The first week of testimony was mostly from landowners and farmers who oppose the project, ridiculing what they say are scare tactics being used by the company. Many expressed fears about the potential impacts on land prices and on the environment.

The Iowa Renewable Fuels Association issued a report in February saying 75% of the state’s ethanol production would contract or migrate out of the state if carbon sequestration projects are curtailed, leading many plants to shut down.