Carbon bills coming down the pipeline: North and South Dakota discuss C02 sequestration
It’s not coming ’round the mountain and it isn’t over the river and through the woods. At least not yet. While a carbon pipeline has not been laid in the Dakotas, a variety of bills impacting the approval and building process for carbon sequestration pipelines are being discussed in the two states.
In South Dakota the following bills are still alive:
HB 1052 – prohibit the exercise of eminent domain for a pipeline that carries carbon oxide.
HB 1085 – establish a moratorium on the construction of carbon dioxide pipelines in this state.
HB 1249 – protect landowners from the use of deception, fraud, harassment, intimidation, misrepresentation, or threat, in acquiring easements or easement options.
SB 198 – An Act to establish conditions a prospective condemnor must satisfy before commencing condemnation proceedings.
Canton area District 16 Representative Karla Lems said her bill, HB 1052, is key for the protection of landowners who might be impacted by the proposed carbon pipeline.
HB 1052 would prevent carbon pipeline companies from using eminent domain to gain access to land. Summit at one point had sued around 160 South Dakota landowners for eminent domain but when the supreme court ruled that the pipeline would not be carrying a commodity, the eminent domain lawsuits became invalid.
Lems said that if her bill passes, it will protect all landowners going forward against eminent domain lawsuits from carbon pipeline companies.
According to the U.S. Justice Department, “The federal government’s power of eminent domain has long been used in the United States to acquire property for public use. Eminent domain has been utilized traditionally to facilitate transportation, supply water, construct public buildings, and aid in defense readiness.”
The proposed carbon pipeline is privately-owned and is not carrying a commodity (according to the state supreme court and) and is not a government entity.
Of HB 1052, Lems said, “This bill is the solution when it comes to protecting landowners.” Summit’s original proposed pipeline route would have crossed Lems’ private property but the new route doesn’t affect her land.
This bill is on the Senate State Affairs Committee agenda for March 3 at 10 a.m., Central Time. Lems said the committee meeting is expected to run long so her bill might not be heard until the afternoon session. The public is welcome to testify on the bill.
HB 1085 will be before the Senate State Affairs committee on March 4. Richard Vasgaard of Centerville who also represents District 16 sponsored this bill that establishes a moratorium on carbon pipelines until the Pipeline and Hazardous Materials Safety Administration has adopted final pipeline safety rules consistent with its proposed rulemaking. If and when those final rules are adopted, the moratorium would be lifted.
Representative Haley Nolz of Mitchell, representing District 20 is the sponsor of HB 1249 which would protect landowners from the use of deception, fraud, harassment, intimidation, misrepresentation, or threat, in acquiring easements or easement options. This bill will be heard in Senate State Affairs on March 4.
Senate Bill 198 is not listed as a “pipeline” related bill on the state website.
However it would impact landowners approached by pipeline companies or any other companies seeking eminent domain.
Pierre-based Senator Jim Mehlhaff of District 24 is carrying SB 198. Casey Crabtree from Mitchell is a co-sponsor. The bill was hog-housed onto a bill originally introduced by Sioux Falls Senator Liz Larson. The term hog-house means that the original bill was replaced by a different one that may be unrelated and not consistent with the intent of the original language.
Mehlhaff’s bill establishes certain protocols for a company or utility to follow in order to condemn land using eminent domain.
Mehlhaff said he does not own ag land but that some of his constituents in Sully and Hyde Counties are affected by the proposed pipeline route.
He said he believes this bill would take away opportunities from developers by requiring them to meet certain standards before suing for eminent domain.
He explained that the bill would require the company to contact landowners about building plans that they want an easement for. If the PUC grants the company a building permit, it would be required to offer mediation to any landowners who choose not to sign easements. If the landowner declines mediation, the developer can then file an eminent domain lawsuit.
Mehlhaff said his bill gives landowners more opportunity to be heard by neutral parties. He said some landowners in his district have told him they oppose the bill because they want the carbon pipeline project killed. He said his bill does not “force mediation” as some are claiming.
Lems doesn’t support 198, saying it is unfairly friendly to developers. She said landowners should have the right to say “no thank you,” to a carbon pipeline and not expect to be bothered again.
“This bill sets up the landowner to be at a disadvantage if and when they are taken to court. They have the right to say ‘no thank you,’ but if they have refused to talk to or negotiate with the developer, the judge will probably think they are being uncooperative,” she said.
Lems said another way the bill gives developers the upper hand is that it gives them the ability to choose three options for the mediator.
If Lems’ HB 1052 is passed and signed by the governor, SB 198 wouldn’t impact landowners affected by carbon pipelines because the carbon pipeline companies will be prohibited from using eminent domain.
Several pipeline-related bills were killed. HB 1261, sponsored by Drew Peterson, a Republican from Salem, would have given counties authority over townships and municipalities in certain building projects. Some were calling this bill a “mini SB 201” in reference to the controversial 2024 bill that would have limited local control over pipelines. SB 201 passed through the legislature but was repealed through the referendum process when voters approved Referred Law 21.
SB 212 and SB 49 were both tabled, effectively killing them.
District 13 Representative John Hughes of Sioux Falls sponsored HB 1228 that makes an environmental impact statement mandatory as part of the permitting process for a carbon dioxide transmission facility permit from the South Dakota Public Utilities Commission. The commission chose not to require an environmental impact study in the 2023 CO2 permit application. State law allows the PUC to charge applicants additional percentage fees. Because the language of the bill mentioned these discretionary fees, additional discretionary fees, Representative Will Mortenson of Fort Pierre argued on the House Floor that the bill should require a 2/3 vote to pass. Hughes then offered a floor amendment to solve Mortenson’s question and explained that the bill’s intent was not to change any fees the PUC would or could charge. The amendment failed and Hughes says that confusion reigned on the floor at this point. His bill garnered 37 votes, more than a majority of the 70 members, but not a 2/3 vote, so the speaker declared that the bill was lost.
The North Dakota House of Representatives killed six pipeline related bills that would have helped protect landowners and the public and slowed the progress of the pipeline. The North Dakota legislature two years ago approved legislation to give the state authority to “amalgamate” landowners within the carbon deposition area. Through this law, if 60 percent of the land is under voluntary easement, the owners of the remaining land can be forced to accept the carbon deposition.
- House Bill 1292, removing common carrier status for carbon pipelines.
- House Bill 1414, denying use of eminent domain for carbon dioxide pipelines and revoking common carrier status for carbon pipelines.
- House Bill 1295, eliminating tax exemptions for carbon pipelines.
- House Bill 1573, imposing a fee on carbon dioxide transportation to create a disaster fund.
- House Bill 1210, specifying that carbon dioxide pipeline companies are liable for damages within a 25-mile zone if a pipeline leaks or ruptures and providing protections against pipeline operator’s bankruptcy.
- House Bill 1574, which would have placed a two-year moratorium on direct air capture of carbon dioxide in North Dakota.
Rep. SuAnn Olson, R-Baldwin sponsored four of the bills.
The North Dakota Senate killed Senate Bill 2320 sponsored by Jeff Magrum of Hazelton, which would have removed a tax exemption for interstate carbon dioxide pipelines such as the Summit project.
According to the North Dakota Monitor, the North Dakota House Energy and Natural Resources Committee supported House Concurrent Resolution 3016, citing the benefits of enhanced oil recovery and encouraging the state and federal governments to support the development of carbon capture technology and utilization of carbon dioxide.
The carbon pipeline conversation has sparked a movement in South Dakota over the past couple of years.
Two different companies – Summit Carbon Solutions and Navigator both sough to build carbon sequestration pipelines across South Dakota and other states. Summit continues its efforts to build the 5-state $4.5 billion project intended to sequester carbon from ethanol plants across Iowa, Nebraska, Minnesota, South Dakota and North Dakota and pump the carbon dioxide underground in Western North Dakota near the town of Beulah.
Some ethanol plant spokesmen say the project will help them sell their product by making it more climate friendly.
GEVO, a company that says it plans to build a plant to create sustainable jet fuel has recently indicated it may move to North Dakota due to South Dakota’s resistance to the construction of a carbon pipeline.
The Summit pipeline project is expected to be propped up by 45Q tax credits that could total $18 billion in 12 years according to Inside Climate News.
Investors include:
- John Deere
- Continental Resources
- Tiger Infrastructure Partners
- TPG Rise Climate
- SK E&S
- Summit Agricultural Group
