Lawmakers advance bill to block carbon pipelines as regulators continue permitting process

The end of the week brought a flurry of activity related to proposed carbon pipelines as lawmakers advanced a bill to block the projects, and regulators waded through requests affecting the speed of the permitting process.

Navigator Heartland’s missed deadlines

State utility regulators voted 2-1 on Thursday to deny an effort by some landowners to send a proposed carbon dioxide pipeline project back to the start of the application process.

Navigator CO2’s Heartland Greenway project faced the potential setback for missing a deadline to provide notice of the project to 204 impacted landowners.

The project would capture carbon dioxide emitted from ethanol plants in the Midwest and transport it in liquified form through a multi-state pipeline to be sequestered underground in Illinois. Another pipeline proposed by Summit Carbon Solutions would sequester carbon underground in North Dakota.

Pipeline projects go through a monthslong application process with a state regulatory body, the South Dakota Public Utilities Commission. The PUC is made up of three publicly elected commissioners – Kristie Fiegen, Gary Hanson and Chris Nelson – and a small staff of analysts and lawyers.

Landowners said Navigator failed to “notify, in writing, the owner of record of any land that is located within one-half mile of the proposed site where the facility is to be constructed” within 30 days following the filing of the application. They argued “the only appropriate course is for the Commission to return the application.”

Navigator argued its application was “not deficient in form and content” and said the commission lacks statutory authority to return an application for late notice. The company said state law only allows an application to be returned for failure to file it “generally in the form and content required.”

Commissioners Nelson and Fiegen voted against the landowners, saying Navigator had met all necessary requirements in the application process, and that giving notice to landowners was a separate process.

“If they were one, then there would be this remedy,” Nelson said. “But they’re not, they’re two separate functions, clearly separate in the statute.” 

While voting against sending the project back to the starting line, Fiegen acknowledged Navigator missed the notice deadline. But she said it’s up to the company to figure out how to address the shortcoming.

“Navigator has made a mistake, and so they have to choose how they’re going to deal with the mistake,” Fiegen said.

Hanson was the lone vote to send the process back to the start of the application phase. He was not convinced the notice process was entirely separate from the application process.

“Two hundred is a lot of folks to not receive an application that is supposed to be sent out,” Hanson said.

Public hearings on Heartland Greenway’s permit application are scheduled for June.

Summit pipeline schedule

Also Thursday, in actions that sparked less debate, the regulators dealt with two requests from Summit Carbon Solutions related to its proposed pipeline project.

The commission unanimously denied an effort by the company to adjust the PUC’s current procedural schedule, which would have resulted in a final permitting decision by June.

However, regulators approved an effort by Summit Carbon Solutions to set a final permitting decision no later than Nov. 15. Hanson was once again also the lone no vote.

Landowners opposed to the actions said Summit failed to notify 156 impacted landowners by a required deadline.

Public hearings on Summit’s permit application are scheduled for September.

House says no eminent domain for CO2

In another pipeline-related development Thursday, legislators in the South Dakota House of Representatives voted 40-28 to pass a bill intended to prevent carbon pipeline projects from using eminent domain.  

The bill now heads to the Senate.

Current state law says “all pipelines holding themselves out to the general public as engaged in the business of transporting commodities for hire by pipeline” are common carriers. The law also says common carriers may exercise eminent domain, which is a legal process to obtain access rights from landowners who are unwilling to grant them. 

The bill excludes carbon pipelines from the definition of a “common carrier.” That means a carbon pipeline would not be allowed to use eminent domain, which could have the effect of killing the projects.

An opponent of the bill, Rep. Roger Chase, R-Huron, said the CO2 traveling through the pipelines will be sequestered underground, but a future company could one day use it. 

“We have so much production of CO2 running through all 14 ethanol plants, that it’s more than we could ever utilize through consumption,” Chase said. “Some day I could envision, along this pipeline, if it gets built, an industry that finds a use for CO2.”

That argument didn’t convince the majority.

“At this time, this product is going straight into the ground,” said Rep. Oren Lesmeister, D-Parade. “Unless somebody can tell me they’re going to extract it back out and use it for a soft drink or something else that it could be used for, then I consider it not a commodity. It’s a byproduct.”

However, it wasn’t a party-line vote. While Lesmeister voted in favor of the bill, Linda Duba, Erin Healy, Kameron Nelson, and Kadyn Wittman – all Democrats representing Sioux Falls – voted no.