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The Carbon Capture Pipeline: The Latest Bridge to Nowhere

The carbon capture pipeline is the result of the latest gift to rent-seeking “titans of industry” and interestingly, may be used on some existing projects that came to be, years ago, due to rent seeking. More on this below.

As we’ve heard for years and years now, sometimes delivered in memorable ways, the continuing elevation of atmospheric levels of carbon dioxide, and other greenhouse gases, and the rising global temperatures that follow, is the defining issue of our time. Apparently, these couple of metrics are all we need to know to understand the fate of humanity and the future of life on Earth (even though that’s obviously false).

However, as governments often do, never let a simple, catastrophic concept go to waste, especially when it means that further state intervention can be achieved. A carbon capture pipeline is just one example of how policy is used to generate projects that hope to reduce greenhouse gases. So, what is a carbon capture pipeline? Simply put, it’s a series of pipes and other equipment that are plugged into facilities that emit greenhouse gases, which are then sequestered deep within the Earth.

In this case, I’m referring to the Summit Carbon Solutions five-state pipeline in the Midwestern US. The pipeline will be connected to more than thirty corn ethanol biofuel plants, ultimately transporting carbon dioxide and other gases to North Dakota for burial deep underground. As I’ve documented on this site, corn ethanol plants likely would not exist, at least in the current forms, without substantial support from government. It’s yet another case of state intervention causing unintended consequences, which are used to justify further state intervention.

With the current pipeline project, opposition by some landowners and farmers has been dealt with, at least in South Dakota, using the Public Utilities Commission. According to state law, any company that has requested a permit from the Commission does not need the permission of the landowner to conduct a survey, which involves the use of heavy equipment on farmers’ crops, with the potential of disrupting drainage tile below the soil. Apparently the same concept exists in Iowa, but interpretation has differed based on county. Also, the definition of “surveying” is different for different people because during one recent incident in South Dakota, surveyors entered the home and workshop of a farmer, terrifying the man’s wife and prompting some sort of response (the accounts of what happened differ dramatically) from the farmer himself. Perhaps this is why the surveying teams now have armed guards with them as they legally intrude across the land. Not allowing the pesky concept of private property rights to get in the way, there are currently about eighty eminent domain lawsuits underway in South Dakota, initiated by what is in theory a private company (at least when the money rolls in, anyway), but which also defines itself a “public carrier.”

It’s worth discussing the dismal history of carbon capture projects. Despite backing from the US Department of Energy, several projects never started or stalled out along the way. Some projects failed due to technical complications, including one pipe rupture event that dumped enough carbon dioxide onto a small town to make residents struggle to breath (forty-five were hospitalized) and internal combustion engines stop working. The Petra Nova project in Texas managed to survive a mere three years amid technical and financial problems, while never achieving the carbon capture targets laid out at the beginning. Indeed, it’s been estimated that a wind farm project, at a cost of less than half of the Petra Nova project, would have achieved the same carbon reduction goals.

So, why the interest, including the use of armed guards to keep the surveying projects moving forward, in this new carbon capture pipeline? The revised Section 45Q tax credit policy, which recently went into effect, provides enhanced incentives for these types of carbon-reducing projects. Among the changes are increases in the credits provided per metric ton of sequestered carbon dioxide, with continued increases through 2026 (more than doubling the original amount); reduced requirements for annual capture (in some cases, a reduction from five hundred thousand metric tons to only twenty-five thousand); and a requirement that construction begin before the start of 2026.

The claim period can now run for twelve years once a facility is operational. Previously, only the first sequestered seventy-five million metric tons qualified for these credits. As is often the case with artificially incentivized projects like this, what happens after twelve years is unknown, except that an aging five-state pipeline, and other equipment that need maintenance, will be sitting around for decades to come.

It’s one other feature of the new carbon capture projects (apparently not for the Summit Carbon Solutions’ pipeline, but to be sure, corn ethanol fuel use should expand in the future) that is perhaps the most telling. The new Section 45Q tax policy will triple the amount of credits given per metric ton carbon dioxide that is injected into oil fields. This process, known as Enhanced Oil Recovery, or EOR, uses carbon dioxide to increase the overall pressure within an oil reservoir, forcing oil toward productive wells. A great process for increasing the productivity of oil extraction, to be sure, but what eventually happens to the newly extracted oil? Sooner or later, it becomes fuel that is used for productive purposes, and also, emits more carbon dioxide and greenhouse gases into the atmosphere.

Don’t be fooled by the newest interesting technology to reduce atmospheric levels of carbon. Indeed, a worldwide program of planting trees could remove about two-thirds of all emissions that have been pumped into the atmosphere by human activities. This and other projects like are nothing more than state-backed investments under the guise of combatting climate change.

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