Renewable Fuels Study of Impact of Blocked Carbon Pipeline Construction

(Radio Iowa) A study commissioned by the renewable fuels industry suggests corn prices in Iowa would drop significantly if carbon capture pipelines are not built in Iowa. Monte Shaw is the executive director of the Iowa Renewable Fuels Association.

“It’s like asking a farmer, a corn farmer on the corn side of their equation to take an 85% pay cut,” Shaw says. New federal tax credits are available for proposed pipelines that would capture carbon from Midwest ethanol plants and ship the carbon to underground storage in North Dakota and Illinois.

“We are now looking at Iowa being the only…state on the map where there is still an active effort to derail these projects,” Shaw says. A bill in the Iowa House would establish new steps pipeline developers would have to clear. Most notable is a requirement that property owners along 90 percent of a pipeline’s route voluntarily let developers have access to their land. The study found the price for corn could plummet by as much as 80 cents per bushel if carbon capture pipelines are connected to ethanol plants elsewhere, but not in Iowa. The Iowa Renewable Fuels Association is asking its members to lobby House members to vote against the bill. Tim Recker, a corn farmer from Arlington, says carbon pipelines are the next step for the ethanol industry.

“If we don’t find favor in getting CO2 transported, I’m going to be shipping corn to my neighboring states or I’m going to be putting a lot more corn on the river system — an 80-year-old lock and dam system, our rail system or trucking it a lot farther than I do today,” he said “and to me, that’s going backward in our industry, not forward.” Recker and Shaw spoke during an online news conference. Shaw cited part of the study which found just six percent of Iowa field corn currently leaves the state without having value added either by being used to make ethanol, fed to livestock, or converted to industrial use.

“If we don’t align ourselves to be profitable under the current policy and market conditions and we let the ethanol production migrate out to those areas that do, the study found…44% of our corn would leave this state without having any value added to it.” Key Republican lawmakers who have proposed new regulations for the pipelines say they’re defending the rights of landowners who don’t want their land seized through the government’s eminent domain process. Other pipeline opponents question the safety of the pipelines and whether capturing carbon from ethanol plants is among the best ways to reduce greenhouse gases.