SD Regulators Say Carbon Pipeline Company Must Show a Path Forward to Keep Permit Application Active

By Joshua Haiar

South Dakota regulators refused Thursday, April 10, to pause proceedings on a carbon capture pipeline permit, instead directing Summit Carbon Solutions to present a plan during the next meeting illustrating how the company can move forward — or not — under a new state law barring its use of eminent domain.

The Public Utilities Commission, meeting in Pierre, voted 3-0 to deny Summit’s request to put its application on hold.

“What’s the plan here? And that’s the question that’s rolling around in my mind,” Commissioner Chris Nelson said.

The proposed $9 billion pipeline would carry carbon dioxide emissions captured from ethanol plants in five states to an underground storage site in North Dakota, where it could also be used to extract oil from old wells. The project is part of a broader federal push to reduce greenhouse gas emissions and could qualify for federal tax credits tied to carbon sequestration.

Summit has been seeking a permit from state regulators to build a portion of the pipeline through the state since 2022. But its path forward was complicated by the Legislature’s passage of the eminent domain ban in March. Eminent domain is a legal process that allows qualifying entities to acquire access to private land for projects in the public interest, with compensation for landowners determined by a court.

Summit had relied on that authority to survey land and secure access from property owners unwilling to sign voluntary easements.

“If they can’t even build it, what are we doing here?” said attorney Brian Jorde, representing landowners opposed to the project.

Nelson moved for the permit to be denied, arguing that the proposed route cannot be legally constructed under the new law and citing declarations from dozens of landowners refusing access. His motion failed 2-1, with the other commissioners saying Summit should be given more time.

Summit attorney Brett Koenecke said the company needs more time to evaluate its options, but declined when pressed by Nelson to say whether Summit plans to challenge the eminent domain ban in court.

The commission plans to consider the matter again at its April 22 meeting.

Summit has permits in North Dakota, Minnesota, and Iowa, but some of the permits are being challenged in court. Nebraska does not have a permitting process for the project.

This story was originally published by South Dakota Searchlight, which is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. South Dakota Searchlight maintains editorial independence. Contact Editor Seth Tupper for questions: [email protected].

Iowa Capital Dispatch is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Iowa Capital Dispatch maintains editorial independence. Contact Editor Kathie Obradovich for questions: [email protected]. Follow Iowa Capital Dispatch on Facebook and Twitter.