State Legislators Pass House Bill that Bans Companies from Using Eminent Domain to Build Carbon Capture Pipelines

By B.N. Frank

Proponents continue to describe carbon capture as “green energy” despite proven environmental risks associated with it. Opposition to deployment is increasing among citizens, environmental groups, and legislators throughout the U.S. (see 1, 2, 3) including in South Dakota.

From Argus Leader:

Carbon pipeline bill clears South Dakota House floor in win for property rights advocates

Dominik Dausch Annie Todd

Sioux Falls Argus Leader

PIERRE — South Dakota landowners opposed to looming pipeline projects are officially one step closer to fending off Big Carbon.

On Thursday, legislators voted 40-28 to pass House Bill 1133, a bill that effectively prohibits carbon capture companies, like Summit Carbon Solutions and Navigator CO2 Ventures, from utilizing the state’s eminent domain laws to build their multi-billion dollar hazardous liquid carbon dioxide pipelines through parts of South Dakota.

Since the early days of this year’s legislative session, a mish-mashed wave of plaid-and-suit wearing farmers and landowners have occupied South Dakota’s Capitol to stand in opposition of the pipelines, Mark Lapka, a landowner from Leola, told the Argus Leader on Thursday.

He said their stand-out presence showed South Dakota’s legislative body they’re serious about the future of their land.

“We’re farmers and ranchers, and we’re obviously out of our element down there. We’re not lobbyists, but you know, we are the constituents,” Lapka said prior to the vote. “We’re not there, because we want to be there. We’re there, because we have to be there, and this is our government, and we need to get something done.”

Currently, South Dakota law considers companies with pipelines as “common carriers,” or companies that transport commodities, and allows them to exercise eminent domain within the state.

Based on the bill’s language, the new law would exempt companies whose product is disposed of under the earth or allows them to qualify for tax credits, like carbon companies seeking to benefit from the Inflation Reduction Act’s clean energy provisions.

Ames-based Summit’s Midwest Carbon Express pipeline is estimated to cost $4.5 billion and cover more than 477 miles of South Dakota land along its projected route. Navigator, which is based out of Nebraska, is building a $3 billion dollar pipeline, the majority of which runs through Iowa and also tracks a 111.9-mile route through eastern South Dakota.

Summit declined an interview following the Thursday vote. However, the company said it continues to make progress gathering support and acquiring easements from landowners along the path of their pipeline.

“Nearly 500 South Dakota landowners have signed easement agreements with Summit Carbon Solutions, accounting for over 60% of the proposed pipeline route in the state, with additional landowners signing agreements every day. This overwhelming level of support tells us South Dakota landowners along the route view the project as critical to supporting the state’s most important industries – ethanol and agriculture. We look forward to continuing to work with landowners, stakeholders, and policymakers to advance our nearly $800 million investment in South Dakota’s future,” the company said in a statement.

‘What is a commodity?’

For its part, the bill provides a definition for what is and isn’t a commodity. For some of those in favor of the bill, like Rep. Kevin Jensen, their remarks framed carbon dioxide as a byproduct.

“At this time, this product is going straight into the ground, unless somebody can tell me they’re going to extract it,” Democrat Rep. Oren Lesmeister said.

Republican Rep. Roger Chase was the first legislator to announce his “no” vote ahead of the decision. He said he’s seen the ethanol industry grow over the last 30 years and added passing the bill would “ultimately sacrifice this particular industry in South Dakota.”

“My definition of a commodity is a useful project. This is something that derives from the use of ethanol, and it does impact my farm,” Chase said.

Chase opined his authority on the issue, saying that “I may be the only legislator on this floor that this pipeline actually impacts.” Republican Rep. Karla Lems, the prime sponsor of the bill and a new member of the House, countered her colleague’s assumption by asserting land she owns is also impacted by the pipeline.

What’s worth more: A business-friendly climate, or landowner’s rights?

Another concern for “no” voters is the perception this bill could create when it comes to South Dakota’s business climate. Republican Rep. Hugh Bartels took issue with how the bill appears directed at companies like Summit, which could be a ballast for the state’s ethanol and agricultural industries. He said passing this bill while enterprising businesses look to profit in South Dakota could erode the state’s reputation.

“[The bill is] going to take South Dakota’s business friendly climate and send it down the toilet,” Bartels said.

But Lesmeister, whose legislative profile states he is a farmer, rancher and ag business owner, served up a blunt rebuttal: “I don’t really care.”

He said he has received many e-mails from landowners expressing their concern over losing parts of their property, because of the pipelines. The district 28A representative said voting “no” on the bill would essentially “throw [his constituents] under the bus.”

“When we’re talking about property rights versus progress, it is an age-old debate. I suspect in South Dakota, when the railroads first came through, we were having similar discussions about how we treat landowners,” Republican Rep. Will Mortenson told reporters before the Thursday afternoon vote. “This is an age old clash. It’s not a partisan one. It’s not a political one. It is about principles. And there are good valid arguments on both sides of this debate.”

Another piece of pipeline-related legislation, House Bill 1230, was passed by the South Dakota House on Wednesday. This bill provides minor clarifications on how defendants in court cases involving eminent domain are compensated for accrued legal fees.

House Bill 1133 now heads to the South Dakota Senate for debate.

Dominik Dausch is the agriculture and environment reporter for the Argus Leader and editor of Farm Forum. Follow him on Twitter and Facebook @DomDNP and send news tips to [email protected].