‘Wild West territory’: New fight over pipelines emerging in Nebraska | Nebraska News

Although they were among the few dozen landowners who refused to sign an easement allowing tar sands from western Canada to be pumped across 1,189 feet of their Holt County farm near Page, experience told the Crumlys to never presume the pipeline dead.

Only after condemnation proceedings on a swath of land about a quarter-mile north of their home was rescinded in September did the Crumlys breathe a sigh of relief.

“We went, ‘OK, we’re good,’” said Jeanne Crumly, a retired English teacher. “For now.”

The “for now” didn’t last long.

A few weeks later, in October, the Crumlys began fielding phone calls from panicked neighbors who had been contacted by a new pipeline company.

The new project was different, and something many had never heard of before, and they turned to the Crumlys, who had experience in asserting their rights as landowners, for guidance on what to say and do.

Iowa-based Summit Carbon Solutions proposed 2,000 miles of pipeline — “Midwest Carbon Express” — to convey carbon dioxide captured at 30 ethanol plants to be injected into an underground reservoir in North Dakota.

Soon, the Crumlys also learned they were once again on the route for 315 miles of pipeline in Nebraska.

“(Summit) called and said the pipeline was going through our land and a fellow was coming out in the morning and wanted to get papers signed,” Jeanne Crumly said. “And we said, ‘Well, we’re not going to sign any papers.’”

The next morning, despite their denial, a black SUV pulled into the Crumlys’ driveway.

Out stepped a land agent who explained politely he wanted the Crumlys to sign paperwork allowing Summit to survey the land that would potentially be on the pipeline route.

To the Crumlys, the situation was all too similar to their dealings with TransCanada, which they had fought in court and elsewhere for years to prevent land from being seized through eminent domain.

Sitting in their kitchen, the Crumlys told the advance man they weren’t interested.

“You’re a little ahead of the game,” Ron Crumly told him. “I haven’t signed any paperwork or anything and don’t know what’s going on.”

Jeanne Crumly was more blunt.

“You realize this is the Keystone route?” she told the representative. “You realize we fought for 12 years? And you realize we turned down a lot of money?

“I don’t think this is where you want to be running this project.”

Nearly 40% of the 700 million bushels of corn harvested in Nebraska each year is sent to two dozen ethanol plants across the state.

There, the corn becomes 2.5 billion gallons of renewable fuel, which is blended into gasoline across the United States.

With 1,400 employees, supplier-farmers and customer-feeders, the state’s ethanol industry has a $5 billion economic impact on the state, according to figures tracked by the Nebraska Ethanol Board.

With ethanol already marketed as a cleaner fuel option, new state and federal incentives to move the U.S. toward “net-zero” greenhouse gas emissions have created what many in the ethanol industry see as the next big opportunity.

Some ethanol analysts have even gone so far as to call the proliferation of carbon capture and sequestration projects the industry’s “new gold rush.”

By reducing their “carbon intensity,” Nebraska’s ethanol plants will maintain access in big consumer markets such as California, where a low-carbon fuel standards program awards credits to producers for offsetting greenhouse gas emissions.

The companies that capture and sequester carbon dioxide, in turn, can take advantage of a tax credit created by Congress in 2008 — known as 45Q — that provides roughly $32 for every ton of carbon stored for up to 12 years.

By 2026, the tax credit will increase to $50 per ton. A provision by the Biden administration would increase the tax credit to $85 per ton, but the proposal stalled with the rest of the Build Back Better legislation.

As the bill was being debated in Congress, several companies announced carbon pipeline projects last summer, seeking to connect with dozens of ethanol plants in Nebraska and beyond.

The Summit project, which is expected to cost $4.5 billion, will capture an estimated 315,000 tons of carbon dioxide annually at the Husker Ag ethanol plant near Plainview, according to the Global Carbon Capture Sequestration Institute.

About an hour’s drive to the west, the Summit pipeline will transport an additional 157,000 tons of carbon dioxide from Green Plains in Atkinson.

The four other carbon capture projects on Summit’s “Nebraska Lateral” — in Wood River, Central City, York and Norfolk — will divert between 143,000 tons and 346,000 tons of carbon dioxide for sequestration each year.

Carbon capture could help boost ethanol plants’ economic potential, said Brian Vasa, an economic development consultant with Nebraska Public Power District.

By capturing 120,500 tons of carbon dioxide annually, an ethanol plant capable of manufacturing 50 million gallons of biofuel could realize a $30 million impact, Vasa told a conference sponsored by Renewable Fuels Nebraska and the Nebraska Ethanol Board earlier this month.

Vasa said that meant potentially increasing ethanol’s economic effect on the state by $1.5 billion annually.

Ethanol plant managers said not leaping head-first into the industry’s latest permutation could also have the opposite, more dangerous, effect.

“If we are kept from reducing the carbon intensity of our plant,” said Nathan Nowlin, manager of Green Plains in Atkinson, “it could put us out of business.”

Ron Crumly isn’t sold on the science of converting carbon dioxide from a gas to a liquid, maintaining the correct pressure to safely pipe it thousands of miles away, and injecting it underground as a long-term storage option.

And he remains firmly opposed to the use of eminent domain in order to do so.

But, the economics of the project, both for the biofuel plants and the farmers who supply them, have changed the dynamics of the situation.

“I’m in a bittersweet position here,” Crumly said. “I need the ethanol plants to stay running.”

The couple’s attitudes about the project — like many others in Holt County and other areas where pipelines are planned — remain colored by their experiences with TC Energy.

The announcement of the carbon pipeline projects last summer, as well as other zoning issues brought to local officials’ attention, led Holt County to hire a consultant to conduct the first full review of its land-use regulations since 1980.

While that review is ongoing, the county’s planning and zoning commission recommended setting an 18-month moratorium on any new conditional-use permits issued in Holt County.

According to Mary Kaczor, a commissioner from Ewing, the moratorium would give the board time to learn what regulations Holt County residents wanted to see enacted.

The proposed moratorium ran into heavy opposition at a March 16 public hearing held by the Holt County Board of Supervisors, however.

Steve Martin, the executive director for the Alliance for the Future of Agriculture in Nebraska, a coalition of commodity groups across the state, said Holt County should rely on its existing regulations to determine future land use.

He also added that any regulations that would potentially hold back ethanol plants from expanding would hamper Nebraska’s livestock industry, which uses the byproducts of ethanol manufacturing as a food source.

“As you go through changing regulations, to shut down an industry just because you are afraid of what might happen, I think, is just kind of a bad look for the county,” Martin said. “It puts forward a presence of not being very business-friendly.”

John Ecklund of Atkinson, a member of the Nebraska Cattlemen’s board of directors, said the moratorium wouldn’t stop any new pipeline projects, which he called “inevitable.”

A break on granting permits could put up a warning sign to businesses thinking about locating in Holt County, he added.

“Whatever you feel about carbon sequestration, whichm personally, I think is a bunch of malarkey, to use a popular phrase,” Ecklund said, “it’s what the regulation is going to be.”

The pipeline project, the biggest of its kind in the world, has to come together as one, Seth Harder, general manager for Husker Ag, told the board. Husker Ag, which is located in neighboring Antelope County, would also connect to the Summit pipeline.

“If some projects aren’t allowed to participate, it could jeopardize the entire project,” he added. 

Those who spoke in support of the moratorium said it was a temporary measure to allow the county to ensure it had the regulations it needed when considering permits that would potentially affect quality of life in the area.

“Forty-two years ago when the rules were written, there was not the slightest idea (carbon pipelines) would exist, let alone cross Holt County,” said Robert Randall, a retired doctor from Atkinson.

“We need to establish some ground rules,” he added. “It seems reasonable there would be a moratorium.”

Diana Steskal, who along with her husband, Byron, was on the front lines of the fight against Keystone XL, said zoning regulations quickly enacted by Holt County in 2010 afforded just enough protections for landowners.

A moratorium, she added, would give the commission time to ensure its regulations continued to protect those individuals and prevent them from going through the same emotional and financial stress for another dozen years.

“Eighteen months, compared to 12 years, is a walk in the park,” she told the board.

Jane Kleeb, who started Bold Nebraska to fight the Keystone XL pipeline, told the board a moratorium was “common sense,” even if the county ultimately decided to grant Summit a permit.

As it stands, without action by the Legislature, Nebraska’s counties have authority over whether to allow the pipelines to operate, Kleeb said at the meeting.

“We are now in Wild, Wild West territory, where the only safeguard landowners have is their county board.”

In other states, where responsibility for approving the pipeline is the responsibility of a state utility board, several counties have raised objections to both the Summit and a second proposed pipeline.

Navigator Ventures LLC’s proposed $2 billion, 1,300-mile Heartland Greenway will gather carbon dioxide from plants near Columbus, Albion and South Sioux City and join a pipeline that cuts from northwest to southeast across Iowa, eventually injecting it underground near Taylorville, Illinois.

Like Summit, Navigator has met with county officials but not yet sought permits from Nebraska counties. A timeline for the project said Navigator expects to finalize permits with federal and state authorities in late 2023.

In a Dec. 27, 2021, letter asking the Iowa Utilities Board to deny the pipeline permit, the Hancock County Board of Supervisors said it had “a gross lack of communication” from Summit about the project.

The north-central Iowa county also said it was concerned how the pipeline would affect waterways, drainage tiles and roads.

Hancock County said it also disagreed with the notion that the companies could use eminent domain to build the pipeline if landowners did not sign easements.

“Eminent domain is the government’s power to take private property for public benefit,” the board wrote in its letter. “The question that arises is how (Summit), a private company, is serving a public purpose.”

Iowa is soliciting public feedback on locating the proposed pipeline project through the end of the month ahead of an April 12 meeting in Des Moines.

In South Dakota, where the matter was considered by the Public Utilities Commission in a series of recent public hearings, McPherson County adopted a moratorium on new pipelines being built.

“Nearly all of the concerns surrounding the pipeline were regarding both the short-term and long-term safety of the project and the possible health risks thereby associated,” the McPherson County Board of Commissioners wrote to the state utility board Jan. 11.

Summit Carbon Solutions filed for a permit with South Dakota on Feb. 7. The commission will have a year to decide whether to grant permission for the project.

Back in Holt County, after more than an hour of public comment, Chairman Bill Tielke said the board planned to forge ahead with updating its planning and zoning regulations.

“Everybody recognizes the fact that our comprehensive plan is outdated,” Tielke said, adding he didn’t see a reason to hold off considering any new projects in the meantime.

The current planning and zoning process affords opportunities for public comment and due process to companies requesting a conditional-use permit, Tielke added.

Asking for a show of hands, Tielke said the board wanted to gauge who at the meeting was supportive of several options being entertained by the board.

Twenty-two people raised their hand in support of an 18-month moratorium on any new industrial pipelines, wind and solar energy projects.

More than 40 people raised their hand when asked if they wanted to scrap the proposed moratorium altogether.

Following the informal vote, and with limited discussion, the Holt County supervisors unanimously struck down the planned moratorium passed by the planning and zoning commission.

Tielke, before the vote, read a line from a column by Nevil Speer, a writer for several beef industry magazines, which he said reflected his thoughts on regulation.

“The private sector evolves because that’s what makes sense for business,” Tielke read from Speer’s column. “And regardless how good intentions may be, government generally fails at making things better.”

New regulation, he added, is rarely created without unintended consequences.

After their initial contact with Summit, when they denied the company permission to survey their land, the Crumlys say they aren’t sure whether the plan is for the pipeline to cross their property or not.

The last time they heard from the company was from the land agent, who told them they were no longer on the route and asked how to contact their son, who lives nearby.

Jeanne Crumly refused to give out the number.

Then, the same week that the planning and zoning commission passed its moratorium, an envelope with Summit’s return address in Ames, Iowa, landed in their mailbox.

“Dear Landowner,” it begins. “We appreciate your involvement in this project. Our top priorities are to be transparent and to make sure we do the right thing for landowners for the benefit of Nebraska agriculture.

“We firmly believe this project will positively impact farmer profitability and farmland values for decades to come.”

The Crumlys said the uncertainty — are they or aren’t they on the route, and if they are, does Summit plan to use eminent domain against them? — brings back memories of dealing with TC Energy.

“I don’t know — are we part of it or not?” Ron Crumly asked. “Then it hearkens back to that same sense where they just tell you what they’re going to do instead of converse with you.”

“You just have to be vigilant,” Jeanne Crumly said.