CO2 pipeline moratorium and land-agent regulations advance, but environmental analysis bill fails
PIERRE – In South Dakota's ongoing debate over carbon capture pipelines, lawmakers advanced two bills to further regulate those projects Tuesday but rejected one that would have required in-depth environmental assessments.
The bills are among several filed in response to controversy over Iowa-based Summit Carbon Solutions' proposed $9 billion, five-state pipeline that would pass through eastern South Dakota.
The project would transport captured carbon dioxide emissions from more than 50 ethanol plants to an underground storage area in North Dakota. While supporters view it as a critical step toward bolstering the ethanol industry, opponents are concerned about private property rights and safety risks from potential leaks.
One of the bills that passed the House of Representatives, 40-30, seeks to halt the construction of carbon dioxide pipelines in South Dakota until the federal Pipeline and Hazardous Materials Safety Administration finalizes new safety regulations.
'This bill simply asks that we take the time to sit back, take a step back, and wait until these rules are finished,' said the bill's sponsor, Rep. Richard Vasgaard, R-Centerville.
Supporters said the moratorium is essential to safeguard residents and ensure that comprehensive safety standards are in place before proceeding with such projects.
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Opponents said existing regulations are sufficient and that delaying pipeline development could hinder economic opportunities and deter investment in the state's energy sector.
The bill goes to the Senate next.
Another bill headed to the Senate empowers landowners to sue for allegedly deceptive practices, fraud, harassment, intimidation or misrepresentation during the acquisition of land access agreements — known as easements — by carbon pipeline land agents. It passed the House 36-34.
Supporters alleged there have been numerous instances when landowners faced aggressive or misleading tactics from CO2 pipeline land agents. They said the bill provides the necessary legal recourse and promotes fair negotiations.
'Why is it OK for these companies to treat us like this?' said the bill's sponsor, Rep. Kaley Nolz, R-Mitchell.
Opponents said such misconduct is already illegal. They said the bill's provisions might be overly broad, potentially complicating legitimate infrastructure projects and leading to increased litigation.
'This bill is a lawyer's dream,' said Rep. Steve Duffy, R-Rapid City.
A bill failed that would have mandated any applicant seeking a permit for a carbon dioxide pipeline to have an environmental impact statement.
Opponents said the requirement could introduce bureaucratic delays, increase project costs and discourage companies from pursuing energy projects in South Dakota.
Supporters emphasized the necessity of thoroughly assessing potential environmental consequences, like the impact on the state's water resources, before project approval.
'We are literally, in my opinion, walking blind into a huge project that is going to use millions of gallons of water,' said bill sponsor Rep. John Hughes, R-Sioux Falls.
However, because the bill also included a permanent application fee increase, the House speaker ruled that the bill required a two-thirds majority. The vote was 37-32, which was short of two-thirds, and the bill failed.
The Summit project may ultimately need eminent domain to gain land access from unwilling landowners. Eminent domain is a legal process for obtaining that access with just compensation determined by a court, for a project beneficial to the public — traditionally for projects such as electrical power lines, crude oil pipelines, water pipelines and highways.
A bill to ban eminent domain for carbon pipelines passed the House last month and is awaiting action in the Senate.
Another bill approved by the Senate earlier this week would retain eminent domain as an option. But it would require entities using it to first attend mediation with the affected landowner and to also have a state permit before commencing eminent domain proceedings.
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