Summit fined $10K for early easement acquisitions

The Iowa Utilities Commission fined a carbon dioxide pipeline company $10,000 for acquiring land easements too early from another company for expansions of its project.

The commission's Monday order was in response to complaints from the project's opponents who argued Summit Carbon Solutions violated state law when it obtained the easements from Navigator CO2, which abandoned its competing project last year. The move enabled Summit to expand its pipeline network by connecting ethanol plants to the network that previously had been part of the Navigator proposal.

The commission earlier this year approved the company's initial 690 miles of pipe that might transport captured carbon dioxide from ethanol producers in Iowa to North Dakota for underground storage.

It is now seeking more permits to lengthen the system by about 50 percent, and would connect to a total of 30 of the state's 42 ethanol plants.

Summit announced in August it was acquiring an unspecified number of land easements from Navigator for the expansion. The easements would allow Summit to build and operate its pipeline on land it doesn't own.

But that happened before it held public informational meetings for the expansion. Iowa law requires the meetings to happen before pipeline companies negotiate and obtain the easements.

That led Bremer County to challenge Summit's easement acquisitions from Navigator. The Sierra Club of Iowa and others joined the county's challenge to seek a commission's decision to nullify the acquisitions and force the company to renegotiate them.

The commission denied that request as "illogical," but agreed that Summit had acted too early and fined it $10,000.

"The commission finds the gravity of the violation to be minimal, but still worthy of deterrence via the civil penalty," the commission, whose three members are appointed by the governor, wrote.

It said Iowa law does not give the commission the authority to cancel easement agreements.

"Summit Carbon Solutions believed we were in compliance with the IUC's regulations and didn't expect Navigator to be considered a landowner for the purposes of the informational meeting," the company said in a statement. "While the commission noted the violation as minimal, we acknowledge the issue and are moving forward in compliance with the order."

The Sierra Club said it was pleased with the partial victory but said Summit deserved a heftier fine: "Ten thousand dollars is nothing to a billion dollar company," said Jess Mazour, conservation coordinator for the group.

Summit estimates its 2,500-mile pipeline network in five Midwestern states will cost about $8 billion. The company initially hoped to have it operational this year, but its plans have been delayed by regulatory setbacks in the Dakotas.

North Dakota utility regulators rejected Summit's first permit request but are reconsidering it with changes. South Dakota also denied the company's application, but Summit has said it intends to reapply. The Iowa Utilities Commission said the company cannot start construction in Iowa until it obtains permits in the Dakotas.

The Sierra Club and others have filed lawsuits to challenge the commission's issuance of a permit for Summit's initial proposal in Iowa. It's unclear when they will conclude.

The suits argue that the project should not be eligible for the use of eminent domain to force unwilling landowners to host it on their properties. The commission gave Summit permission to use eminent domain for about a quarter of its initial route in Iowa.

Comments: (319) 368-8541; jared.strong@thegazette.com