Summit’s Strategy in Iowa: Step in the Right Direction but Community Risks are Likely to Persist
In mid-September, Summit Carbon Solutions announced a new community and landowner partnership program aimed at improving the company’s relations with the local stakeholders.
In mid-September, Summit Carbon Solutions announced a new community and landowner partnership program aimed at improving the company’s relations with the local stakeholders. While the program addresses many existing concerns, some of them are likely to persist as Summit is seeking to modify its pipeline permit in Iowa.
Safety still depends on the federal regulations
Although Summit has stated its commitment to going above and beyond the federal pipeline safety standards and is willing to invest in local emergency response preparedness, current regulatory flux is likely to weaken potential positive effects of the company’s efforts. Among other things, local objections to the pipeline include the demand to wait until the Pipeline and Hazardous Materials Safety Administration (PHSMA) updates its safety standards before the Iowan regulator could approve the project. While the Trump administration has put the update in limbo, the latest developments in Congress indicate that the PHMSA may advance the regulatory review over the short-term with a stronger mandate from the federal lawmakers. However, until then, CO2 pipeline developers are likely to struggle to convince dissenting landowners in the safety of proposed projects.
Landowners now have more incentives to cooperate
Summit’s new strategy mitigates the risk of the use of eminent domain and offers an additional financial incentive for the locals to allow the proposed pipeline on their land. Landowners would receive an annual stakeholder payment at a rate of at least $0.25 per foot of pipeline on their property. If the company is able to obtain 100% of voluntary easements along the pipeline route, the rate will increase to $0.50 per foot. The payment would be available to affected landowners throughout the life of the project. In that case, landowners could be encouraged to work together to ensure the maximum level of voluntary participation and, by extension, the maximum level of compensation. However, the duration of the easements could become a stumbling block. Although the project is set to run for a couple of decades, many landowners are concerned that easements could be signed for the duration of 99 years. Therefore, as public consultations submissions suggest, the company could sell land to another player when the project ends, perpetuating uncertainty about the future of the property.
In addition to landowners, Summit would also offer a financial incentive to counties, which is likely to mitigate the risk of local authorities’ resistance to the proposed pipeline. Each county along the CO2 pipeline route would be eligible to an annual grant of $0.125 per foot of the pipeline running through a county. If 100% of landowners in the county sign voluntary easements, the grant would increase to $0.25 per foot. Thus, the company creates an incentive for local authorities to engage with landowners who oppose the project and encourage them to potentially change their stance.
Petition to amend the permit could undermine trust
An attempt to modify the language of the current permit in Iowa is likely to reinforce existing opposition to the project and further erode trust in Iowan regulators. In 2024, the Iowa Utilities Commission (IUC) approved Summit’s application under the condition that construction could only start when the company had route permissions from North Dakota and South Dakota, and a storage permission in North Dakota. South Dakota’s Public Utilities Commission (PUC) has rejected Summit’s application twice. Following the enactment of the ban on the eminent domain use for CO2 pipelines in South Dakota in March 2025, the company asked the PUC to suspend the project application review indefinitely as it was unable to meet the deadlines under the circumstances.
The situation in South Dakota makes it impossible for Summit to initiate construction in Iowa, delaying the project indefinitely. Therefore, the company is petitioning the IUC to modify the language of the permit and remove the reference to South Dakota and North Dakota, stating the construction cannot begin until the company has “secured access to one or more sequestration sites and permits or agreements to allow it to reach such storage”. The opponents of the move claim that it is too big to pass as an amendment, and they also demand that Summit releases the details of the potential alternative routes and storage sites. If approved, the amendment is expected to prompt a legal challenge from activist groups against the regulator, which is likely to exacerbate the uncertainty around the project in Iowa.