Pipeline Company to Begin Neb. Operations

By Paul Hammel, Nebraska Examiner

LINCOLN — A Kansas pipeline company is about to activate its $1.5 billion pipeline to transport carbon dioxide from ethanol plants in Nebraska and Iowa to a sequestration site in Wyoming and, along with it, launch a first-of-its-kind program to share some proceeds with rural communities along the pipeline route.

On Tuesday, officials with Tallgrass Energy said they would soon be shipping CO2 from the first of 11 ethanol plants connected to its pipeline — a converted, former natural gas pipeline — for a 392-mile trip across Nebraska, Colorado, Iowa and Wyoming.

In conjunction with the launch, Tallgrass announced it is making an initial donation of $500,000 to a fund managed by the Nebraska Community Foundation that could financially help more than 230 communities and community organizations on the route.

The company projects that more than $7 million will be distributed over 10 years through the “Trailblazer Community Investment Fund,” with the money targeted for local early childhood centers, elder care facilities and food pantries. That is on top of lease payments to landowners and spending more than $450,000 on disaster response training sessions and equipment purchases for the mostly rural, volunteer fire and rescue departments along the pipeline route.

Summit pipeline changes

A much larger CO2 pipeline proposal, the 2,500-mile Summit, recently announced plans to provide more incentives for landowners who provide rights of way and new aid to local communities along the route, DTN/Progressive Farmer reported.

That pipeline, first proposed three years ago, would connect to 57 ethanol plants across North Dakota, South Dakota, Minnesota, Iowa and Nebraska. But the Summit project has faced fierce landowner opposition in some areas, along with lawsuits and regulatory barriers.

Kleeb, of Bold Nebraska, said the offer by Summit is different than what was negotiated with Tallgrass. Summit, she said, just laid out an offer, and did not work out the new incentives with local officials.

The new offers from Summit were described by Summit CEO Joe Griffin as “a promise to operate safely, openly and in a way that brings meaningful benefits to the people and places that make this project possible,” DTN reported.

Tallgrass is still going through the process to gain regulatory approval in Iowa for building the small portion of its pipeline in that state. But a company spokesman said 100% of the rights of way needed in Iowa had been obtained, removing that hurdle toward the project’s approval there.

— Paul Hammel

The investment fund was negotiated with the environmental group, Bold Nebraska, which was a leading opponent of construction of the Keystone XL crude oil pipeline across the state. The agreement has been hailed as a new blueprint for acceptance of large infrastructure projects that impact rural areas.

“It’s important to us to strategically invest back into the communities who have supported the project’s development,” said Kyle Quackenbush, segment president at Tallgrass.

“We hope that these investments serve to provide a safety net to our neighbors throughout their lifetimes – from early childhood to eldercare – so that these communities can continue to grow and thrive,” he said.

A year ago, Tallgrass announced its agreement with Bold Nebraska to share some of the proceeds in exchange for its cooperation.

Such pipelines in other states have generated opposition, as well as lawsuits and protests. In this case, though, extensive new rights of way weren’t necessary, and many landowners along the pipeline route grow corn, a crop expected to benefit from expanding the markets for corn-based ethanol by making the fuel more environmentally friendly.

Jane Kleeb, the founder of Bold Nebraska, said rural communities “deserve to benefit from the projects that impact them – whether that’s sharing in profits, investing in social services or simply having a seat at the project’s decision-making table.”

Kleeb said the agreement serves as a model for rural as well as urban communities impacted by such projects. She added that Tallgrass and Bold recently gave a presentation to officials with the NAACP.

The new pipeline, formerly the Trailblazer pipeline, is the first of its kind to begin operation as part of a push by the Biden Administration to reduce carbon emissions and make ethanol production more “green.” Making the biofuel less carbon-intensive could make it more attractive for states seeking environmental benefits, officials have said, and the pipeline will give Nebraska-produced ethanol an advantage in its use as sustainable aviation fuel, a new market for the biofuel.

“It’s going to put Nebraska ethanol into a league of its own,” said Steven Davidson, a Tallgrass spokesman.

Jeff Yost, president and CEO of Nebraska Community Foundation, said the new community fund will target some of the biggest challenges facing rural communities — quality early childhood education, senior care and food insecurity — providing small grants to sustain jobs and services.

He said the foundation has already identified more than 230 organizations in the 31 impacted counties as eligible for a portion of the funds. To share in a portion of the funds, Yost said that qualified organizations will be invited to submit applications and verify that they are doing the work they profess to do.

Yost added that sometimes companies do this kind of fund sharing “for public relations purposes.”

“(But) I see these guys doing it for the right reasons,” he said.

This story was originally produced by Nebraska Examiner, which is part of States Newsroom, a nonprofit news network which includes Kansas Reflector, and is supported by grants and a coalition of donors as a 501c(3) public charity.