Iowa ethanol producers are losing their winning edge to Nebraska with the start of CO2 shipments on the Tallgrass Trailblazer pipeline last week, according to the Iowa Renewable Fuels Association (IowaRFA).
Mid America Agri Products/Wheatland (MAAPW) last week became the first plant to start carbon dioxide capture at its Madrid, Nebraska facility with volumes to be transported on the Tallgrass Energy Trailblazer Pipeline for permanent sequestration in Wyoming.
“Congratulations to Tallgrass for this monumental achievement,” said Iowa RFA Executive Director Monte Shaw. “Huge new markets around the world are demanding ultra-low carbon ethanol and carbon capture and sequestration (CCS) is the best tool to get there. The plants on the Tallgrass pipeline now have a leg up in many ways. IRFA will be working hard to ensure Iowa plants have access to the tools they need to compete.”
Shaw says ethanol plants able to capture and sequester CO2 can reduce their carbon intensity (CI) by up to 33 points, thereby qualifying for up to 66 cents per gallon under the federal tax credit program known as 45Z.
Iowa has been the most profitable place in the world to produce corn ethanol since 2000. As such, the industry expanded in the state to become the largest ethanol producer and many affiliated industries made investments in facilities and operations in Iowa. Last year, ethanol production in Iowa added nearly $5.2 billion to the state GDP, increased household income by $2.5 billion, and supported almost 33,000 jobs.
“For the first time since 2000, Iowa is no longer the best place to produce corn ethanol,” stated Shaw. “Alarm bells should be going off with any leader who values Iowa’s rural economy. We need to work to ensure this is temporary, not permanent. The huge economy-wide benefits that reverberate out from ethanol production in Iowa are not a given. If Iowa does not remain competitive, those investments will flow to areas that are competitive.”
Summit Carbon Solutions, which is working to build a 2,500-mile carbon-capture pipeline through the Midwest, including Iowa, recently filed a petition with the Iowa Utilities Commission to amend its current pipeline permit, approved in August 2024, requesting changes to the route and pipe. The project has been plagued with legal challenges in Iowa, as well as North and South Dakota.