All four Iowa House Republicans lobbied to protect tax credits for carbon dioxide storage in House Republicans’ debt ceiling bill after raking in thousands in donations from a donor involved in CO2 pipeline development, according to campaign finance records.
The Iowa coalition — Reps. Randy Feenstra, Ashley Hinson, Marianette Miller-Meeks and Zach Nunn — refused to back Republicans’ Limit, Save, Grow Act until their colleagues removed language that would have rolled back tax credits supporting carbon pipelines, according to multiple reports. The act narrowly passed the House in a near party-line vote in late April with the Iowans’ support, and the tax credits are not touched in President Joe Biden and Speaker Kevin McCarthy’s final debt ceiling deal.
The Iowan representatives have each received substantial campaign contributions from prominent Republican donor Bruce Rastetter, CEO and co-founder of Summit Agricultural Group, an agricultural investment firm whose affiliate, Summit Carbon Solutions, has proposed a carbon pipeline project in the state. Nunn’s campaign received $6,600 in February, Hinson’s and Miller-Meeks’ political action committees or campaigns received $11,600 and $5,800 respectively in late March, while Feenstra’s campaign and affiliated committee most recently received $15,800 in contributions from Rastetter in March 2021, according to federal filings.
Though Feenstra did not receive any donations from Rastetter himself since March 2021, towards the end of the year he received $1,400 combined from Summit Agriculture Group President Eric Peterson and Summit Ag Investors President and Summit Carbon Solutions board member Justin Kirchhoff, and $1,500 from Matthew Vining, CEO of fellow pipeline developer Navigator CO2, according to federal filings. The majority of Navigator’s 1,300 mile Heartland Greenway pipeline would be located in Iowa. (RELATED: California Environmental Group Sent Lawmakers On Emissions-Spewing Flights To Study ‘Climate’ Policies, Green Tech)
“Generally the largest beneficiaries [of the pipelines] will be large multinational companies and their investors on Wall Street,” Thomas Jones of the conservative American Accountability Federation, who described Rastetter as a “mega-donor” that was “working feverishly” to protect the tax credits, said in a statement to the DCNF. “The losers — well that’d be family farmers who will get multi-generational farms destroyed by the pipeline. The federal taxpayer will lose when there is a massive wealth transfer from working class taxpayers to wealthy companies.”
Summit Carbon Solutions has proposed roughly 2,000 miles of pipelines running through five states — 680 miles just in Iowa — that would capture the emissions of ethanol production facilities before ultimately sequestering them deep underground in a North Dakota site. These pipelines would allow the 34 partnered ethanol production facilities to emit net zero carbon emissions by 2030, helping them remain compliant with increasingly strict state and federal regulations requiring low-carbon fuel production, according to the company.
The Section 45Q credits supporting these pipelines were first introduced in 2008, but were dramatically expanded by President Joe Biden’s Inflation Reduction Act in 2022, which increased the number of projects that could qualify, and offered a credit of $85 per ton of carbon dioxide permanently stored underground, according to the International Energy Agency. These credits could generate nearly $2 billion per year collectively for pipeline developers Summit, Navigator CO2 Ventures and Wolf Carbon Solutions, totaling roughly $23 billion over the 12 years the projects would qualify for the programs’ benefits, according to a report by corporate watchdog Food & Water Watch.
“I think that’s why we don’t see support from a lot of elected leaders, whether federal or state,” Jess Mazour, executive director of the Iowa Chapter of the environmentalist organization Sierra Club, which opposes the construction of the pipelines, told the DCNF. “They’ve been bought off already.”
In February, a study commissioned by the Iowa Renewable Fuels Association (IRFA) — which supports tax breaks for carbon pipelines — found that if Iowa’s ethanol industry did not take advantage of tax credits to support the construction of carbon pipelines, the state would lose 75% of its total ethanol production and lose as much as $10.2 billion per year in five to 10 years. Summit Carbon Solutions spokesperson Jesse Harris cited this report in a statement to the DCNF, stressing the importance of the industry to the Iowan economy.
“I think it’s important to take a step back and highlight why these policies are so critical to the Midwest economy,” Harris said. “Here in Iowa, the ethanol industry supports 50,000 jobs, contributes $6.1 billion to our state’s GDP every year, generates more than $3 billion in household earnings annually, and purchases 57% of the corn grown in Iowa. It’s a critical driver of land values and commodity prices. Carbon capture projects will protect and enhance this industry.”
Beyond the ethanol industry, Rastetter’s Summit Ag has connections with China through FS, a $115 million ethanol partnership between Summit and Brazilian grain company Fiagril. Fiagril was acquired by Chinese firm Hunan Dakang in 2016, and received a $300 million loan from the Chinese government’s China Development Bank (CBD) in 2019, which was intended to help boost the struggling firm through 2022, according to Reuters.
The offices of Feenstra, Hinson, Miller-Meeks and Nunn did not respond to questions from the DCNF about whether funding from Rastetter had influenced their stances on the relevant tax credits. Harris said that Summit was glad Iowa’s “entire delegation” stood up for the ethanol industry, and that any member of its “bipartisan team” was “welcome” to donate to the political candidates of their choice, including Rastetter, who has “been donating… at the federal, state, and local levels for decades.”
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