Pipe Dreams

How to cash in on federal climate tax credits...by shuttling ethanol emissions across five states.

- Tom Philpott

FOR MOST OF his 30-year career, lowa farmer Dan Wahl never knocked heads with his state's agribusiness goliaths. He was too busy tending his crops and cattle on 640 acres of land. But then, in September 2021, a subsidiary of a private equity firm called Summit Agricultural Group started mailing packets to farmers in his area, pitching its plan to build a 2,000mile pipeline through 30 lowa counties as a way of breathing new life into the state's troubled ethanol industry. The pipeline, dubbed the Midwest Carbon Express, would slash across Wahl's farm on its way to grab carbon dioxide generated by 31 corn ethanol plants in five states. It would carry the CO₂ to North Dakota, where the gas would be buried underground. By burying ethanol's carbon waste, the project would make the fuel more climate-friendly, and by bolstering the ethanol trade, it would boost the price of corn, benefiting the state's farmers, the pitch goes.

Wahl didn't take the idea seriously at first. But then he heard from some neighbors that Summit was prepared to appeal to the lowa Utilities Board to seize any land not ceded through voluntary easement. That suddenly sounded to Wahl like a credible threat. After all, Summit's founder and CEO, Bruce Rastetter, is a heavyweight in Republican lowa politics with close ties to the state's past and current governors who have appointed members of that very board.

An agribusiness magnate, Rastetter has deftly leveraged his wealth to gain political influence. His generous campaign donations to and chummy relations with his home state's GOP power structure inspired Politico to deem him the "real lowa kingmaker." Now he's making what could be his biggest play yet. Summit's Midwest Carbon Express project would take advantage of federal tax credits meant to mitigate climate change-and it is poised to net him and his investors a massive windfall.