SPRINGFIELD — An engineer for the Illinois Commerce Commission is recommending the denial of a Gibson City ethanol facility’s application for a permit to build and operate a 7.34-mile carbon dioxide pipeline in western Ford and eastern McLean counties, citing in written testimony the number of uncertainties surrounding the project’s viability and safety.
Opponents of the $19 million project proposed by One Earth Sequestration LLC — a subsidiary of the ethanol facility’s owner, One Earth Energy LLC — applauded the recommendation for denial this week, saying it shows the ICC is taking seriously the many concerns they have already raised since OES filed its application for a certificate of authority with the ICC last October.
“This is a demonstration that organizing works,” said Dawn Dannenbring, lead climate organizer for Illinois People’s Action, a citizens group that has been campaigning against the OES Pipeline project. “These CO2 projects only benefit corporations while putting thousands of people at risk, and endanger our water supply that over 1,000,000 residents depend on. People just won’t stand for it.”
One Earth Energy’s ethanol plant at 202 N. Jordan Drive in Gibson City.
The testimony recommending denial of OES’s permit application came from Mark Maple, a senior gas engineer in the energy engineering program of the ICC’s Safety & Reliability Division, and was filed on Wednesday, Feb. 28, just before the deadline expired for ICC staff and so-called “interveners” to do so. Similar denial recommendations were made by ICC staff in the cases of two previous CO2 pipeline permit applications — for Navigator CO2’s Heartland Greenway Pipeline and Wolf Carbon Solutions’ Mt. Simon Hub CO2 Pipeline — leading to both permits being voluntarily withdrawn.
OES’s application remains pending, though, with a deadline of Wednesday, March 27, for the firm to provide rebuttal testimony. That deadline will be followed by a series of other rebuttal deadlines and then five days of evidentiary hearings on May 20-24 before Administrative Law Judges Daniel Coultas and Jessica Cardoni, who are expected to enter a proposed order around July 29 and final order by Sept. 18.
In his testimony, Maple pointed out OES’s lack of progress in securing other necessary permits, landowner contracts and easements, establishing an emergency response plan for pipeline ruptures, and finalizing a budget to provide funding for local emergency-response agencies that would need to buy special equipment and undergo training to respond to such events.
Maple also noted the “outdated and inadequate” federal safety regulations for CO2 pipelines as well as the indication, in the wake of a 2020 pipeline leak in Mississippi, that those rules will eventually be changed by the Pipeline and Hazardous Materials Safety Administration, making this project non-compliant. Maple also noted the abundance of public comments opposed to the project submitted to the ICC.
Many of those same concerns were raised by Illinois People’s Action and other pipeline opponents during a series of public hearings held in McLean County last fall for OES’s application for a special-use permit to construct and operate three 6,000-foot-deep sequestration wells in the Saybrook area that would permanently store the CO2 transported via the pipeline from Gibson City’s ethanol plant. While the application was approved by the McLean County Zoning Board of Appeals, the McLean County Board later rejected it on Dec. 14 due to a number of concerns, but the board indicated that OES could reapply later this year once those concerns were addressed.
Viability in doubt
The McLean County Board’s denial of the special-use permit for the sequestration wells was noted by Maple in his 35 pages of testimony. Also, Maple noted that OES still needs to obtain for the sequestration site a UIC Class VI permit from the U.S. Environmental Protection Agency — which is not expected to be received until “sometime between August 2024 and January 2025” — in addition to other required permits from both Ford County and the Illinois State Historic Preservation Agency.
“I cannot be certain that OES will eventually obtain all such permits and approvals,” Maple said. “It is especially concerning that the McLean County Board denied the OES permit application, which raises doubts about whether the sequestration sites can be built as planned.”
In denying the special-use permit for the wells — which would inject the CO2 produced by One Earth Energy’s ethanol plant more than 6,000 feet underground beneath the Mt. Simon sandstone formation, where it would be stored permanently — the McLean County Board had expressed concern that OES had not already secured the EPA permit for the wells, specifically.
“It appears that the McLean County Board may not issue its permit until OES has secured its EPA permit,” Maple noted. “This will not occur until at least the second half of 2024 and could be delayed until 2025. Thus, the (ICC) will not have any assurance before the record is closed in this docket that OES can or will obtain all necessary permits to construct the sequestration facilities.”
Maple also noted that the McLean County Board “expressed concern that OES had not completed remediation plans for drinking water and for above-ground accidents,” adding that the board also was concerned that OES had not “finalized plans to purchase necessary equipment for local first responders.
“The board stated that the company could reapply without having to wait for the normal one-year reapplication period if OES has new evidence on the above issues,” Maple said, “but (the board) expressed a preference that OES wait to reapply until everything in the code has been met.”
If the sequestration wells end up not being permitted by either the EPA or McLean County Board, the viability of the project would be in doubt, Maple noted.
“In that scenario, the pipeline would not be constructed,” Maple said. “Alternatively, OES could identify an alternative sequestration site or sites, either nearby in the Mt. Simon formation or in a different location entirely. In that scenario, the pipeline would likely need to be rerouted. … Said another way, if the sequestration sites cannot be constructed, then the pipeline is unlikely to be built as designed, making the issues in this proceeding moot.”
While the lack of permits obtained so far by OES would not alone disqualify OES from receiving its certificate of authority for the pipeline, Maple noted, it does raise concern. At minimum, Maple said, the ICC would need to condition its final order granting a certificate of authority, in part, on OES receiving the necessary permits and approvals prior to starting construction.
“Additionally, the order should be conditioned on OES obtaining all necessary land rights and permits to construct the sequestration facilities, as planned, prior to the start of any pipeline construction,” Maple said.
Maple said it is “highly concerning” that OES has “yet to acquire any of the necessary easements” for the pipeline and the injection wells. As of Feb. 26, Maple noted, OES had obtained 86% of the acreage needed for one well but just 44% for the two others,
“This demonstrates that the company has failed to show that it has negotiated, or even begun to negotiate, in good faith with landowners,” Maple said. “The lack of progress with landowner negotiations at this stage of the proceeding is highly concerning. Further, the fact that OES has not obtained any easements thus far may also display the safety concerns of the public associated with the OES Pipeline, and ultimately supports my recommendation that OES’s Application be denied.”
Under the Carbon Dioxide Transportation and Sequestration Act — also known as the CO2 Act — the ICC must find that “the proposed pipeline is consistent with the public interest, public benefit and legislative purpose” of the law. However, Maple said no such finding can be made due to the uncertainty of the location of the injection well sites and, among other reasons, the uncertain “viability of the entire project” as a result of OES’s “failure to obtain permits and land rights.”
“Without a sequestration facility in place and the end point (of the pipeline route) being uncertain, the entire route remains in flux, and consequently, in my opinion, it is not a benefit to the citizens of Illinois nor in the public interest,” Maple said.
Emergency response plan
Maple also noted OES’s “failure to provide an emergency response plan and to commit to a definitive budget for training and equipping local emergency response units,” which “leaves the (ICC) unable to consider evidence of public safety presented by local governmental units.”
Maple said OES is currently working with emergency service units in Ford and McLean counties to develop revisions to its emergency response plan, which provides response procedures and integrated emergency preparedness for all aspects of the OES carbon capture and storage system. However, OES does not expect to have a draft of its plan available until early 2025, Maple said.
“Collaboration with local emergency response units is critical, because those units must have adequate training, equipment and personnel necessary to respond to an incident,” Maple said, “However, the (ICC) will not get to see the results of these efforts, nor have the opportunity to evaluate or comment on the (plan), prior to the record being closed in this docket.”
Additionally, Maple said, “it is not clear that the local emergency response units will have all the equipment and training necessary to respond to an emergency situation” caused by the pipeline.
“OES has made vague statements about the equipment it will purchase, saying OES will ‘make all reasonably appropriate items of equipment available for emergency response,’” Maple said. “However, OES will ultimately have the final say for what items are ‘reasonably appropriate.’ OES has not committed to a definitive equipment and training budget; nor has it provided a comprehensive list of items and training programs that it is willing to provide.
“In sum, OES is asking the (ICC) to approve the OES Pipeline without getting any feedback from local governmental units on the adequacy of the (emergency response plan), the amount of training offered by OES, the amount of money that OES will actually spend purchasing critical emergency response equipment, and other aspects of its safety planning.”
While the CO2 Act does not explicitly require an applicant to submit an emergency response plan at the time of its application, Maple said “OES’s lack of an emergency response plan is a critical consideration and ultimately severely curtails local governments’ ability to provide evidence, and for the commission to weigh that evidence, on the public safety of the OES Pipeline.”
Rules could change
Maple also noted the uncertain future of federal regulations for CO2 pipelines in the U.S. While OES has already filed all necessary forms with the PHMSA — and “it does appear that OES’s proposed route will meet or exceed the minimum safety standards as currently determined by PHMSA,” Maple said — the PHMSA might change its rules soon, making the project non-compliant, Maple said.
“PHMSA has initiated a rulemaking (process) to implement new regulations for CO2 pipelines,” Maple said. “It is expected that PHMSA will issue new rules for CO2 pipelines that address safety and environmental threats. Thus, to ensure that the OES pipeline is compliant with the expected new rules, the (ICC) should deny OES’s CO2 pipeline application until PHMSA has completed its rulemaking process.”
Maple noted that, in his opinion, the PHMSA’s existing safety regulations for CO2 pipelines “are not sufficient to guarantee the public’s safety in all possible scenarios.”
“Therefore, I cannot say with certainty that all citizens along the (project) route will be safe if a rupture were to occur, such as in areas where the OES Pipeline is close to residential structures,” Maple said. “Further, there is currently much debate about what a safe setback distance should be and whether the current setback distance regulation should be modified. There is currently no PHMSA safety setback regulation for CO2 pipelines. However, it is my opinion that PHMSA’s current regulations, as they pertain to carbon dioxide pipelines, are insufficient to guarantee the public’s safety.”
On May 26, 2022, the PHMSA announced its plan to “implement new measures to strengthen its safety oversight of carbon dioxide pipelines around the country and protect communities from dangerous pipeline failures.” The PHMSA said it would be “initiating a new rulemaking to update standards for CO2 pipelines, including requirements related to emergency preparedness and response.” The announcement came after the PHMSA investigated a CO2 pipeline failure in 2020 in Satartia, Miss., which resulted in evacuations and caused many people to seek medical attention.
“Additionally, on May 31, 2023, and June 1, 2023, PHMSA hosted a public meeting regarding the upcoming carbon dioxide pipeline rulemaking and CO2 public safety in Des Moines, Iowa,” Maple said. “At the meeting, Tristan Brown, the deputy administrator of PHMSA, stated that ‘PHMSA is currently drafting a rulemaking to significantly strengthen the safety and environmental protections for CO2 transportation via pipeline.’ He also stated that PHMSA believed it was ‘vitally important that (PHMSA) establish stronger safety (and) environmental protections.”
Maple recommended the ICC wait to approve any permits for CO2 pipelines — including the OES Pipeline — until the PHMSA finishes its rulemaking process.
“If this project moves forward prior to the rulemaking by PHMSA, OES could construct and operate a pipeline that is later found to be non-compliant with PHMSA’s new rules, and, therefore, could be deemed unsafe to operate,” Maple said. “It is very possible that PHMSA will issue new rules for characteristics such as a minimum setback distance from homes and structures, that could cause OES’s proposed pipeline to not conform with the regulations. It is currently unknown if the issuance of a new PHMSA rule for CO2 pipelines would lead to costly modifications, a shutdown of the pipeline, or grandfathering in the existing non-complying pipeline.”
Maple noted that the “PHMSA has acknowledged that its rules are outdated and inadequate” — and Illinois lawmakers seem to share similar safety concerns, as there is pending state legislation calling for a moratorium on CO2 pipeline construction in Illinois until the PHMSA finalizes its new rules.
“Therefore, it is my opinion that the commission should proceed cautiously,” Maple said.
Eminent domain concerns
OES’s is requesting a certificate of authority to not only build and operate the pipeline but also exercise eminent domain, if needed, to obtain the necessary landowner easements. With zero easements secured so far, Maple said the use of eminent domain should not be used to obtain a majority of them.
“I am not aware of any explicit requirement for an applicant to obtain a certain percentage of land rights through negotiation,” Maple said. “However, I am not aware of any instances where (ICC) staff has supported the granting of eminent domain authority for a pipeline project for which the applicant had not obtained a single easement along the route.
“Typically, in pipeline construction dockets, the applicant is able to acquire the majority of easements through negotiations. Eminent domain is used as a last resort to obtain a small percentage of easements from any holdout landowners that refuse to negotiate. This prevents a small minority of landowners from obstructing a large project to which most landowners along the route have given consent. In my professional opinion, that is how eminent domain should be evaluated and utilized. Using eminent domain to obtain an overwhelming majority of the land for a project demonstrates it is not in the public interest or public benefit.
“While I currently have no reason to believe the company has acted in bad faith, the inability of OES to secure easements in this docket thus far calls into question the public’s sentiment on the pipeline’s safety and necessity. At the very least, it demonstrates that further negotiations with landowners are needed and that OES has not sufficiently demonstrated that it meets the requirements to obtain eminent domain authority.”
Maple noted that the “public comments” section of the ICC’s online docket for the pipeline case shows 42 public comments, the majority opposing the project and expressing safety concerns.
“I recommend the (ICC) consider landowner sentiment when evaluating OES’s application and whether OES ‘has used reasonable and good-faith efforts to acquire the property or easement thereto,’” Maple said.
Common carrier certificate
Lastly, Maple noted a concern that OES has not yet applied for a “common carrier by pipeline” certificate as required under the Common Carrier by Pipeline Act. Maple noted that if the ICC determines that OES is required to obtain such a certificate, the company’s “failure to seek the certificate at this time would be a cause for concern.”
“Staff counsel will address this issue further in briefs,” Maple said.
