Carbon Capture: The POET Perspective
As landowners, communities, policymakers, and regulators consider South Dakota’s future and whether carbon capture, utilization, and storage (CCUS) will have a positive impact on that future, much has been said about the biofuels industry. As President and COO of POET, the world’s largest biofuels company that pioneered the industry across the Midwest and placed our headquarters here in South Dakota, the time seems right to weigh in on what’s been said and what our vision is for the future of the bioeconomy.
POET began on a family farm, and for more than 35 years, we've been expanding markets for farmers and increasing the value of grain so families can stay profitable and continue to farm their land. While the bioethanol industry scaled up from less than 1% of the nation’s gasoline supply to more than 10%, U.S. farm income nearly tripled. Land values have more than doubled. We’re proud of the impact we’ve had on rural economies.
Today, some consider CO2 a useless byproduct. But that’s shortsighted. Creating value from CO2 is a way to extend our partnership with family farmers and keep agriculture thriving. As CO2 capture from bioethanol expands, so too will farm incomes, just as they did in the past.
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Regardless of anyone’s personal political views or thoughts on climate change, the marketplace is demanding lower carbon energy, including biofuels, and POET must adapt to stay competitive. Capturing the pure, biogenic CO2 from ethanol plants will not only help us decarbonize bioethanol, but it will also build the market for using CO2 in other applications. Today that market includes beverage carbonation, food processing, municipal water treatment, fire suppression, and agricultural applications. Tomorrow it could include using CO2 as a feedstock for other forms of renewable energy.
Some protest that new energy technologies should be able to take off on their own, immediately, but that’s not been how we’ve developed successful energy innovation in the past. Start-up costs and taking on entrenched incumbents sometimes require incentives. Bioethanol is one of many examples that needed support in the early days, but those incentives eventually went away as the markets became established. Supportive policy for carbon capture is no different, which is why there has been bipartisan agreement to get the industry off the ground for years.
Expanding new markets for bioproducts like CO2 will keep bioethanol production competitive and in turn will also help maintain steady demand for local grain and keep abundant supplies of feed available for years to come. But if we settle for the status quo in South Dakota while other states like Illinois, Indiana, and Ohio move forward with carbon capture by approving pipelines or utilizing suitable geology to sequester onsite, we’ll be left behind. CO2 markets will develop, and those plants with access will thrive. Eventually, South Dakota’s bioethanol plants will no longer be able to compete, posing a serious risk to the South Dakota ag economy. The local demand and corn basis uplift that bioethanol has long provided will evaporate.
Bioethanol has created solutions to every problem we’ve been asked to solve from increasing America’s energy independence to replacing MTBE and boosting octane to improving air quality. Now, we have an opportunity to remove CO2 from the atmosphere and create new markets for its use.
Bioethanol has driven demand for corn and created value for farmers throughout its history, and CO2 is simply the next phase in its evolution. At POET, we have spent countless hours deepening our understanding of CO2 capture. Our due diligence ultimately led to our decision to partner with Navigator on the Heartland Greenway project, and we are confident the project will yield thousands of new jobs, millions of dollars in local investments, and billions in economic growth across our state.
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Finally, it’s important to note that POET takes our responsibility to be good neighbors and stewards of the land seriously and believes all property owners should be treated fairly and respectfully. We support the private property rights of landowners, but we also want to protect the opportunity for those who wish to participate in CCUS projects
Our hope is that Navigator will achieve their goal of reaching voluntary terms with all landowners and can avoid the use of eminent domain altogether. We believe these projects can and should go forward in a way that respects the rights of landowners, exceeds the highest safety standards, and continues our decades-long history of creating value for farmers and the communities we call home.
Jeff Lautt is President and COO of POET, the world’s largest biofuels company, headquartered in Sioux Falls. He currently serves on the Sioux Falls Area Chamber of Commerce and has also served on the South Dakota State Chamber of Commerce. The Watertown native graduated from SDSU with a degree in engineering.
This article originally appeared on Sioux Falls Argus Leader: Carbon Capture: The POET Perspective
