LINCOLN - A bill to ensure that Nebraska ethanol plants can qualify for state tax incentives for building carbon-capture facilities is running into opposition from a leading environmental group.
The Bold Alliance, which includes Bold Nebraska, the group that led the fight against the Keystone XL crude oil pipeline, testified last week against a proposal to ensure that state ImagiNE Act tax breaks are allowed for the “capture, transport or geologic storage” of carbon dioxide, a leading greenhouse gas.
There are at least two companies looking to build CO2 pipelines that cross Nebraska. The gas would be transported in liquid form, under high pressure, from ethanol plants and other manufacturers to storage deep underground.
A Bold Alliance representative testified at a legislative hearing Wednesday, January 2 that it is unnecessary to provide tax breaks for projects that are already planned in the state. They also noted that CO2 pipelines are risky and not subject to state regulation.
Advocates for the tax breaks have said that building carbon storage facilities will benefit the state's environmental rating, which would, in turn, allow them to increase sales to states such as California and Oregon.
Now a year after state lawmakers passed a law that allows carbon storage facilities, State Sen. Dan Hughes introduced Legislative Bill 801, which he said would clarify that Nebraska's ethanol plants can get tax incentives if they build a storage facility on their own property.
Hughes said current law provides incentives for CO2 pipelines that cross state borders but does not allow tax breaks for CO2 facilities that service only in-state customers.
Tony Goins, the director of the Nebraska Department of Economic Development, came to the same conclusion and conveyed this to the Legislature's Revenue Committee during the public hearing.
“It’s a very big deal,” the senator said. “It would certainly give Nebraska ethanol plants a greener rating to sell ethanol in the California and Oregon markets.”
Ken Winston, the Bold Alliance representative, testified that tax incentives should be provided to attract new businesses and jobs to the state, not to benefit currently existing projects that have already chosen to locate here.
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