Iowa Senate Committee Advances Bill to Tax Carbon Flowing Through Proposed Pipeline

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An Iowa Senate committee has cleared a bill that would tax liquid carbon dioxide transported through a proposed pipeline. Republican Sen. Dan Dawson of Council Bluffs says the state has invested heavily in the ethanol industry and is interested in establishing a tax on carbon shipped out of Iowa ethanol plants. However, pipeline developer Summit Carbon Solutions opposes the bill, arguing it would increase project costs.

Why it matters

The proposed pipeline has faced opposition from landowners concerned about eminent domain issues, and this new tax proposal adds another layer of complexity to the project. The bill's advancement signals lawmakers' intent to exert more control over the carbon capture and storage industry in Iowa.

The details

The bill would tax the liquid carbon dioxide flowing through the proposed Summit Carbon Solutions pipeline. Supporters say the tax would help the state recoup its investments in the ethanol industry, while the pipeline developer argues the tax would increase overall project costs.

• The Iowa Senate committee cleared the bill on February 5, 2026.

What’s next

Lawmakers say they will continue working on how the state tax would be assessed as the bill moves through the legislative process.