Iowa 2025-2026 Regular Session

Iowa Senate Bill SF2069

Introduced
1/21/26  

Caption

A bill for an act imposing a tax on the transportation of liquefied carbon dioxide through pipelines, and providing for penalties.

Impact

The implementation of this tax will have significant implications for state revenues, as funds generated from this tax will be channeled into the taxpayer relief fund established under Iowa Code. Pipeline companies will need to maintain detailed records of CO2 transported and comply with new filing requirements, including submitting an annual return by March 31 of the following tax year. This change aims to ensure accountability and enhance transparency in the pipeline sector's operations, creating a new revenue stream for the state while promoting environmentally conscious practices for carbon management.

Summary

Senate File 2069 introduces a new tax on the transportation of liquefied carbon dioxide (CO2) through pipelines within the state of Iowa. This bill establishes a tax rate of $2.50 per metric ton for CO2 transported, with a reduced rate of $1 per metric ton for CO2 used in enhanced oil recovery processes. Enhanced oil recovery is defined as advanced techniques to extract stranded crude oil from reservoirs after initial extraction methods have been exhausted. The bill directs the state Department of Revenue to oversee the tax collection process and require reporting from pipeline companies regarding their CO2 transportation activities.

Contention

Potential points of contention arise around the implications of imposing such a tax. Supporters may see it as a progressive step towards regulating carbon emissions and incentivizing the use of CO2 for enhanced oil recovery. However, opposition may argue that it could overburden pipeline companies financially and disincentivize investments in carbon transport infrastructure. Furthermore, the penalties outlined for non-compliance with the tax regulations introduce a layer of enforcement that may motivate pipeline operators to comply but also raises concerns about the administrative burden placed on the companies involved. The balance between environmental goals and economic viability will likely be at the forefront of discussions concerning this bill.

Companion Bills

No companion bills found.

Previously Filed As

IA SF249

A bill for an act relating to damages incurred due to releases of carbon dioxide from liquefied carbon dioxide pipelines or carbon dioxide facilities and including effective date provisions.

IA HF413

A bill for an act relating to damages incurred due to releases of carbon dioxide from liquefied carbon dioxide pipelines or carbon dioxide facilities and including effective date provisions.

IA SF225

A bill for an act relating to pipelines transporting liquefied carbon dioxide, including permit renewal and operation limitations.

IA HF780

A bill for an act relating to pipelines transporting liquefied carbon dioxide, including permit renewal and operation limitations.(Formerly HF 238.)

IA HF238

A bill for an act relating to pipelines transporting liquefied carbon dioxide, including permit renewal and operation limitations.(See HF 780.)

IA HB1295

The carbon dioxide pipeline exemption, payments in lieu of taxes for certain carbon dioxide pipeline property, and the carbon dioxide capture and injection sales tax exemption; and to provide an effective date.

IA AB881

Public resources: transportation of carbon dioxide.

IA SF299

A bill for an act establishing the Iowa carbon dioxide disaster relief fund, creating an excise tax, and making appropriations.

IA SB614

Public resources: transportation of carbon dioxide.

IA HB0244

Carbon dioxide pipelines-eminent domain prohibition.

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