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South Dakota Gov. Noem touts company that receives funding under Inflation Reduction Act

The Republican governor opposed the law that Gevo, Inc., credits for supporting its production of sustainable aviation fuel.

By Oliver Willis - March 29, 2023
South Dakota Gov. Kristi Noem speaks at the Conservative Political Action Conference (CPAC) Friday, Feb. 25, 2022, in Orlando, Fla.
South Dakota Gov. Kristi Noem, speaks at the Conservative Political Action Conference (CPAC) Friday, Feb. 25, 2022, in Orlando, Fla. (AP Photo/John Raoux)

The company behind a project touted by Republican South Dakota Gov. Kristi Noem as a major economic development for her state is set to benefit from the 2022 Inflation Reduction Act, which Noem opposed.

In her 2023 State of the State address on Jan. 10, Noem pointed to a plant under construction by biofuel manufacturer Gevo, Inc., in South Dakota as a sign of economic growth during her tenure. Colorado-based Gevo has said the facility will produce 55 million gallons of sustainable aviation fuel a year after the plant begins operating in 2025.

“In the last year, we also broke ground on the largest economic development project in our state’s history. Gevo’s Net-Zero 1 Site in Lake Preston is the first ever billion-dollar investment in South Dakota,” Noem said. “They will literally turn corn into jet fuel, as impossible as that sounds.”

In a press release sent out by the state government on Sep. 15, 2022, Noem called the facility a “world-class sustainable fuel production facility” and said that it proved that “government mandates are not necessary for our energy industry to be environmentally responsible.” However, in an Oct. 10, 2022, press release, Gevo praised the 2022 Inflation Reduction Act and its federal investments in clean energy that it said it “expected to energize our business and the shift to renewable energy.”

The release said the act, signed into law by President Joe Biden on Aug. 16, 2022, “promises to be helpful to many companies working in the energy transition and in particular those in the renewable energy industry.”

Patrick Gruber, the company’s CEO, said, “The passage of the Inflation Reduction Act is a game changer and is expected to reward companies like ours that drive to net-zero emissions.”

The release highlighted the specific provisions of the law written to assist producers of sustainable aviation fuel, including tax credits for such companies. It said: “The IRA is very positive for sustainable aviation fuel specifically, putting forth a two-phase approach to encourage investment [in] the production of SAF. Gevo is proud to have been tentatively awarded up to $30 million by the U.S. Department of Agriculture to advance its Climate-Smart Farm-to-Flight initiative. This award and program are expected to be finalized in the coming months.”

On the Department of Agriculture’s website, the Gevo project is described as part of a plan to “accelerate the production of sustainable aviation fuel to reduce the sector’s dependency on fossil-based fuel.”

Noem specifically opposed passage of the Inflation Reduction Act when it was under consideration by Congress, signing on to an Aug. 4 joint statement with 20 other Republican governors released Aug. 4 that called the bill “another reckless tax and spending spree.” The letter claimed, “With sky-high prices at the pump, the last thing Americans need is for Democrats to punish energy producers, which will ultimately hurt working families struggling to pay for gas, goods, food, and utilities.”

The legislation passed Congress with only Democrats voting for it.

The bill had strong support from environmental groups. Ramón Cruz, the president of the Sierra Club, said before its passage, “Once passed, this transformative legislation will be the single largest investment in our communities – including those that have long been disproportionately impacted by climate-fueled disasters – and a healthy and secure future for all of us..”

The Inflation Reduction Act is expected to invest about $360 billion in efforts to fight climate change by funding projects related to clean energy production and climate-related technology. The nonpartisan clean energy transition group RMI projected that that funding combined with funding under the CHIPS and Science Act and the Infrastructure Investment and Jobs Act, both signed into law by Biden, will total $514 billion invested in green energy policy over the next 10 years.

Published with permission of The American Independent Foundation.

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