In just six months since passage, the Inflation Reduction Act has spurred $50 billion in new investment and created more than 100,000 new jobs across the United States. A clean energy boom is underway thanks to fast-falling renewable costs and new IRA tax credits. But what does that mean for Utah?
New wind and solar was already out-competing coal in most places, but IRA tax credits accelerate this trend. A new study finds these new economics mean continuing to operate our state’s aging coal plants costs 50% more than replacing those facilities with new wind, solar and batteries.
Replacing Utah’s coal plants with local solar would save utilities about $260 million a year in operating costs — enough to fully replace the electricity each existing plant provides with solar and batteries. In other words, we can store all that clean energy for whenever electricity demand heats up, at no extra cost.
IRA incentives for coal communities make this deal even better. A bonus tax credit for building clean energy in coal communities is designed to create new economic opportunities for the regions that powered America’s economy for decades, and the IRA also offers financing at below market rates specifically for these new investments.
Tapping our share of federal funds to build new clean energy could also attract $15 billion in new investment to our communities — but the financing application closes in 2026, and the tax credits expire in 2032. Expected retirement dates for the Huntington (2036) and Hunter (2042) coal plants arrive after IRA funding expires, so Utah’s utilities must start planning right now or risk missing this generational opportunity to revitalize our rural communities, clean our air, save water and attract billions.
Building new renewable energy projects near existing coal plants provides three additional benefits.
First, coal plants don’t need to immediately shut down for the projects to break ground. We can build new clean energy projects well ahead of retirement, so they are ready to power up just as the coal plant powers down, creating a smooth transition for the electricity grid and for the community.
This is exactly what NV Energy is doing over the border in Nevada — two new solar projects with storage are being built across the street from the state’s last coal plant and will be ready just before the plant goes offline.
Second, building new solar, wind and storage near a retiring coal plant qualifies the projects for the IRA bonus tax credit and low-cost financing. It also allows developers to use the plant’s existing transmission and interconnects, saving even more money, and speeding up the timeline to completion.
Third, building projects near a retiring coal plant brings new economic activity to the same communities that economically depend on coal through thousands of construction jobs, new long-term clean energy jobs, and stable tax revenue for decades.
In fact, the new wind, solar and battery storage projects can anchor new clean industrial hubs for broader economic redevelopment and revitalization. Nearby land can be used for larger renewable projects to capture all our rich wind, solar and geothermal resources. Businesses increasingly seeking clean energy can be attracted to open new operations. And towns with clearer skies can draw new remote workers and outdoor enthusiasts. All of this economic activity makes for a bright future for Utah’s energy communities.
Utah is an energy state and we’re proud of that history, but if we don’t act quickly we risk ceding billions in federal funds and private investment to neighboring states. As our electricity utilities and regulators review their plans and prioritize investments, they should account for all the IRA has to offer. Looking forward to cleaner air and a stronger economy means setting near-term retirement dates for Utah’s remaining coal plants and drawing up the blueprints for our new energy future.
As two Utahns who care deeply about the future of our state, with so much left on the table, why wait?
Nate Blouin represents District 13 in the Utah Senate and works in the renewable energy sector.
Sara Baldwin is the electrification director at Energy Innovation Policy & Technology, the organization that produced the new analysis. She is a fifth-generation Utahn and currently lives in Salt Lake City.