2025 A s of the stroke of midnight on March 7, the 2025 legislative session is in the books! This year saw a few themes emerge, with energy at the forefront: • Oil and Gas: While there were many bills that have a nexus with our industry, and we vigilantly watch for unintended consequences, there were two major bills directly impacting our industry. SB234 will provide significant financial incentives for those producers developing infrastructure and emission reduction projects by allowing those who receive a High Cost Infrastructure Tax Credit to directly deduct this credit against their severance tax liability. SB207 has also been a major point of discussion, setting out a new “local impact mitigation tax” of $0.05/bbl on all oil produced and $0.0025/mcf on all gas produced from 2026-29. The bill limits the use of funds back to specific transportation infrastructure and has reporting obligations for those receiving the funding. The bill was effective May 7 and will prohibit counties from imposing similar oil or gas mitigation fees. Both of these bills are worth a close read. SB159 also requires that Class VII landfills (those that take oil and gas wastes) install impervious liners in new facilities or in all facilities no later than July 1, 2030. Legislative Recap • Power (or more commonly referred to as “Energy”): Following the governor’s announcement of Operation Gigawatt, several bills focused on energy policy, some of the most controversial of which were debated and volleyed until the final days of the session. The Senate had internally competing views about how to balance the fine line of creating a regulatory structure that supports large loads (whether those be data centers or other large power users) to invest in our infrastructure and connect to the grid while also protecting existing ratepayers from costs that would be socialized from these new large loads, with two bills SB227 and SB132 duking it out until the fifth (!!) substitute of SB132 ultimately prevailed. We fully expect to see this conversation continue over the interim. Other big energy bills included HB201 requiring full cost attribution for supplemental (non-baseload) resources in integrated resource plans and establishing requirements for calculating generation capacity that focus on baseload power delivery. HB249 aims to expand nuclear power, create the Nuclear Energy Consortium and the Utah Energy Council, establish a process for designating energy development zones and create the Energy Development Investment Fund. HB157 instructs the Office of Energy Development to develop and maintain energy education programs and curricula for grades K-12, provide professional development training for educators, develop energy-related workforce development programs, and establish the Energy Education and Workforce Development Advisory Group, which UPA has a seat on. HB057 establishes additional protections for residential solar customers. • Federalism: There were numerous bills crafted to proactively assert the state’s rights under federalism. HB380 set the stage by stating the presumption that jurisdiction over subject matters not enumerated to the federal government in the United States Constitution remains with the state and that any presumption against state jurisdiction may be overcome only by federal demonstration of specific constitutional authorization. Other related bills included HB464 establishing the state sovereignty fund, HB474 describing by the sponsor as the Utah REINS Act (following the lead from Sen. Mike Lee), HB488 bolstering the resources of Utah’s federalism commission, SCR3 reaffirming Utah’s sovereignty under the principle of federalism and asserting the state’s right to determine its own energy policies, and SJR6 noting the significance of the Supreme Court’s recent “Loper Bright” decision in helping to preserve federalism — urging state agencies to review federal regulations in light of the Loper Bright decision. • Taxes: Several bills aimed to continue Utah’s multi-year effort to provide tax relief. SB71 will expand eligibility for the Social Security tax credit by increasing the income thresholds from $75,000 for households to $90,000, falling short of Gov. Cox’s plan to totally eliminate tax on Social Security benefits, while other legislation sought to amend property tax relief programs, including the Circuit Breaker Homeowner Tax Credit and renter relief initiatives. The legislature also moved multiple bills removing or limiting tax incentives for renewable energy. HB106 continued the state’s five-year march of reducing income taxes, with a rate drop from 4.55% to 4.50%, which for an average Utah family is a return of about $45. 8 UPDATE
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