The Governor’s Office of Economic Opportunity board has approved incentives to entice a California-based company’s subsidiary to build a plant in Utah County to manufacture equipment for uranium enrichment.
Utah Energy LLC, the subsidiary of General Matter Inc., was approved for a pair of incentives at the board’s October meeting last week. The first incentive is for a tax credit of up to nearly $81 million over 20 years for a $1.64 billion project that ultimately would create 200 jobs. The other incentive, a tax credit for up to $16 million over 20 years, is tied to the creation of 793 jobs in a $249 million project.
General Matter has expressed interest in manufacturing equipment at a facility at Camp Williams, and media reports in June quoted Drew DeWalt, General Matter’s vice president of operations, as saying the site also would accept uranium and process it into fuel for small nuclear facilities. During the GOEO board meeting in the afternoon of Oct. 6, DeWalt said the company is focused on component manufacturing and machining and also in fuel production for energy, “both of which are persistent bottlenecks in new power generation and getting new megawatts on the grid.”
During the meeting, the words “nuclear,” “uranium” and “enrichment” were not spoken. Also, GOEO did not email or post on its news website any news release about the two incentives until at least the next day (after Business Journal deadlines) — unusual for the agency, which normally does so moments after incentive approvals by the board.
During the meeting, GOEO and DeWalt said the projects would be part of “Operation Gigawatt,” Gov. Spencer Cox’s initiative to double Utah’s power production over the next 10 years.
Speaking to the GOEO board, DeWalt said the two projects “are individually, and also combined, able to help deliver on the promise of ‘Operation Gigawatt’ and what we’re trying to accomplish in Utah.” Utah is blessed with natural resources, human capital and a great work ethic and “we think we can really help deliver on that promise with energy abundance,” he said.
A key pillar of the initiative is expanded energy production “and we’re a big part of the supply chain for energy production and can help meet those goals in a state like Utah,” DeWalt said.
The projects will “take time to ramp up, considering the constraints of constructing new facilities, hiring and growing our capacity,” he said.
“From a state-level perspective, it’s really about delivering cost-competitive components and fuel for future power generation, and across both projects, it’s bringing hundreds of durable, high-skilled jobs. … So, at a high level, we just wanted to present that to the board and just express our excitement about the prospects of developing these in Utah in a location that we’ve identified.”
“I know that you have worked on this project and I know you had many options, as well,” said Carine Clark, GOEO board chair. “So, I just wanted to thank you and your team publicly for all the work and working through the process, but also being very diligent about making sure that all of our questions were answered as a board and that you were very careful to make sure that we understood the importance of these projects.”
After the incentives were approved, Jesse Turley, chair of the board’s incentives committee, told DeWalt, “We look forward to all the great work you’re going to do here in Utah.”
GOEO documents indicate the project creating 200 jobs would generate new total wages of $489 million over 20 years and new state tax revenue of nearly $270 million during that time. Those jobs would pay an average of $145,515. The project creating 793 jobs would result in new wages totaling nearly $1.3 billion over 20 years, with average pay of $89,945 and new state tax revenue of nearly $53.4 million.
The Military Installation Development Authority (MIDA) has secured a lease for 400 acres of state-owned land within Camp Williams for nuclear energy projects. The 120-year ground lease was approved by the Utah State Armory Board and MIDA in June.
On Sept. 2, Bluffdale City Manager Bruce Kartchner posted a statement about the potential facility at Camp Williams. Although outside the city limits, the proposed location “would be directly adjacent to our community, and the city recognizes that such a project could bring economic and infrastructure benefits to the region,” he wrote. The city also recognizes that such a project also could have negative impacts on our community, he wrote.
At the time, Kartchner said he and Mayor Natalie Hall had met with representatives from General Matter and said “their current focus is on the manufacturing of uranium enrichment equipment, not the enrichment of uranium itself. However, they do hope to enrich uranium in the future if they can clear all the regulatory hurdles.”
Kartchner said the city would continue to evaluate the potential impact of such a project and added that “it’s important to recognize that neither alarmism nor outright dismissal are productive responses to the proposal.”
The GOEO board meeting last week took place in Cedar City in conjunction with the One Utah Summit.
GOEO does not provide upfront cash incentives. Each year that an incentivized company meets the obligations in its contract with GOEO, it will qualify to receive a portion of the new, additional state taxes the company paid to the state.