Businesses and cities in Utah are reaping the benefits of federal tax credits that could save millions on solar energy and infrastructure and the cost of installation.
Perennial Favorites, a small Layton plant nursery, is saving more than $5,000 a year with solar installation by taking advantage of the Investment Tax Credit and Rural Energy for America Program (REAP). In Logan, the city is considering the Infrastructure Investment and Jobs Act (IIJA) Direct Pay provision to potentially save millions on a 15-megawatt locally owned solar project.
“Perennial is a family-owned business that started in 1992 in my parents’ backyard,” said CEO/head grower Cort Cox. “It was just a hobby at first, but my dad had a few connections and any money he took in he put back into the business and he saw continual growth.”
The nursery is a seasonal business, said Cox. “At our peak, we have 90 employees and in the off-season we have 60. We have 2 million units that include smaller container plants, edibles and annuals.”
Cox said they have made a big push on growing water-efficient plants. “We’re trying to do our part to make the Utah landscape more efficient but you can still have and enjoy plants. There’s plant growing and shipping costs and energy costs increase every year, so we have to find ways to be efficient.”
The company heard about REAP, he said. “It’s a federally sponsored grant program. It helps a lot. We’re a seasonal business, so with our cash flow it’s hard to fund a project like solar. This is the only way we could put in our solar system.”
The cost for electricity went from $1,200 a month to $500 in 2024, said Cox. “With all of the incentives and the tax grant, we were able to recoup the installation cost. That’s critical to our ability to add staff and the operation to produce more plants.”
For outside growing, they rely on the sun, he said. “Our production building and office all generate electricity.”
Cox said he has future plans to expand his business. “We have a 64-kilowatt system covering a third of our electricity. We want to do that much again. We want our electric bill as a whole to roughly drop that same percentage.”
That would make it possible to expand to other areas, he said. “Our storage building and green house would be 100 percent solar-generated in the next phase. We’ve made a land purchase in Box Elder County where we hope to expand and grow more plants.”
“Logan City is conducting a feasibility study,” said Councilmember Mike Johnson. “The energy market is slowing down. We’re struggling to find energy and keep the cost low.”
Businesses are coming to Logan and some are more power hungry, he said. “Some are not coming in because we don’t have the energy.”
With IIJA tax credit we could save between $4 million to $8 million on solar installation, said Johnson. “Municipalties were not able to get it before but now they can. Otherwise, a city like Logan would not be eligible.”
The next step is for the city to complete a feasibility study and bring that before the city council to see if it is within the reach of the city’s financial situation, he said. “If it’s good, it will be bid out. We don’t have the exact details. The study will give us direction.”
The city’s big focus is on local reliability and control and jobs, said Johnson. “The tax credit will help local communities.”
“The excess power will go back on the grid,” said Cox. “That’s very important. It’s a beneficial program available to us and other companies to grow our economy. It benefits everything.”