For more than three decades, I’ve worked at the intersection of business, policy and politics in Utah — helping clients navigate legislative changes that often reshape entire industries. Few areas illustrate the volatility of policymaking more clearly than renewable energy. In the last two years, Utah lawmakers — along with federal policymakers — have sent powerful signals that the era of expansive solar and wind incentives are drawing to a close. For developers, communities, and investors, these changes present not only challenges but also an urgent need to rethink strategy in a shifting energy landscape.
The Phase-Out of Renewable Energy Incentives
Utah's 2025 legislative session introduced several bills that changed the state's incentives for renewable energy in significant ways:
· Phase-Out of Tax Incentives: Sponsored by Representative Kay Christofferson (R-Lehi), HB 264 amended existing tax incentives for large-scale clean energy systems, ending the individual and corporate income tax credits for solar, geothermal, biomass, and wind energy projects that begin operating after 2028. These tax incentives have been in place for over 15 years, and did not previously have an end date, so this represents a big shift in the state’s stance toward renewable energy.
· Tying Incentives to Battery Storage Requirements: SB 192 sponsored by Sen. Derrin Owens (R-Fountain Green), requires commercial wind and solar systems producing more than 600 kilowatt-hours of energy to be accompanied by battery storage or another storage means to qualify for state tax credits unless the project is in an interconnection queue (waiting list for transmission) or has a signed agreement with a transmission provider before January 1, 2025.
Taxing the Sun and Wind
HB 378 was sponsored by Representative Casey Snider (R-Paradise). It introduces a new tax on wind and solar energy generation facilities that begin operation in the state after January 1, 2026, unless they were under construction or had a power purchase agreement in place before that date. The tax is calculated at $1,050 per megawatt of capacity per year. The revenue generated will fund the Species Protection Account, supporting conservation efforts for endangered and at-risk species in Utah. In addition, there is a tax for 2026 and 2027 on parent entities that own solar and wind generation in the state.
The bill elicited strong reactions from the renewable energy sector. Developers argued that the tax could significantly impact the financial viability of planned projects, particularly those with thin profit margins.
Proponents of the bill, including Rep. Snider, contend that renewable energy facilities should contribute to environmental mitigation efforts, as do industries like oil and gas. They successfully argued that the tax is necessary to ensure that all sectors bear responsibility for the state's conservation needs.
Shining a Light on Renewable Contracts
In 2024, the Utah Legislature enacted House Bill 215, known as the "Home Solar Energy Amendments," aimed at enhancing consumer protection in the residential solar market. Sponsored by Rep. Colin Jack (R-St. George), the bill introduced several key provisions:
· Cooling-Off Period: Customers now have a seven-day window after signing a solar agreement to cancel without penalty.
· Installation Delay: Installation cannot commence until at least seven days post-signing, allowing consumers time to reconsider.
· Refund Guarantee: Should a customer choose to opt out, a refund is mandated within 10 days.
· Enforcement Measures: Violations can result in fines up to $2,500 and potential legal action.
These measures were introduced to respond to rising numbers of consumer complaints about aggressive sales tactics and misleading practices in the solar industry.
Federal Dynamics Exacerbate the Impact of Utah Changes on Solar and Wind Developers
At the federal level, legislative actions will impact the solar and wind industry as well. A recent tax bill signed into law by President Trump on July 4, the One Big Beautiful Bill Act, significantly rolls back clean energy tax credits established under the Biden administration's Inflation Reduction Act. Wind and solar production and investment tax credits previously good through the early 2030s now expire if projects do not begin construction by July 4, 2026, or are not placed in service by Dec. 31, 2027. Further, an executive order dated July 7 significantly tightened down what qualified as “under construction”, meaning projects must do more than purchase equipment or stage to qualify by July 4, 2026. The federal tax incentive was always more significant than the state tax incentive, so these changes will compound several times over the impact of changes made to Utah tax credits. Incidentally, the bill also accelerates the phase-out of tax credits for rooftop solar installations and electric vehicles, affecting the financial incentives that have driven solar adoption in other arenas.
What’s ahead
A study committee of the legislature just approved legislation for consideration by the full legislature in 2026 that would remove state financial incentives for large-scale solar projects situated on "productive farmlands," and productive grazing lands, as defined by the Utah Department of Agriculture and Food. While the bill does not outright ban such projects, it eliminates access to certain tax credits. Additionally, the bill mandates consultations with state biologists regarding potential impacts on wildlife and requires developers to establish plans and funding for what happens when the project is shut down. This legislation reflects a concern over the balance between renewable energy development and agricultural preservation as well as worries about what happens when projects reach the end of their useful life. This bill is virtually identical to HB 241 by Rep Colin Jack (R-St. George), that was considered but failed to pass during the 2025 General Session.
Conclusion
The Utah Legislature's evolving stance on renewable energy policy in 2025 reflects a deliberate recalibration—aimed at balancing environmental ambitions with fiscal prudence and species stewardship. The elimination of the tax incentive in 2028 signals a shift away from long-term subsidies toward market-based accountability. Meanwhile, legislation adopted in 2024 enhanced consumer protections, ensuring that residential solar adoption remains a secure and transparent process.
The volatility in renewable energy policy demonstrates just how quickly incentives can vanish and new obligations can emerge. For developers, investors, and communities, that reality makes proactive government relations essential. At Parsons Behle & Latimer, I work with clients to stay ahead of the curve — not just adapting to policy changes, but actively shaping them to create fair, workable solutions. If you’re looking to safeguard your projects and capitalize on emerging opportunities, I’d be glad to discuss how we can chart a strategy that withstands political headwinds and regulatory uncertainty.
Shelly Cordon Teuscher has been the director of government relations for Parsons Behle & Latimer since 1994. Her career in politics began in 1983 with a position at the Office of Legislative Research and General Counsel, the main staff office of the Utah Legislature. She has worked as a lobbyist since 1989. To reach Shelly, send an email to steuscher@parsonsbehle.com.
