A new report details the contributions made by the energy and mining sector to Utah’s economy, despite pressure from the Biden administration’s platform to shift to a clean energy economy that eschews fossil fuels and some mining projects.
The energy and mining industries contributed over 10% to the state’s gross domestic product, supported over 6% of total jobs, and contributed a significant 20% to Utah state tax revenue in 2019, according to a new study commissioned by the Utah Geological Survey and completed by Utah State University’s Department of Applied Economics.
“The energy and mining industries are important contributors to Utah’s economy. In particular, the upstream segments of these industries are deeply rooted in rural areas of the state. In addition, the mining industry will only become more important as energy sources evolve and society becomes more reliant on electricity and power storage, which depend on lithium, copper, tellurium, indium and more,” said Michael Vanden Berg, Utah Geological Survey energy and minerals program manager.
Mining infused $7.7 billion into the state’s gross domestic product, contributing 4% to Utah’s overall economy and supporting 56,700 jobs.
But there is political opposition to some mining projects that often hinges on their location or the feared destruction of landscapes previously untouched.
It sets up a conundrum for the Biden administration, which is seeking to bolster domestic supplies needed for clean energy technology while weaning itself from foreign exports like those from China.
A pair of Utah companies perched on the shores of the Great Salt Lake are exploring the mining of lithium — used in electric vehicle batteries, among other things — but there has been intense opposition to a project in Nevada where opponents fear the water use is unsustainable.
There have also been copper mining projects that President Joe Biden has stopped, even though copper is on the federal list of critical minerals needed to shore up domestic national security. One such project in Minnesota is stalled under litigation, and Biden yanked leases reinstated under the Trump administration for another project, according to Courthouse News Service.
Despite some shuttered coal mines in Utah, the mining industry overall contributed 5.6% to Utah’s overall economy.
Amid political pressure and the tension that swirls around gas and oil development in the United States, Utah delivered an infusion of cash to state coffers in 2019 via extraction — $12.1 billion comprising 6.3% of the entire economy.
Moreover, it supported 74,200 jobs and paid $1.5 billion in state tax revenue, or 14.4% of the state’s total economy.
“We appreciate working with the state of Utah on this economic contribution report,” said Tanner McCarty, report co-author and assistant professor of the Department of Applied Economics at Utah State University. “Understanding the value of these vital industries is important for proper management and support.”
Funding for this economic study was secured by the Natural Resources, Agriculture, and Environmental Quality Appropriations Subcommittee during the 2021 Utah Legislative Session.