Electric Power Systems

Project Name 
Project Morgan
Date Announced 
2Q 2017
Site 
Logan, Utah
Competition 
Arizona
“We are excited to tap into the state’s industrious, innovative workforce, and build a world class Energy Storage System product line that makes the world safer, cleaner, and more mobile." -- Nathan Millecam, CEO Electric Power Systems
Decision Drivers 
Operation Costs, Regulations on Manufacturing, Workforce
Jobs 

128

Investment 

$11.6 million

Square Footage 

15,000 SF

Incentives 

EP Systems may earn up to 20 percent of the new state taxes they will pay over the seven-year life of the agreement in the form of a post-performance Economic Development Tax Increment Finance (EDTIF) tax credit rebate. As part of the contract with EP Systems, the GOED Board of Directors has approved a post-performance tax credit rebate not to exceed $1,674,781. Each year as EP Systems meets the criteria in its contract with the state, it will earn a portion of the total tax credit rebate.EP Systems may earn up to 20 percent of the new state taxes they will pay over the seven-year life of the agreement in the form of a post-performance Economic Development Tax Increment Finance (EDTIF) tax credit rebate. As part of the contract with EP Systems, the GOED Board of Directors has approved a post-performance tax credit rebate not to exceed $1,674,781. Each year as EP Systems meets the criteria in its contract with the state, it will earn a portion of the total tax credit rebate.

Case Study Story 

Utah’s higher education system plays a significant role in EDCUtah’s efforts to recruit companies to the state. That significance is exemplified in Electronic Power (EP) Systems’ decision to move to Logan, Utah.

EP Systems traces its roots to Los Angeles-based Phillips Machine & Weld. Beginning as a manufacturer and supplier of machined parts to aerospace companies such as Boeing and Northrop Grumman, the company ventured into energy storage systems for electronic vehicles. EP Systems’ product integrates key technologies such as lithium-ion batteries, converters, controllers, software, and mechanical packaging for major industrial and aerospace markets. Its technology aims to address issues such as energy independence, carbon emissions, and global security.

It is this technology, and the research being done in the field, which brought EP Systems to Utah. The company was looking to move their headquarters, including a new facility to handle R&D as well as advanced manufacturing, from their current location in Los Angeles. Though courted by Arizona with a large incentive, “team Utah” came together to show EP Systems that Utah was the best place for them to innovate and grow. 

One of the key decision drivers for EP Systems was that Utah State University (USU) conducts similar research to what the company does. That will provide a great partnership between the university and the company not only in the collaboration of research being done, but also the workforce being developed at USU that will feed directly into the company. Having recent graduates that are well versed in the complex technologies EP Systems designs and manufactures will significantly reduce the costs of training new employees. 

Another key decision driver was operating cost. Through two site visits, site research, cost comparisons, and occupation reports, Max Backlund, who managed this project for EDCUtah, showed the company the significant cost savings that can be achieved in Utah and particularly in Logan. The Utah Science Technology and Research Initiative (USTAR) also played a crucial role. They provided a grant for the renovation of lab space at USU that both the company and university will use, reducing costs for all parties involved. Additionally, the potential that Utah's Foreign Trade Zone will expand to Logan will add more cost savings for the company.

The Governor’s Office of Economic Development (GOED) led the efforts of “team Utah,” specifically in providing an incentive. Logan City was with EDCUtah every step of the way, supporting the company as they considered where in Logan to locate. EP Systems will be a great addition to Logan’s growing aerospace and defense industry, as well as Governor Herbert’s goal to create 25,000 jobs in rural Utah over the next four years.

On May 11th, 2017 EP Systems accepted an incentive to create 128 jobs and $11.6 million in capital investment. The company has selected a two acre site in Logan and plans to build a 15 thousand square foot facility.