New Mexico residential solar energy incentives

Solar market development tax credit

This incentive allows New Mexico to provide a 10% personal income tax credit of up to $9,000 for residents who purchase and install qualified photovoltaic and solar thermal systems.

Approved systems include off-grid and grid-tied residential PV systems and active solar hot water or hot air systems

Systems must be certified by the New Mexico Energy, Minerals, and Natural Resources Department.

Solar pool or hot tub heaters are not eligible for this tax credit.

Credits may be carried forward for a maximum of ten taxable years.

Personal renewable energy production tax credit

The New Mexico renewable energy production tax credit provides a tax credit against the personal income tax. Companies that generate electricity from solar energy receive a tax incentive that varies yearly with an annual average incentive of about 2.7¢/kWh.

Eligible solar technologies include solar thermal electric and photovoltaics.

The tax credit is applicable only to the first 200,000 megawatt-hours of electricity in each taxable year. Energy generators must have a capacity of at least 1 megawatt and be installed before January 2018 to qualify Systems must be in compliance with all applicable performance and safety standards.

El Paso Electric Company - small system renewable energy certificate purchase program

This program allows El Paso Electric to purchase renewable energy certificates from its customers who install photovoltaic systems up to 10 kilowatts in capacity. These renewable energy certificates are bought at a rate of $0.13 per kilowatt-hour for a 12 year period. REC purchase payments will appear as a credit on the customer's monthly bill. Any credit balance up to $30.00 will be applied to the following month's bill. Once the rolling credit exceeds $30.00 a direct payment will be made to the customer. Eligible systems must be connected to the utility's grid and net-metered and have a maximum system capacity of 10 kW AC.

Xcel Energy – solar rewards program

Through the solar rewards program Xcel Energy purchases renewable energy credits from its customers. For renewable energy credits, Xcel will pay $0.20 per kilowatt-hour for new photovoltaic systems between 0.5 kilowatt and 100 kilowatt AC. Depending on the size of the system, customers will receive payments for a various amount of years. Small systems will receive payments for the first 14 years and medium systems will receive payments for 10 years. Qualifying PV systems must carry a five year warranty that covers parts and labor from the manufacturer and installer. Participating PV systems will be net-metered and must have a separate production meter installed to ensure energy output. The output will be measured each month and will be paid in the form of a bill credit. A check will be issued to the customer if the total credit amount is $50 or over.

Residential renewable energy tax credit

This federal personal tax credit allows the taxpayer to claim a credit of 30% of expenditures including labor costs and installation of qualified residential solar-electric systems, solar water heating systems or fuel cells. Small wind-energy systems and geothermal heat pumps can also be accredited for. Solar-electric systems and solar water heaters have a maximum incentive of $2,000 if placed in service before 2009. There is no maximum incentive for systems placed after 2008. The excess amount of the federal tax credit may be carried forward to the next taxable year if it exceeds tax liability. This can be carried forward until 2016, but after that, it is unknown if the unused credit will be able to be forwarded.

Residential energy conservation subsidy exclusion

This is a personal exemption of 100% of energy conservation subsidies provided by public utilities. The value of a purchase or installation of any energy conservation measure by a customer such as solar water heat, solar space heat or photovoltaics will not be included in the customer’s gross income. Customers of an electric utility company, who participate in the utility’s energy conservation program, may receive a rate reduction of electricity furnished or a nonrefundable credit against the purchase price of the electricity on each monthly electric bill.

Energy-Efficient Mortgages

This is a federal loan program where homeowners can use EEM (energy-efficient mortgages) to finance renewable energy technologies in a home.