Homeowners who missed out on a tax credit for going solar will have another shot at recouping some of their investment, thanks to a new state program.
The Supplemental New Solar Market Development Tax Credit program from the Energy, Minerals and Natural Resources Department (EMNRD) is aimed at New Mexico taxpayers who were denied solar tax credits between 2020 and 2023 because funding had been exhausted before they applied.
“On behalf of the New Mexico taxpayers who missed out on this tax credit, through no fault of their own, we thank the Legislature and Gov. Michelle Lujan Grisham for creating this supplemental fund,” said Rebecca “Puck” Stair, director of EMNRD’s Energy Conservation and Management Division, which administers the tax credit program. “We stand ready to process those applications and support the deployment of more solar energy in the Land of Enchantment.”
First enacted in 2020, the New Solar Market Development Tax Credit program offers up to 10% on solar system installation costs for qualified solar thermal and photovoltaic systems, up to a maximum of $6,000 per taxpayer per year.
Every year, the department has had to reject hundreds of solar tax credit applications after the annual funding caps mandated by the Legislature were reached.
During the 2024 legislative session, lawmakers appropriated $20 million in credits for taxpayers who missed out on the money over the previous three years. The Legislature also boosted the program’s annual cap from $12 million to $30 million.
The EMNRD is also processing applications from taxpayers who installed solar systems in 2024. Taxpayers can submit applications for both the supplemental and the 2024 tax credits here.
Since the program’s inception, according to the department, more than 13,000 New Mexicans have received solar tax credits averaging $3,078. The EMNRD estimates New Mexicans have saved an average of $1,624 per year in energy costs while adding more than 100 megawatts of distributed solar generation to the state’s power grid.
More money out there
Jim DesJardins, executive director of the Renewable Energy Industries Association of New Mexico, told City Desk ABQ Tuesday the higher cap means taxpayers can be more confident they’ll get some money.
He said property owners should make their buildings as energy efficient as possible before going solar, to reduce the size of the systems they will need.
DesJardins said other state and federal tax credits are available, along with incentives offered by Public Service Company of New Mexico for items such as heat pumps and electric vehicle charging stations, could mean substantial savings for some taxpayers.
“If you stack them, it can be a really good deal,” he said.
DesJardins said property owners seeking the credit for 2024 should start contacting contractors now, to ensure the work is done by the end of the year.