More tax credits for solar power projects were issued by the State of New Mexico last year than the last two years, records show, as the industry grows amid support from policymakers and increasing popularity.
In 2022, records from the Energy, Minerals and Natural Resources Department (EMNRD) showed about $10.9 million in tax credits were certified for solar power projects built that year, about 91 percent of the state’s cap of $12 million in credits.
Last year’s credits were almost double 2020’s at $6.7 million, records show, and more than $2 million more than the $8 million in solar tax credits provided by the state in 2021.
So far this year, EMNRD reported $198,685 was provided in solar tax credits.
The state was led by Bernalillo County, its most populous, with 3,430 projects approved through the program at 671 projects per 100,000 residents, records show, followed by Doña Ana at 1,124 projects per capita.
Santa Fe County was third in the state with 1,093 projects approved by EMNRD, records show, or 706 per capita.
In rural southeast New Mexico, Otero County had just 455 solar power projects in the program, data showed, but was a state leader in per capita projects 671 and fourth in supported jobs at 231.
The state reported Doña Ana County was also second in New Mexico for jobs supported through solar projects at 522, following only Bernalillo County 1,366 jobs.
Statewide, EMNRD reported the overall 3,436 projects approved last year supported 3,670 jobs in the state.
The program was started upon the passage of Senate Bill 29 during the 2020 Legislative Session, known as the Solar Market Development Tax Credit.
It was sponsored by Sen. Mimi Steward (D-17) and Rep. Matthew McQueen (D-50) and signed into law by Gov. Michelle Lujan Grisham on March 3, 2020.
Since then, Director of EMNRD’s Energy Conservation Management Division Louise Martinez said the program was a boost to the growing sector.
Anyone who installed a solar system in 2022 can still apply for the remaining $2 million in available tax incentives for last year, Martinez said.
“The Solar Market Development Tax Credit has proved extremely popular,” she said. “We are roughly $2 million shy of reaching our cap for the most recent tax year. So, we encourage anyone who installed a solar system in 2022, but has not yet applied for the tax credit, to submit their applications immediately.”
The $8 million cap for 2021 was reached, but the legislature allocated $12 million more in 2022 and for 2023 to support the program. Applications for the credit are given on a first-come-first-serve basis.
The program offers a 10 percent tax credit on the cost of installation of a solar thermal or photovoltaic system, up to a maximum of $6,000 per project.
Martinez said it helped save New Mexico power customers on bills, and also moved the state closer to reaching its goals for reducing carbon emissions from energy development.
In 2019, Lujan Grisham signed the Energy Transition Act into law, establishing a goal of completely carbon-free energy in New Mexico by 2045.
“This program not only saves consumers money—both through the tax credit and electricity costs—it also reduces New Mexico’s carbon footprint, moving us closer to our climate goals,” Martinez said.
Upon the bill’s passage in the New Mexico House, the last stop before being signed into law, Lujan Grisham said it was needed policy to address pollution from the energy sector and reduce the state’s impact on climate change.
“By reinstating the solar tax credit, we’re making sure New Mexicans have an easier path to installing solar on their homes and businesses,” Lujan Grisham said in a statement.
And although EMNRD data shows less tax credits paid out in the oil-rich Permian Basin region to the southeast, fossil fuel companies could soon become one of the biggest users of renewable energy like solar power in the state and U.S.
A recent report from economic research firm GlobalData showed oil and gas companies held about 1 percent of total global installed renewable energy in 2022, and that renewable energy generation as a whole was expected to grow by about 6.9 percent annually between 2022 and 2030.
That meant the share of fossil fuels in the global energy mix was expected to the decline, the report read, leading oil and gas companies to increase investments in renewable energy in the coming years, primarily through solar and wind ene
