The year 2019 was a big year for green advocates in New Mexico. Based on their monitoring, the legislature submitted 100 bills that are related to the environment.
Among the proposals was Senate Bill 518, authored by Senator Mimi Stewart (D), which would have added another incentive for homeowners and businesses to install solar panels on their buildings.
The purpose, of course, is to encourage homeowners and property owners to invest in photovoltaic systems and solar thermal technology to cut dependence on fossil fuels.
SB 518 offers 10% in new mexico solar tax credits on the individual’s personal income. The 10% is computed from the total amount you invested in solar photovoltaic technology or solar thermal systems, whether on houses, farms, and commercial properties.
The tax credit incentive is retroactive after Jan. 1, 2019. Each homeowner or property owner, however, is only entitled to a maximum of $6,000 in total tax credits.
Resuming the 2016 Incentive
The New Mexico solar tax credits expired in 2016. But there have been several attempts to revive the measure since then. However, former Governor Susana Martinez has never been a fan of the bill. Every time the bill landed on her desk, she always pocket vetoed it.
Advocates, meanwhile, are optimistic now with the new Governor Michelle Lujan Grisham, whom they believe is sympathetic to their cause. Now, SB 518 only needs to pass the House before it can be submitted to the governor for approval.
The 10% New Mexico solar tax credits would have helped once the federal investment tax credit finally expires in 2022.
By then, homeowners could no longer claim tax credits on the investment they put in for their solar panels. However, businesses will continue to enjoy a 10% tax credit for commercial solar projects.
If SB 518 is not vetoed by Gov. Michelle Lujan Grisham, 2019 would be the perfect year to invest in solar panels for your home, business or farm. Apart from the 30% federal tax investment credit, you will also get a 10% New Mexico tax credits.
Even if SB 518 didn’t pass now, there’s no need to drop your plan of installing solar panels on your home. For instance, this year’s federal solar tax claim is still 30%. Even if you can’t do it this year, you can still avail of the 26% tax claim from the federal government in 2020.
Besides, New Mexico offers other incentives for renewable energy projects. For instance, solar roofs are excluded from the computation of your property taxes. Power utility companies also employ other incentives and rebates, such as the net metering system and the RE certificate purchase program.
With the New Mexico buy-back program, you can sell excess energy generated by your solar panels at $0.02 for each kilowatt-hour to El Paso Electric. The net metering program also allows you to earn extra credit if you connect your system to the grid. Meanwhile, buildings that are certified for sustainability can earn as much as $6.50 per square foot from their solar investments.