Currently ranked 20th in the country for installed solar, the outlook for solar in the state is bright, with SEIA projecting that nearly 4 GW will be added in the next five years, popping the state up to the 12th spot.
New Mexico, called the Land of Enchantment, enjoys abundant sunshine in a land of wide open spaces. As the fifth largest of the fifty states in terms of size, it ranks just 46th by population density. With just under 15 GW of installed solar capacity, New Mexico ranks 20th in the U.S., which covers about 6.14% of electricity demand, according to the Solar Energy Industries Association (SEIA). The outlook for solar in the state is bright, with SEIA projecting that nearly 4 GW will be added in the next five years, popping the state up to the 12th spot.
Incentives
As in all states in the U.S., solar installations in New Mexico may receive the federal investment tax credit along with a state credit of $1,800.
The state also has a renewable portfolio standard (RPS) that requires that investor-owned utilities are securing 50% of their capacity through carbon-free renewables by 2030 and 100% by 2045. For rural electric cooperatives, it’s 40% by 2025, 50% by 2030 and 100% by 2050.
The Public Service Company of New Mexico, owned by investor-owned utility PNM Resources, offers a solar renewable energy certificate (SREC) program that will award systems under 10 kW $0.0025 for every kWh for the first eight years. Payouts are sent once the credit exceeds $20.
Net metering
With a maximum system capacity 80 MW, residents can receive credit on their next bill at avoided cost rate for excess kWh generated. If customer leaves the utility, unused credits are paid out oat the avoided cost rate.
Community solar
A state policy was passed in April 2022 by the Public Regulation Commission that allows for community solar up to 200 MW, split by utilities. The Public Service Company of New Mexico has 125 MW; Southwestern Public Service has 45 MW; El Paso Electric has 30 MW—all of which last through April 2024. There is also a stipulation that 30% of electricity produced by a community solar facility be earmarked for low-income subscribers. Native American energy authorities and rural electric cooperative projects in the state are not restricted by the cap.
InClime Solutions, a veteran-owned business that vets U.S. renewable energy and energy efficiency incentive programs, recently announced 200 MW of projects selected for inclusion in the next slate of New Mexico’s community solar program out of 1.7 GW of project submissions.
A recent University of New Mexico study found that community solar can provide a major economic stimulus to New Mexico at a time when it is desperately needed. The study found that community solar will:
- Generate $517 million in economic benefits
- Create 3,760 high-quality jobs in various sectors over the next 5 years
- Generate over $2.9 million in tax revenues annually for the state that is funded by private companies without requiring increased taxes or state investment
Landmark solar installations
In June 2022, the Public Service Company of New Mexico announced that it would move forward with four solar-plus-storage projects to replace the 847 MW coal-fired San Juan Generating Station.
The four projects slated to replace the fossil fuel generating station will all be located in Northwest New Mexico. The combined projects comprise 650 MW of solar generation and 300 MW/1.2 GWh of energy storage. Two of the projects have already been approved by state regulators: Arroyo Solar, owned by D. E. Shaw Renewable Investments, which clocks in at 300 MW and 150 MW/600 MWh of storage, and Jicarilla Solar I, developed by Hecate Energy, at 50MW and 20MW/80 MWh.
Commercial solar is also on the rise in New Mexico with Meta, Walmart, and Target all having solar installations in the state. Meta’s 50 MW project in Sandoval County is one of the largest. Public Service Co. of New Mexico and New Mexico Renewable Development LLC entered into an agreement in 2019 to build the solar array to provide electricity for a Meta (Facebook) data center.
The last stop on the pv magazine usa tour of 50 states of solar incentives was Arizona. Next we’ll head up to the northwest and take a tour of Washington incentives.
