Due to the high volume of applications for the state’s solar market development (SMD) tax credit for photovoltaic systems, the New Mexico Energy Conservation and Management Division expects that the $3 million allotment for the credit this year will run out early – by the end of July.
“The program was set up nine years ago with an allocation of tax credits limited to $3 million per tax year for photovoltaic systems, and the limit has been reached in each of the last four years,” explains Division Director Louise Martinez. “With the number of SMD tax credits already given this tax year, we’re projecting that in July 2016, we’ll receive the final PV application.”
According to the department, the SMD tax credit program was established in 2006 and will pay up to 10% (up to $9,000) of a solar PV system. 2016 is the current program’s last year.
The department says the program, which also offers credits for solar thermal systems, has resulted in over 40 MW of residential, small business and agriculture solar projects installed statewide. Of this, there were 1,096 household-scale systems installed that added 6 MW of solar generation capacity to the grid.
Martinez says the tax credits have “stimulated” the state’s solar industry.
“The program has spurred significant growth in the distributed solar market and added strength to New Mexico’s electric system as more New Mexicans add solar power systems to their property each year,” Martinez concludes.