Incentives for Clean and Renewable Energy

Alternative Energy Product Manufacturers' Tax Credit
Renewable Energy Production Tax Credit
Wind Energy Equipment Gross Receipts Tax Deduction
Biomass-Related Equipment Tax Deduction
Energy Efficiency and Renewable Energy Bonding Act
The Efficient Use of Energy Act
Clean Energy Grants Program
Solar Thermal Electric Tax Credit
Solar Market Development Tax Credit
Sustainable Building Tax Credit
Hybrid Tax Exemption
PNM Customer Solar PV Program
Solar Energy Gross Receipts Tax Deduction

For more information or a free custom analysis of tax incentives for your company, call 800-226-2935 or email us.

Alternative Energy Product Manufacturers’ Tax Credit

This tax credit was created by the State of New Mexico to encourage the manufacturing of “advanced energy products.”

• The Credit:
• Provides for a credit equal to 5% of the value of purchases of qualified manufacturing equipment.
• Equipment must be used directly and exclusively in a manufacturing operation that makes components or systems for alternative energy products.
• Can be applied against compensating, gross receipts tax or withholding tax due.
• Any remaining credit may be carried forward for up to five years.
• Credit can be taken in addition to Manufacturing Investment Tax Credit.
• There is no sunset.
  
• Job Criteria:
• 1 new job per $500,000 of equipment purchased for first $30 million of equipment purchased.
• 1 new job per $1 million of equipment purchased in excess of $30 million.

Any remaining credit may be carried forward for up to five years.

Credit can be taken in addition to Manufacturing Investment Tax Credit.

• Alternative Energy Product Definition:
  Alternative energy products include the following products or components for them:
• Motor vehicles powered by electricity, including hybrids,
• Fuel cell systems,
• Photovoltaic, solar thermal, wind, biomass and electric generation systems,
• Some coal gasification combined cycle facilities,
• Equipment to sequester carbon from combined cycle plants.

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Renewable Energy Production Tax Credit

New Mexico provides a renewable energy production tax credit (frequently called a “PTC”) for qualifying producers of electricity from solar, wind and biomass energy.

• Qualifying Facilities
• One megawatt generating capacity
• Sells electricity to “unrelated person”
• Producing electricity on or before Jan. 1, 2018
• The Credit
• Corporate income tax
• Five year carry-forward
• WIND AND BIOMASS for first 400,000 megawatt hours for a taxable year:
• One cent per kwh
• SOLAR for the first 200,000 megawatt hours for a taxable year:
• Increasing in .5 cent increments from 1.5 to 4 cents for the first six years
• Decreasing in .5 cent increments from 3.5 cents to 2 cents in the last four years
• Can be claimed for ten years from date of first generation
• Can be claimed for an industrial revenue bond project.
• Allocable to Owners of Pass-Through Entities
• May be allocated more liberally than federal PTC
• Credit claimants must collectively own at least 5% of facility.
  

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Wind Energy Equipment Gross Receipts Tax Deduction

New Mexico provides a gross receipts tax deduction for receipts from selling wind turbines, nacelles, rotors, blades and “related equipment” to a state or federal government entity. The deduction is primarily intended to aid those constructing wind farms financed by an industrial revenue bond [link] when the actual purchaser is a New Mexico county or government. By Taxation and Revenue Department Ruling, the deduction does not apply to towers supporting wind turbines.

Biomass-Related Equipment Compensating Tax Deduction

The value of biomass-related equipment such as: boiler, gasifier, furnace, turbine-generator, storage facility, feedstock processing or drying equipment, feedstock trailer or interconnection transformer and biomass materials used for processing into biopower, biofuels or bio-based products may be deducted in computing the compensating tax due.

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Energy Efficiency and Renewable Energy Bonding Act

Enables the state to issue bonds for $20 million in energy efficiency upgrades in state buildings and schools, pay back the bonds with energy savings, and use the net profits for renewable energy projects.

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The Efficient Use of Energy Act

Requires public utilities to evaluate the potential for energy efficiency improvements and implement programs to increase energy efficiency.

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Clean Energy Grants Program

Appropriates $3 million for grants for clean energy projects and hydrogen energy technology for municipalities and other eligible community, tribal, and state entities.

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Solar Thermal Electric Tax Credit

Corporate tax credit. Along with the federal government, the state will credit up to 30% of solar photovoltaic or solar thermal system, up to $9,000.

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Solar Market Development Tax Credit

Personal tax credit. Along with the federal governmnet, state will credit up to 30% of solar photovoltaic or solar thermal system, up to $9,000.

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Sustainable Building Tax Credit

LEED-certified personal residences and businesses receive tax credits based on square footage of building and level of sustainability of building.

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Hybrid Tax Exemption

Buy a hybrid-gasoline-electric vehicle that gets 17.5 mpg or more and save between $600 and $1,000.

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PNM Customer Solar PV Program

Production incentive for installation of photovoltaics for commercial and residential customers.

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Solar Energy Gross Receipts Tax Deduction

100% gross receipts tax exemption from sale and installation of solar energy systems.

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