2023 Solar Incentives Guide for Santa Fe, NM - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Santa Fe.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated March 14, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Santa Fe?
Property Tax Exemption for Residential Solar Systems
Solar Energy Gross Receipts Tax Deduction
Geothermal Heat Pump Tax Credit (Personal)
Geothermal Heat Pump Tax Credit (Corporate)
PNM - Performance-Based Solar Program
Local Option - Renewable Energy Financing District/Solar Energy Improvement Special Assessments
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to make renewable energy usage more affordable through financial incentives for individuals who install solar panels on their homes. Incentives can include things like discounts, cash back or credit on your utility bill each month. Some incentives are provided by the federal government, while others are provided by the New Mexico government or by your specific utility company, county or municipality. Types of solar incentives might include:
- Net Metering: You can sign a net metering contract with your Santa Fe utility company that will apply to all or a percentage of the excess electricity your solar panels generate. They will then subtract this value from your utility bill each month.
- Rebates: Solar rebates may be provided by your state or county, or by your local utility company. These rebates are essentially partial refunds that are applied after you purchase solar panels and before tax credits are calculated.
- Tax Exemptions: These might come in the form of property tax exemptions, which can let you ignore the value added by your solar panels when paying property tax on your home. You could also look for exemptions on sales tax at the time of purchase.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)
Federal Solar Incentives
When you hear the term "solar incentives," federal incentives may be the first thing that comes to mind. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a specified percentage of the money you spend on your solar system.
The ITC applies to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Originally, the tax credit was for 30% of the total cost — for panels, accessories, labor and equipment — although it may range from 26-30%, depending on the installation date of your solar system. There is no cap on the amount you can claim.
Your local Santa Fe solar panel installation expert can give you more information about the ITC and how it applies to your situation.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit lasts until 2035. Solar installation projects started after January 1, 2022 and completed by the end of 2032 may qualify for a 30% tax credit; this amount will be decreased slightly on a yearly basis until the current program ends. Starting in 2023, it will also be easier to claim credits for energy storage systems under this new program.
Click here to learn more about the new Inflation Reduction Act. Your local Santa Fe solar panel installation expert is the best person to answer your questions about the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Some solar incentives are often also provided at the state and local level. Similar to federal incentives, these might include tax credits, rebates and more. The incentives — which may be given by your county or municipality, or by the state of New Mexico — might be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Santa Fe
There are many kinds of solar incentives: those provided by local utility companies, those provided by the federal government and those provided by the New Mexico government, to name a few. The use of solar energy has increased tremendously in the last 15 years, thanks to these incentives. We suggest talking to your local Santa Fe solar installation expert for more information about these incentives and to make sure that you're getting the largest number possible for your solar system.
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Best Warranty Coverage
- Industry-leading warranty coverage
- Expansive service area
- Some reported communication issues
- No leases or PPAs
EcoWatch's Santa Fe, NM Solar Incentives FAQs
How much will a solar system save me annually on my electric bill in Santa Fe?
After adding solar panels to your home in Santa Fe, you can anticipate savings of around $1,399.72 per year, or around $26,594.60 over 20 years.
Who installs solar panels near me?
To find a top-rated solar panel installer, check out our guide to the best solar companies in Santa Fe.
What are some of the environmental benefits of switching to solar?
You can reduce your carbon footprint by 500 pounds of CO2 a year by switching to solar panels. This adds up to roughly 10,000 pounds in 20 years. Solar is also a renewable energy source, meaning that making the switch reduces the drain on our planet's resources.
When does the federal solar tax credit end?
The federal solar tax credit, formerly called the ITC and now titled the Clean Energy Credit, is set to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I use multiple types of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Be sure to talk through your ideas with your local Santa Fe solar installation expert. They can help you plan your project and educate you on the various incentives that you may or may not qualify for.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.