New Mexico Solar Panel Buyers Guide [Installation & Efficiency 2022]
Here’s what we’ll cover in this guide to New Mexico solar panels:
- How to get solar installed on your home in NM
- How much electricity your solar energy system will generate and how many panels you need
- Solar benefit programs afforded by the state and federal governments
How to Get Solar Panels in New Mexico
When you’re ready to begin the process of installing photovoltaic (PV) equipment, you’ll first need to choose a solar provider and contact the company for a free quote. A sales representative will probably need to come out to your property to inspect the roof and surroundings as well as review your recent energy bills to estimate electricity usage.
Next, you’ll choose a financing option — cash purchase, loan, lease or power purchase agreement (PPA) — and approve the system design. Your installer will then pull permits and begin the installation process once they’re approved. Then you’ll have one final inspection from your local jurisdiction to close out the permits.
Investing in solar is usually a wise choice in NM — installing solar PV panels typically saves residents over $15,000 on energy costs over the life of the system. Plus, those savings come after your panels pay for themselves, making solar an excellent financial decision for most New Mexicans.
NM Solar Group
What Is the Price of Solar Panel Installation in New Mexico?
The average cost for solar equipment in NM is $2.68 per watt. If you assume you’ll need the typical system size of 7 kilowatts (kW), you’re looking at a total system cost of $18,760. If you can take the entire federal solar investment tax credit (ITC), then your total will effectively be $13,132.
One of the best parts about installing solar in NM is that the panels typically pay for themselves in energy savings in around 12 years. This estimate, referred to as the panel payback period, is in line with the national average.
If you need specifics on pricing out your system, you can check out our guide to solar power system prices in New Mexico.
The Best Solar Panel Brands Available in New Mexico
With the abundant sunlight available in NM, it’s not surprising that the local solar industry is outperforming those of other states. Thankfully, most of the larger solar panel manufacturers recognize the demand in NM and make their products available to customers in the Land of Enchantment.
Residents usually don’t need to splash out on the highest-efficiency panels or those with the most comprehensive warranty coverage, given the temperate weather in NM. However, with summer temperatures commonly hitting over 100 degrees, panel brands that perform well in extreme heat are often best.
Below are some of the more prevalent panel brands in NM that are suited for the high temperatures:
- SunPower (Maxeon)
- Canadian Solar
- Trina Solar
- Mission Solar
Is New Mexico a Good State for Solar Panels?
NM is a great place to go solar and currently ranks 19th in the country for solar adoption.1 Below are some of the factors that make solar such a worthwhile investment in the area.
- Tons of sunlight: One of the most obvious benefits of going solar in NM is the abundance of sunshine. The state gets an average of 300 sunny days annually, which is around 150% of the national average of 205.2 Since your panels rely on sunlight to produce energy, NM is a prime place for residents to generate plenty of power to easily offset energy bills.
- Below-average energy needs: Despite the excessive heat throughout the summer, NM residents’ energy consumption sits well below the U.S. average. The typical household consumes just 670 kilowatt-hours (kWh) per month as compared to the U.S. average of 893 kWh.3 Areas with below-average energy needs require smaller, less-costly solar panel systems to accommodate their consumption.
- Great statewide solar benefits: NM has a variety of solar incentives available to residents that help reduce the up-front costs of systems and bump up savings over time. We’ll get into the specifics of the benefits and perks in a later section.
- Frequent power outages: Finally, combining the typical panels and inverters with solar batteries allows solar customers to take their homes off-grid. Adding on a solar storage solution will drive up your costs, but it’s a popular option in NM where power outages are common due to excessive pressure on the electric grid.4
How Much Energy Can I Get From Solar Panels in New Mexico?
Knowing the amount of energy your panels can produce is helpful in estimating how many you need for your home. Unfortunately, coming up with this estimate is a bit complicated, and you need to take a bunch of factors into account to arrive at an accurate figure. Some of the more influential of these include:
- Which direction your house faces: The intensity of the sun hitting your panels matters a great deal, with higher intensity leading to greater rates of production. In the U.S., panels that are angled toward the south — on south-facing roofs — will generate the most energy for this reason, according to the U.S. Department of Energy.5
- Shading on your roof: The amount of sun your roof gets throughout the day is another important thing to consider. Longer sun exposure times will always lead to greater production. If your roof receives shade from tree coverage, utility poles or other buildings, your production capacity will drop for as long as shadows are cast on your rooftop panels.
- Weather: Similarly, clouds that obstruct the sun will scatter photons that would otherwise be absorbed by your panels and converted into electricity. Heavy cloud coverage can cause production to dip by up to 90%. Luckily, the sunny weather in NM means this isn’t an issue very often.
- The size of your solar array: Each additional panel you install will drive up your maximum rate of production because bigger systems always produce more if other factors remain equal. Just remember that an accurate system size based on your energy needs is far more cost-effective than the biggest system your roof can handle.
- The specific panels you have installed: Finally, each panel brand and product line comes with a different efficiency rating. This percentage determines how much of the sunlight that hits the panel can be used for energy production. More efficient panels will always produce more power when all other factors are equal.
Taking all of these factors into consideration makes getting an estimate for your solar production a bit complex. However, you can use the numbers in the chart below to see average production rates for common system sizes in NM.
|Solar Power System Size||Expected Daily Energy Produced||Expected Monthly Energy Produced||Expected Annual Energy Produced|
|4 kW||13.3 kWh||400 kWh||4,800 kWh|
|5 kW||16.6 kWh||500 kWh||6,000 kWh|
|6 kW||20 kWh||600 kWh||7,200 kWh|
|7 kW||23.3 kWh||700 kWh||8,400 kWh|
|8 kW||26.6 kWh||800 kWh||9,600 kWh|
|9 kW||30 kWh||900 kWh||10,800 kWh|
|10 kW||33.3 kWh||1,000 kWh||12,000 kWh|
If you need a more accurate estimate for production, you can use our solar calculator. This handy tool takes your location and shading on your property into consideration to provide an accurate estimate of how much electricity panels on your roof will generate.
Solar Panel Policy History in New Mexico
Part of the reason solar is such a great investment in NM is the state’s rich history when it comes to pro-solar policy.
The first piece of legislation that benefited solar customers in NM was the passing of solar easements. This took place in 1977 and gave residents the right to harness the sunlight hitting their properties.
A few years later, in 1983, NM put solar rights into place throughout the state. These guaranteed residents the ability to install solar panels and prohibited homeowners associations (HOAs) and other governing bodies from preventing solar adoption.
More than two decades later, NM set its first Renewable Portfolio Standard (RPS) goal. The goal was revised in 2007 and again in 2014 to mandate that at least 20% of the state’s electricity generated by investor-owned utilities (IOUs) come from renewable energy sources. Importantly, the RPS revisions included a 20% carve-out for solar, in particular, or 4% of all electricity sales.
New Mexico’s most recent RPS calls for 100% of the state’s electricity to come from renewables by 2045.
In 2007, NM began offering the Sustainable Building Tax Credit (SBTC). Although this measure didn’t directly affect solar customers, it benefits them indirectly by incentivizing builders to implement green building practices in all new construction in the state.
In 2008, NM implemented the solar energy gross receipts tax deduction. This measure also doesn’t directly benefit New Mexico homeowners, but it exempts solar equipment from sales tax and use taxes for installers, and the savings are often passed on to solar customers.
The NM Public Regulation Commission (PRC) started its net metering program in 2008 as well. This policy helps residents offset future energy bills by giving them credit for excess energy their panels generate that can go toward electric bills or be paid out in cash.
There are no specific mandates for the rate that is paid for your excess power, so the benefit will vary among utility companies. Xcel Energy currently offers the most appealing program, which offers a retail rate for credits.
Many other companies use a less beneficial avoided-cost rate, so you’ll have to check with your provider if you’re a customer of Public Service Company of New Mexico (PNM), El Paso Electric, Central New Mexico Electric or other company.
In 2009, NM passed legislation that made Property Assessed Clean Energy (PACE) financing an option for solar customers. PACE financing helps provide solar loans with low interest rates and affordable down payments to keep solar as accessible as possible.
In 2010, NM began offering a solar property tax exemption. This perk prevents your property taxes from increasing when your home value increases due to adding a solar system.
Renewable Energy Certificates (RECs) — also called Renewable Energy Credits — became available for solar production in 2014. The program promised to pay out $0.02 per kWh generated with residential solar systems 10 kW and under. This benefit lasts for eight years after installation.
Finally, in 2020, the Solar Market Development Tax Credit (SMTDC) was initiated. This is the New Mexico solar tax credit that provides a credit of up to 10% of your home solar system total to your state income tax burden.
What Are the Solar Panel Incentives in New Mexico?
Thanks to all of these pro-solar legislative measures, New Mexico residents have access to some appealing benefit programs. We’ll discuss these briefly below and how they affect residents who opt to reduce their carbon footprints.
- Federal solar tax credit: This is a credit to your federal income taxes in the amount of 30% of your entire system cost, including panels, inverters and batteries. In NM, this credit averages around $5,628.
- Solar Market Development Tax Credit: This is the state income tax credit that provides an additional break on your tax liability — up to 10% of your solar panel cost.
- Net metering: Net metering lets you generate more energy than you need to put toward future utility bills. Many companies in NM offer an avoided-cost rate, while some — like Xcel Energy — provide more beneficial retail rates for credits.
- Gross receipts tax exemption: This exemption relieves installers and manufacturers from having to pay sales tax and use tax on PV equipment. Overall, this brings down the cost of the equipment.
- Property tax exemption: Finally, this exemption prevents your property taxes from going up due to solar installation. Normally, solar would bump up your taxes, as it increases your home value.6
For more information on these perks and others that might be available, you can check out our guide to all New Mexico solar incentives.
Find a Local Installer in New Mexico
The company you choose to handle your solar project will play an important role in your overall experience, how much you pay for your system and the warranties provided. Since there are around 40 local installers to choose from in NM — according to the Solar Energy Industries Association (SEIA) — deciding can be difficult.7
To help get you started in the right direction, we’ll include some links below to reviews of the top solar installers in major cities throughout the Land of Enchantment.
If you need company recommendations outside of these major cities or you’re just looking for more general recommendations, you can read through our guide on choosing a solar company in NM.