SANTA FE – New Mexico will reinstate a solar tax credit and prepare to modernize its energy grid under a package of bills signed into law Tuesday.
Gov. Michelle Lujan Grisham said the legislation will make solar power more accessible and support jobs in renewable energy.
“Climate change is a monumental challenge that requires innovative solutions,” Lujan Grisham said in a written statement.
She approved three bills Tuesday – each of which picked up significant bipartisan support in the 2020 legislative session.
The legislation includes making electric transmission lines eligible for certain tax breaks, reinstating a solar tax credit for homeowners and small businesses, and charting a long-term strategy to improve the state’s aging, centralized energy grid.
“This bill will help bring New Mexico’s electric grid into the 21st century to ensure we have a reliable, resilient and secure energy future,” Democratic Rep. Melanie Stansbury of Albuquerque said.
Parts of the legislative package drew opposition during the session from Republican lawmakers who said the solar energy industry should stand on its own, without the adoption of financial incentives that cost the state revenue.
On Tuesday, Lujan Grisham signed:
• Senate Bill 29, reestablishing a tax credit for up to 10% of the cost of installing a solar-energy system, with a $6,000 limit per household. A similar credit expired in 2016.
The credit is expected to cost the state roughly $3.4 million to $7.5 million in revenue a year.
The legislation was sponsored by Senate Majority Whip Mimi Stewart, D-Albuquerque, and Rep. Matthew McQueen, D-Galisteo.
• House Bill 50, which makes electric transmission lines eligible for industrial revenue bonds, a mechanism generally used to provide property tax breaks.
The law will allow the state and county government to approve the bonds for private developers building transmission lines, not just transmission stations.
Legislative analysts said the potential loss of government revenue is difficult to estimate.
The bill was sponsored by Rep. Nathan Small, D-Las Cruces.
• House Bill 233, which calls on state executives to develop a broad strategy to update the state’s energy grid, partly to better handle renewable energy.
The bill also creates a grant program to help finance grid-modernization projects, and it allows the Public Regulation Commission to approve changes to energy rates to finance similar projects carried out by some utilities. The measure was sponsored by Stansbury, Small, Stewart, Democratic Rep. Abbas Akhil of Albuquerque and Republican Sen. Pat Woods of Broadview.