Albuquerque averages 310 sunny days. Consider how to use this sun for solar power.
The Office of Energy Efficiency and Renewable Energy provides an online owner’s guide to the federal solar photovoltaic tax credit. It is available in English and Spanish.
While there is a caveat that it provides insight and shouldn’t be your sole source for making a decision, it’s a good start.
Federal tax credit
The Federal Residential Solar Energy Credit is a tax credit that can be claimed on federal income tax for a percentage of the cost of a solar photovoltaic (PV) system. The system must be in service during the tax year and generate electricity for a home in the United States. In December 2020, Congress passed an extension of the ITC, which grants a tax credit of 26% for systems installed in 2020-22 and 22% for systems installed in 2023. There is no maximum amount that can be claimed. The Build Back Better Act provides for an extension of the solar tax credit.
What expenses are taken into account for the calculation of the tax credit?
• Photovoltaic solar panels or photovoltaic cells used to power an attic fan, but not the fan itself.
• Contractor’s labor costs for on-site preparation, assembly or original installation, including permit fees, inspection fees and developer fees.
• System balancing equipment, including wiring, inverters and mounting equipment.
• Energy storage devices that are charged exclusively by the associated photovoltaic solar panels, even if the storage is put into service in a fiscal year subsequent to the one in which the solar energy system is installed. However, energy storage devices are still subject to date of installation requirements.
• Sales taxes on eligible expenses.
What expenses are NOT included in the calculation of the tax credit?
• If you finance the system, interest due on the financing, origination fees and warranty extension expenses are not eligible for the tax credit.
We are used to seeing solar panels on rooftops, but they don’t have to be installed on a roof as long as they generate electricity for your home. Check zoning and building code requirements.
NM Tax Credit
According to the Department of Energy, Minerals and Natural Resources (EMNRD), the Solar Market Development Tax Credit provides a 10% tax credit for small solar systems, including photovoltaic systems in grid and off grid and solar thermal systems. The tax credit runs until December 31, 2027. There is a cap of $ 8 million in tax credits to be issued each year on a first come, first served basis. A check on their dashboard shows a total amount of credit approved so far in 2021 of $ 4,266,127. Additional information on the program is available on the EMNDD website. The contractor you are considering for your solar system can help you understand tax credits and other programs.
The price PNM will pay you for renewable energy certificates, called “RECs,” generated by your solar power system is 0.0025 ¢ (1/4 cent) per kilowatt hour for all programs and is set by the RPC.
The PNM Interconnection consists of installing your own electricity production on your home or commercial building. You can benefit from net metering when a qualified system is installed and connected to the PNM power grid. This means that since your system is producing power, you only buy power from PNM when you have used more power than your system is producing in each billing period. Check the PNM website for more information on solar and wind programs.
According to the Renewable Energy Industries Association of New Mexico, PNM has 18 full capacity distribution lines and cannot add additional solar systems to those lines. PRC 21-00266-UT examines this technology and new technologies in solar systems.
CNM offers a certificate of achievement in solar electricity. According to its catalog, the certificate offers students the opportunity to acquire the knowledge and technical skills necessary to enter and explore careers in the field of solar electricity (photovoltaic-PV). Students are given an overview of residential, commercial, large commercial and industrial systems. Students learn how solar electricity is created and how to get the best output. Emphasis is placed on code compliant design, installation, commissioning, operation and maintenance practices. The certificate program can be completed on its own or as part of the electrical trades programs. The CNM website provides information on top jobs, salaries, openings and expected growth.
According to the Solar Career Map, jobs in the solar industry include manufacturing, system design, project development, installation, and operations. The Solar Energy Industries Association reports that New Mexico has 1,880 solar jobs, measured in the third quarter of 2021.
Searching the internet will provide you with resources, ranging from a contractor appraisal, solar panel placement, calculating how profitable your investment will be, and future growth and technology.
Sources: www.energy.gov/eere/solar/homeowners-guide-federal-tax-credit-solar-photovoltaics; www.emnrd.nm.gov/ecmd/tax-incentives/solar-market-development-tax-credit-smdtc/; www.pnm.com/interconnection-process; www.cnm.edu/programs-of-study/programs-az/electrical-trades; www.seia.org/state-solar-policy/new-mexico-solar; www.reia-nm.org