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Renewable Energy Production Tax Credit (Corporate)

Eligibility 
Commercial
Industrial
Savings Category 
Solar Thermal Electric
Solar Photovoltaics
Wind (All)
Biomass
Municipal Solid Waste
Landfill Gas
Anaerobic Digestion
Maximum Rebate 

Wind and biomass: First 400,000 MWh annually for 10 years (i.e., $4,000,000/year)
Solar electric: First 200,000 MWh annually for 10 years (annual amount varies)
Statewide cap: 2,000,000 MWh plus an additional 500,000 MWh for solar electric

Program Info
Sector Name 
State
Administrator 
Taxation and Revenue Department
Expiration Date 

01/01/2018

State 
New Mexico
Program Type 
Corporate Tax Credit
Rebate Amount 

$0.01/kWh for wind and biomass
$0.027/kWh (average) for solar (see below)

Summary 

Note: The tax credits are fully subscribed. As of February 2015, there are 712 MW (1,400,000 MWh) of projects in the waiting queue for the wind/biomass tax credit and 464 MW (1,212,000 MWh) of projects in the waiting queue for the solar tax credit.

Enacted in 2002, the New Mexico Renewable Energy Production Tax Credit provides a tax credit against personal or corporate income tax. To qualify, an energy generator must have a capacity of at least 1 megawatt and be installed before January 2018. 

Amount

The tax credit is $0.01 per kilowatt-hour (kWh) for companies that generate electricity from wind or biomass. Companies that generate electricity from solar energy receive a tax incentive that varies annually according to the following schedule:

  • Year 1: $0.015 per kWh
  • Year 2: $0.02 per kWh
  • Year 3: $0.025 per kWh
  • Year 4: $0.03 per kWh
  • Year 5: $0.035 per kWh
  • Year 6: $0.04 per kWh
  • Year 7: $0.035 per kWh
  • Year 8: $0.03 per kWh
  • Year 9: $0.025 per kWh
  • Year 10: $0.02 per kWh

According to the Energy, Minerals and Natural Resources Department, this incentive averages $0.027 per kWh annually.

For wind and biomass generators, the credit is applicable only to the first 400,000 megawatt-hours (MWh) of electricity in each of 10 consecutive taxable years. For solar, the credit is applicable only to the first 200,000 MWh of electricity in each taxable year. 

Aggregate Cap

Total generation from both the corporate and personal tax credit programs combined must not exceed 2,000,000 MWh of production annually, plus an additional 500,000 MWh produced by solar energy. Taxpayers cannot claim both the corporate and the personal tax credit for the same renewable energy system.

Excess Tax Credits 

For electricity generated prior to October 1, 2007, excess credit may be carried forward for up to 5 consecutive taxable years. For electricity generated on or after October 1, 2007, excess credit shall be refunded to the taxpayer in order to allow project owners with limited tax liability to fully utilize the credit.