See how much it will cost to install solar panels for your home in New Mexico
Our estimates used by
Solar power in New Mexico
Last fact-checked on January 19, 2023, by Catherine Lane
New Mexico gets more sun than many other states in the US, meaning a solar system will produce more in New Mexico than it will in other parts of the country. A high-producing system combined with the state’s net metering law means that there is potential for some serious savings in New Mexico.
Although the state is lacking when it comes to state-wide incentives, as compared to other states, this is offset by some of the major investor-owned utilities that offer rebates to their solar customers. And with recent changes to the renewable portfolio standard, new incentives or rebates could start appearing in order to help utilities reach their zero-carbon emission goals.
Recently, Governor Grisham put a new state solar tax credit incentive into place. This has the potential to save New Mexico homeowners thousands on their solar panels.
Compare solar quotes from the top solar companies in New Mexico
New Mexico solar power facts
$2.82 watt
Average cost: 5kW solar power system
?4 Years 9 Months
Average payback time
$74,986
Average lifetime savings
?4¢ kWh
Levelized cost of solar energy
37¢ kWh
If you don't get solar
?9,750 kWh
Annual power production
Cash flow graph based on cash purchase of a 6.07kW system
This 6.07kW system would offset 100% of your energy usage if your typical monthly bill in New Mexico is $169, however, your situation may vary so try our solar calculator to get a result tailored to you.
10
Solar companies in New Mexico that provide pricing through the Solar-Estimate marketplace.
How much can solar panels save you in New Mexico
Average total cost of solar panel installation in New Mexico
| System Size | Cash purchase After 30% solar tax credit |
Financed purchase After 30% solar tax credit |
|---|---|---|
| 3kw | $6,111 | $6,600 |
| 4kw | $8,036 | $8,679 |
| 5kw | $9,870 | $10,660 |
| 6kw | $11,676 | $12,610 |
| 7kw | $13,377 | $14,447 |
| 8kw | $15,064 | $16,269 |
| 9kw | $16,632 | $17,963 |
| 10kw | $18,200 | $19,656 |
How much do solar panels cost in New Mexico?
$2.82 per watt
Cash purchased solar system
Before 26% solar tax credit
$3.02 per watt
Financed solar system
Before 26% solar tax credit
$15.7¢ /kWh
Lease/PPA
Ave 15 year term, 2.5% price escalator
What are the pros and cons of installing solar panels in New Mexico?
The advantages of installing solar panels in New Mexico include the net metering policy, the federal tax credit, and all of the available utility rebates. Also, lots of sunshine means that a solar system in New Mexico will produce a lot of energy.
The disadvantage of installing solar panels in New Mexico is that there is very little in the way of state incentives. However, the decreasing price of solar makes up for what the state may lack incentive-wise.
Enter your details to calculate the potential costs and savings you can get from installing solar panels for your home.
Best solar companies in New Mexico
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Find local information for cities in New Mexico
Compare solar quotes from the top solar companies in New Mexico
How much electricity will solar panels produce in New Mexico
Solar panels produce different amounts of energy in different locations.
Around the Albuquerque area solar panels installed on a south-facing 27-degree pitch roof will typically produce:
1,150kWh
per year per 1kW of peak DC
(direct current) capacity
For more information about how your location, roof direction, and roof tilt affects solar power production use the solar panels calculator and enter your zip code.
I want to buy a solar panel kit and install it myself
What rebates, solar tax credits and other solar incentives are available in New Mexico?
Net metering in New Mexico
New Mexico law requires all utilities that are regulated by the Public Regulation Commission to offer net metering to their customers.
The law outlines two ways in which a utility may offer net metering:
- A utility may credit or pay for excess energy sent to the grid at the avoided cost rate, which is essentially the cost for a public utility to produce one more unit of power; or
- A utility can provide a credit that is equal to 1 kilowatt hour (kWh) of energy for each kWh of excess generation sent to the grid. These credits can be carried over from month to month indefinitely.
Check your electric utility’s website to find out more about their net metering policy.
Renewable portfolio standard and RECs
In 2019, New Mexico passed a bill that established a new renewable energy target of having 40% of retail electricity sales come from zero-carbon resources by 2025. Of that target, 20% of the electricity must come from solar. In order for a utility to reach this goal they must obtain renewable energy credits (RECs).
RECs represent the positive environmental attributes of generating 1 megawatt (MW) of energy from renewable sources. Once you register your system with the state, it will begin producing RECs that you can sell.
Some utilities offer a performance-based incentive where they will pay you a fixed rate per kWh of energy your system produces in exchange for the RECs your system creates. This provides you with a reliable, standard rate for your RECs and allows your utility to meet their renewable energy target.
For example, if you are a customer of El Paso Electric, they will pay you $0.02 per kWh of energy your system produces in exchange for your RECs.
Other utility programs, like Xcel Energy's program, are fully subscribed, so they can no longer offer incentives. This could happen to other utilities, so the sooner you sign up, the better!
Is it better to lease or purchase solar panels in New Mexico?
It can be difficult to decide how to finance your solar system. Various zero-down solar leases and solar power purchase agreement (PPA) products are popular in New Mexico because they minimize upfront costs for installing solar. However, instead of entering into a third party-owned solar lease or PPA, you are likely to see far greater savings over the life of a system if you purchase your solar panels outright, whether it be with cash or through a loan.
You can use the solar savings calculator to see the difference in the overall savings over the life of a system.
Property tax exemption
New Mexico offers a property tax exemption when you install a solar system on your home. For the purpose of property tax assessments, residential solar systems will not be treated as an improvement to your property and therefore will not increase the amount that you pay in property taxes.
New Solar Market Development Income Tax Credit
New Mexico has a great income tax credit incentive that can be used in addition to the 26% federal tax credit.
The incentive, called the New Solar Market Development Income Tax Credit, is equal to 10% of the total purchase and installation costs of a solar panel system. Systems that have been installed on or after March 1, 2020 can apply for the tax credit.
The amount of credit put towards your income taxes cannot exceed $6,000 per taxpayer per taxable year. If the amount of your credit exceeds your tax amount, it can be carried over for five consecutive taxable years
New Mexico Solar Calculator
Regardless of what you want to know about the economics of installing solar panels for your home or business in New Mexico, we have a solar calculator that can show you exactly the information you require.
What you can find out about installing solar panels in New Mexico using our full monthly solar calculator
This solar calculator requires you to input your address, utility company, your average monthly power spend - It tells you:
- What size solar system do you need?
- Answers the question of how many solar panels do I need?
- How many square feet of roof space you need for solar panels
- Solar electricity production in annual kWh (kilowatt-hours) you can expect from your solar system in New Mexico
- The value of solar tax credits and other incentives you are entitled to based on the estimated size of system you need, your location and your utility provider.
- Likely cost based on an average of prices charged for solar systems of that size in the last year in New Mexico or Albuquerque ;
- The likely payback period on your solar panels and your investment return.
- Your total lifetime solar savings based on each of the major solar finance options, a cash purchase, a cash purchase funded with a HELOC sol (home equity line of credit) and a zero-down PPA or third party lease product.
If you want to see all of the above but also see live pricing, the three best solar deals available in your city and get binding quotes from each of these solar companies then use this New Mexico solar panels calculator. This calculator requires you to also input your name and contact details because most of our 200+ installer partners will only authorize the sharing of their live solar pricing where we have validated that you are a real homeowner with a home in their service area. We respect the privacy of your data and only share your contact details with the solar companies you ask us to get binding quotes from.
Going solar in New Mexico
Check out all of the ways energy providers of New Mexico can help you be more energy-efficient and save money.
The following programs are available:
| Incentive Name | Eligibility | Type |
|---|---|---|
| Residential Clean Energy Tax Credit | Federal | Personal Tax Credit |
| Property Tax Exemption for Solar Systems | State | Property Tax Incentive |
| Net Metering | State | Net Metering |
| New Solar Market Development Income Tax Credit | State | State Tax Credit |
| PNM - Performance-Based Solar Program | Utility | Performance-Based Incentive |
Find your local rebates and incentives
Your city may have further incentives to offer. Please keep in mind that the best source of up-to-date information on incentives is the solar installers who specialize in your area.
