New Mexico solar panels: The complete guide in 2024
Data updated Nov 12, 2024
Interested in going solar? You'll need to install a 9.17 kW solar panel system to cover the average electric bill in New Mexico, which will cost you about $19,314 after the federal tax credit.
Cost for an average system in New Mexico
As long as your federal tax bill is high enough, you can take advantage of the federal investment tax credit (ITC).
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- Overview
- Solar cost
- Incentives
- Electricity cost
- Companies
Going solar in New Mexcio
The Land of Enchantment’s sunny skies and solid net metering programs make it a natural fit for solar panels.
Factor in the federal solar tax credit and New Mexicans can cut the cost of solar panels by thousands of dollars, speeding up their payback period and increasing the value of their investment.
Here's our guide to going solar in New Mexico.
Cost
How much do solar panels cost in New Mexico?
Solar panels will save you a lot of money over time, but the upfront costs aren't cheap. The average New Mexico homeowner needs a 9.17 kW solar panel system to cover their electricity needs, which comes out to $27,591 before incentives. Prices range from $23,452 to $31,730, but after the federal tax credit, that drops by 30%.
While this may sound high, it will pay off in New Mexico. That's why over 7,700 New Mexico homeowners have used EnergySage to receive and compare quotes for solar installations. You can expect to earn back your initial solar investment through electricity savings in about 10.76 years, while most systems last at least 25 years. You'll often see this number referenced as your solar payback period.
There are a few ways to finance your solar panel system so you don't have to provide all that money upfront.
Cash purchase: You'll own the system and pay for it upfront. This provides the best long-term savings.
Solar loan: Allows you to retain ownership of your system, while owing little to no money upfront. Solar loans aren't all created equal: If you have access to subsidized clean energy loans through local incentive programs, that's usually your best bet. A home equity loan or a personal loan are often your next best options – private solar loans typically come with higher interest rates or upfront fees.
Solar lease or power purchase agreement (PPA): A third-party company owns your system and either leases you the solar panels (solar lease) or allows you to purchase the electricity they generate (PPA). These generally provide the lowest savings and generate the most negative press about solar. If you choose this financing option, read the fine print: You can get trapped in them for longer than you'd like.
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Incentives
What are the best solar rebates and incentives in New Mexico?
Incentives help bring solar's price tag down considerably in New Mexico. Here are the major ones to know about:
Incentive | Average savings in New Mexico | Description |
|---|---|---|
Residential Clean Energy Tax Credit, formerly the federal investment tax credit (ITC) | $8,277 | Lowers your solar panel system's cost by 30% |
New Solar Market Development Tax Credit | Up to $6,000 | Lowers your solar panel system’s cost by 10%, up to $6,000 |
Sustainable Building Tax Credit (SBTC) | Varies based on square footage and the level of certification achieved | Tax credit earned for sustainable building efforts |
New Mexico solar property tax exemption | 0.74% of your system’s cost, annually on average | If you use solar energy as a source of power, you won't need to pay for the value your solar panels add to your property. |
Is net metering available in New Mexico?
In some states, you'll earn bill credits from your utility company when your solar panel system generates excess electricity and sends it to the grid. This incentive is known as net metering—basically a solar buyback program—and makes it so you will owe very little, or even nothing, on your electric bills with solar panels.
Regulated utilities in New Mexico are required to offer net metering, and their rates are pretty good. You’ll be credited at the retail rate of electricity for every kWh you contribute to the grid until your generation is equal to your utility demand. If you send more electricity to the grid than you demand from it, you’ll be credited at the avoided cost rate for that excess generation.
Learn more about net metering in New Mexico or specific utility programs:
Equipment
Equipment quality
Each year, solar panels get more and more efficient—that is, they produce more power per square foot. As of 2024, the most popular solar panels can produce about 400 watts of electricity when they’re in full sunlight. If you want to make the most of your roof’s solar potential, get panels with at least that much power output.
You should also make sure to select a solar inverter setup that makes sense for your roof’s layout.
And if you want or need a solar battery, be sure to pick one that can integrate cleanly with that inverter.
Premium equipment can come with a high price tag, but it will often save you more money in the long run. The best equipment tends to have the best warranty terms, often guaranteed to 25 years (sometimes even 40!), so you’re covered in case you need repairs or replacements. The highest-quality panels also degrade more slowly, so they’ll maintain more of their power output further into the future.
Companies
Who are the best solar installers in New Mexico?
We pre-screen all of the solar companies on EnergySage to ensure they'll provide you with a high-quality installation. We then rate them based on their results, reputation, and responsiveness. Here are the highest-rated EnergySage installers in New Mexico:
Ready to start looking for a solar installer?
Here are some of the most popular ones near you:
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resources
Top solar resources for New Mexico
- New Mexico Solar Loan Providers
Search through our list of top loan providers to finance your solar panel system.
- New Mexico Energy, Mineral, and Natural Resources Department
Learn about the NM Energy Conservation and Management Division from the state government.
- NM Public Regulation Commission
Read more about how utility companies work in NM.
- New Mexico Electricity Profile (EIA)
Learn about NM energy production and prices.
- NM State Solar Factsheet (SEIA)
See quick stats about how much solar energy has grown in NM.
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