Incentives

There are a lot of financial incentives for cutting carbon and going electric that can be combined for greater savings. But knowing what incentives you, your home improvements and your installer qualify for is tricky.

Do YOU qualify?  

Eligibility for different programs depends on your income and other factors such as where you live; household size; health status; if you are a homeowner, landlord or renter; and whether you pay taxes or not.  Some PNM programs are only for customers who have used their Check-Up program. Some Coop rebates are only available for customers who contact the Coop first.

Do you qualify for NM State Programs?  (This includes the Federal Inflation Reduction Act Rebates for Low-Income residents).

 

Does your EQUIPMENT qualify? 

Some equipment like heat pumps must meet minimum technical standards that change every year. Your installer should check that the heat pump is eligible and give you a certificate to that effect. In theory, New Mexico does not give tax credits for heat pumps if they are installed with a gas furnace (dual fuel systems).

Does your INSTALLER qualify?

Some PNM rebates are only available through its “Midstream Program” for equipment installed by contractors who have gone through PNM’s training program.

 

 

 

 

Incentives are available from:

    • Federal government –  for people who pay federal taxes and for people buying an electric or hybrid vehicle who transfer tax credit at time of sale
    • New Mexico state government (Website) – rebates, tax credits, programs for all income levels, state taxpayers and non-state taxpayers
    • Electricity provider – rebate programs for customers and low-income customers
    • Non-profits – low-income
    • Manufacturers

There are eligibility requirements both for equipment,

 

Eventually Rewiring America’s Savings Calculator will be a one-stop source for finding every program you are eligible for, but they have not yet updated the calculator for New Mexico. The ENERGY STAR Rebate Finder may be helpful

Types of Incentives

Rebates

Rebates are discounts off the purchase price.  They can be implemented in different ways. For example:

  • New Mexico state administers the IRA Rebates for Low-Income residents only. Find out if you qualify, what products are eligible and how to apply.  
  • Check with your Rural Electric Coop, which might, for example, give you $1,800 after you install a heat pump and fill out a form.
  • Check with your utility, which may give you an effective rebate by offering you discounts when you purchase a heat pump from a selected list of contractors.
Tax Credits

A tax credit reduces the amount of state and/or federal taxes you owe.  You may have to apply for a certificate and/or obtain certain paperwork before you can apply for the credit when you file your taxes.

If you do not owe state taxes, however, you may still receive funds for certain electrification action/incomes that qualify for “refundable tax credits” (see below).

If you do not owe federal taxes, you may get a discount on your electric or hybrid vehicle if you transfer your tax credit to the dealer at the time of purchase.

  • Non-refundable tax credits can only be applied up to the amount of taxes you owe. The IRA tax credits are non-refundable. For example, the tax credit for heat pumps is 30% of the cost up to $2,000. So if you spend $8,000 on a heat pump, you could file for a $2,000 tax credit (30% of $8,000 is $2,400, but only $2,000 maximum is allowed). If you owe $2,000 or more in taxes you will be able to subtract $2,000 from your tax bill. If you owe only $800 then you will only be able to subtract $800. If you owe no taxes, you will not be able to use the tax credit. You must subtract any utility provider rebate you receive from the price of the heat pump or other equipment before calculating your cost.
  • Refundable tax credits do return the full amount of the credit to you even if you do not owe any taxes. The NM Sustainable Building Tax Credit passed in 2021 is refundable for qualifying low-income residents (income less than 200% of Federal Poverty Level (2024 levels)). You must obtain a “2021 Sustainable Building Tax Credit” certificate from the Energy, Minerals and Natural Resources Department. For heat pumps, for example, it is $2,000 for very low-income residents. For everyone else the state credit is up to $1,000 for heat pump installations and is non-refundable, but any unrefunded excess can be carried over to 7 subsequent tax years.
Low-Income programs

There are several programs that weatherize and upgrade energy systems for low-income residents at no cost.

What do I qualify for?