Why NM Legislators Should Vote for HB 201
Sponsored by Rep. Abbas Akhil, this bill would provide tax credits for individuals who purchase renewable energy storage systems. Tax credits are limited to whichever is less: $5,000 or 40% of the cost of the installation. HB 201 caps the total amount of tax credits to be issued each year at $500,000. The State Energy Minerals and Natural Resources Department will issue rules to determine what systems will be deemed eligible for the credit. This is a small pilot program (hence the relatively small $500K cap) that would be available only to residences and business entities that are served by a rural electric co-op that uses time-of-use billing for peak and off-peak energy use. This pilot would generate data that could then provide incentive to create similar but longer-term and larger programs.
HB 593, a similar bill, was introduced in 2019 by Reps. Akhil, Sariñana, and Small. It passed the House Energy & Natural Resources Committee and then died in the House Taxation & Revenue Committee without a hearing.
Why This Bill is Good for New Mexico
- According to the EPA, a typical gasoline-powered passenger vehicleemits about 4.6 metric tons of carbon dioxide per year, and as of 2017, only 1.2% of US passenger vehicles were electric.
- Home-based energy storage and charging systems are essential to encouraging New Mexico residents to purchase electric vehicles.
- In addition to incentivizing New Mexicans to purchase electric vehicles, a home energy storage system tax credit can also reduce a household’s reliance on carbon-based energy for its household energy consumption.
- The sun doesn’t shine 24-7. But by storing the electricity that's generated and saving it until it's needed, energy storage is aiding in the expansion of low-cost renewable energy and playing a critical role in modernizing the electric grid.
- A similar federal tax credit introduced by NM Senator Martin Heinrich has been backed by the Energy Storage Association, National Electrical Contractors Association, and National Electrical Manufacturers Association.
- According to Maine Senator Jack Reed: “Tax credits for installation of home energy storage are critical to promoting the use of renewable energy. Establishing investment tax credits for energy storage plays an important role in capturing the energy generated by clean, sustainable sources such as wind and solar. Providing incentives for the creative and effective storage of energy will help prepare individual households, industry, utilities and our nation’s electric grid to navigate the future of clean power and energy efficiency.”