In the year since New Mexico's state tax credits for solar panel installations lapsed, Positive Energy Solar has had to lay off or leave vacant 15 jobs. The Solar Foundation reported a 16 percent decrease in the number of people employed in the solar industry statewide, from more than 3,000 to 2,522. Solar energy advocates say the loss of a 10 percent tax credit that expired in 2016—and was fully allocated for half a year before that—is to blame, and legislators have been working to reinstate it.
"Consumers perceive a loss of value with the lost tax credit—a lot of them knew about it, a lot of them were disappointed to see it end, and a lot of them hoped it would come back," says Regina Wheeler, CEO of SunPower by Positive Energy Solar.
Two bills still alive in the waning days of the session would reinstate tax credits for solar installations, and expand those credits to include small businesses and agricultural operations. HB 87 awaits a hearing in the Taxation and Revenue Committee, and SB 79 passed the Senate on Monday.
Next, they face a grim gauntlet: Their predecessors have died on the governor's desk.
There's a chance this year's efforts will see the same fate, says Rep. Carl Trujillo (D-Nambé), who introduced the House version with Reps. Debbie Rodella (D-Española) and Patricio Ruiloba (D-Albuquerque), "But I think what's important here is that it continues the discussion and shows that the Legislature is committed to this, to the use of more renewable energy."
Both bills would reinstate a 10 percent income tax credit for people who install solar panels or solar thermal systems, capped at $9,000 per recipient. The total program limit would be set at $5 million annually. The House bill ends those credits in five years. Initially, the Senate companion called for phasing credits out over 15 years, but Albuquerque Democratic Sen. Mimi Stewart, who introduced the bill, amended it on the Senate Floor to phase out over 10 years instead. The move, she said, was to garner more bipartisan support and simplify the tax credit structure. The bill passed 35-6. Objections arose over the reliability of solar and the problematic nature of long-term storage, that these credits would disproportionately benefit wealthy families (Stewart insists the credit's historic use shows families from all income brackets benefited), and the general approach of subsidizing private business.
The longer term initially proposed offers companies consistency, Stewart says, but seems to be a sticking point with Republican lawmakers. Five years for a tax credit seemed palatable to his fellow lawmakers, Trujillo says.
"If I felt that I could get mine forever, I would do that, but the chances of it getting out [of committee] are less," he says. "Many legislators look at the fiscal impact to the budget, and when they see it for an extended period of time, it usually raises some concerns."
Both bills are good, says Sanders Moore, director of Environment New Mexico, but if she had to pick a favorite, it'd be the Senate version as introduced.
"The Senate bill provides a soft landing for the solar industry, and it also allows more New Mexicans to take advantage of solar energy for more years," she says. "We're the second sunniest state in the country, so we really should be a national leader in renewable energy."
More than 7,700 New Mexicans used the solar tax credit in place from 2008 to 2016, according to Environment New Mexico, installing more than 46 megawatts of solar infrastructure to make use of more than 310 sunny days each year.
"Just a few years ago, we were in the top 10 states for our administrative procedures and our tax credits and our promotion of solar energy," Stewart says. "We've now dropped to 29th under this administration. … It just seems nuts that New Mexico would not be a leader."
She says more than 70 percent of New Mexicans favor increasing renewable power and an increasing awareness of climate change underlies that support. Both she and Trujillo spoke about the solar power installations on their own homes—something she could just barely afford on a "crappy teacher pension," she says. Trujillo says his power bill now is just $15 a month, even while running the air conditioning in summer.
The 10 percent credit could offset prices that increased when President Donald Trump imposed a 30 percent tariff on solar panels, the bulk of which are manufactured overseas.
"Without the tax credit, we'll have a difficult year," says Wheeler, "and it'll definitely decrease the ability of the industry to add jobs in New Mexico."