The New Mexico Legislature's House Committee on Energy, Environment, and Natural Resources convened on February 8, 2025, to discuss House Bill 211, which aims to revitalize the state's solar market through significant tax credit reforms. Representative Ferrari introduced the bill, emphasizing its potential to encourage the installation of photovoltaic systems with a minimum of 15 kilowatt hours of solar storage capacity.

Ferrari highlighted the pressing need for this legislation, citing a notable decline in solar installations in New Mexico, with over 100 solar companies shutting down in the past two years due to high prices and supply chain disruptions exacerbated by the COVID-19 pandemic. The bill proposes a new corporate solar market development tax credit that would allow taxpayers to roll over their eligibility for tax credits, simplifying the process and making solar energy more accessible.

Expert witness Rocky Backus presented data indicating that only $6.1 million of the $30 million allocated for solar tax credits was utilized in the previous year, underscoring the need for reform. He explained that the proposed changes would not impact the state budget but would streamline processes and clarify eligibility for tax credits, particularly for power purchase agreements (PPAs).

The committee discussed the advantages of PPAs, which allow homeowners to install solar systems without upfront costs, as the provider covers installation and maintenance. Backus noted that these agreements could lead to significant savings on electricity bills, with costs potentially dropping by 30% to 70% compared to traditional utility rates.

Concerns were raised regarding the impact of increased solar adoption on grid reliability and the potential for rising costs for non-solar customers. Representative Montoya expressed apprehension that as more consumers opt for solar, the remaining ratepayers might bear higher costs. Backus responded that increasing solar capacity could alleviate pressure on utilities, ultimately benefiting all consumers by reducing the need for costly infrastructure investments.

The committee concluded with a lack of opposition to the bill, and Representative Ferrari reiterated the importance of making solar energy more accessible to foster job creation and economic growth in New Mexico. The discussion highlighted the potential for House Bill 211 to reshape the state's energy landscape, making solar energy a more viable option for residents and businesses alike.