- Consider whether your motivation is more environmental, economic, or both
- The more you currently spend on electricity, the greater your financial benefit
- New Mexico tax credits and the Inflation Reduction Act are shortening the payback period for solar installation costs
- A property solar evaluation is required to measure the benefits of solar and provide an accurate analysis and pricing
“What are you hoping to achieve with solar energy?”
That’s one of the first questions we ask our customers when they come to us to start learning about solar energy. Residential solar power can lower a homeowner’s carbon footprint, create greater energy independence, and crucially, also save money in the long-term. It’s important to understand what your goals and expectations are when determining if solar is worth it to you. If you’re new to solar, this beginner-friendly guide will outline a thorough overview of the process of going solar in New Mexico and help you discover whether it’s a good fit for you and what options you may have available.
Note: Solar should be seen as a long-term investment to your home and the decision process should take that into consideration. Choosing the right company to facilitate your project can make a big difference in the financial & environmental impact, and your overall satisfaction with your investment.
If you're like the majority of our clients, you likely feel that climate action and reduction of environmental pollutants is a major factor in your consideration to install solar panels. 20% of all U.S. greenhouse gas emissions are directly attributed to household consumption, mostly in the form of utilities. Powering your home with solar is a tangible way to take action to change this and be part of the solution. You'll want to consider and weight out the importance of these environmental benefits with the financial savings.
Consider this: If you had monthly payments for solar energy that were the same as your utility bill (no monthly savings) would you still be interested in making the switch, or do you require some kind of economic benefit? Are you doing it because you feel its the right thing to do, or do you need a payback—how much and how quickly?
How much energy does your household consume?
There are fixed costs associated with having solar panels installed, whether it's one solar panel or a few dozen—these are things like permit & utility interconnection fees, system engineering, project management, etc. As a general rule, if your PNM electric bill averages out to $90/month or more, the economics of solar in New Mexico begin to pencil out. Because of PNM rate structures, the more energy your household consumes, the more financial benefit you stand to gain from solar. This is due to the levelized cost of energy (LCOE) which describes the cost of the power produced by solar over a period of time (typically the warranty period), compared to buying power from the utility company.
PNM electricity costs (as of 12/19/2023)
As you can see, the cost of energy from PNM ranges from around $0.08/kilowatt hour (kWh) to almost $0.15/kWh depending on how much energy you consume. If your household is consistently using more than 900 kWh per month, you're paying the highest rate for that energy. The LCOE from solar can be closer to $0.07-$0.13/kWh.
Locked in energy savings
Utility rates never go down—they go up, and then they stabilize and then they go up again. To put it into perspective, New Mexicans frequently witness electricity rates increase around 15% or more every four years. As the electric company steadily hikes its prices, having solar panels installed is an effective strategy to shield yourself from escalating costs and your payback period shortens with each utility increase. On average, you’ll see a payback period between 9-13 years. For some people it’s sooner, others later. Our solar proposals will show you these calculations and the numbers we used to calculate it.
Government solar incentives
Central to the deal are Tax credits and other benefits from both the state of New Mexico and from Washington, D.C., which can slash your solar investment by 40% and drastically reduce the payback period, benefiting you with an even greater return-on-investment (ROI). Thanks to the passing of the Inflation Reduction Act, the Federal government now offers a 30% solar tax credit. New Mexico solar tax credits provide an additional 10% (up to $6000) to help with solar panel costs.*
* To qualify for a benefit from the Federal or State Tax Incentive Credit, you must earn taxable income beginning the year the solar system is operational and should consult with your tax professional to see if you qualify for the available tax credits.
Increased home value?
As rooftop solar becomes increasingly prevalent in New Mexico (PNM expects a boost in rooftop solar users over the next 17 years, with an estimated 23% of PNM customers having rooftop solar by 2040) and monthly household expenses like utility bills continue to increase, it's likely that homebuyers will have a preference for more sustainable homes that come with lower bills. Based on reports from Zillow, Berkley, and Sandia National Labs, homes with solar panels sell faster and for more money (4.1%) than non-solar comparable homes.
Cash purchase or financing?
Whether you purchase your solar energy system or finance it, you own it and have an asset creating direct savings on your electricity bill. Paying cash will provide the greatest financial savings and ROI. Alternatively, you can finance the system with as little as no money down--that eliminates your up-front cost, but will cut into the savings as some of the avoided utility costs go to pay off interest.
Note: Some companies offer leases or Power Purchase Agreements (PPA) where the leasing company owns and maintains the panels and takes any rebates or tax incentives available for the system. Positive Energy Solar doesn’t offer these options because we don’t think it’s a good financial deal for customers & complicates the home selling process with liens and other concerns.
Property & feasibility considerations
The effectiveness of the system may also vary because of things specific to your house, including the placement of trees on or near the property. Whether your primary goal is to save on energy costs, reduce your reliance on fossil fuels, produce your own energy or all of the above, the first step will be to determine how many solar panels are required to meet your energy needs and what kind of offset is available. This isn't something you need to figure out, as it’s part of our free consultation process. There are six key factors to consider when determining if your roof will be a good fit for solar. These factors will impact the final design requirements and energy production potential of your residential solar system. A professional solar advisor will calculate how all of these factors come together and show you the net result for your home.
Orientation: Which direction does your roof face? A south-facing roof is the best because it will allow the solar panels to collect the most sunlight throughout the day. An east or west-facing roof will provide plenty of production as well—especially with todays higher efficiency solar panels.
Shade: The more exposed your roof is to sunlight throughout the day, the better. Take a look at trees, roof features, or other buildings that may shade your roof. You don’t need 100% sun on your roof to make solar viable for your home, though.
Size: The size of your recommended solar panel array will depend on your energy needs (as discussed in the previous section) but you need some open space to place a solar panel system. Do you have one large roof space or is your roof multi-faceted? These factors will affect the design of your system.
Pitch: What is the angle of your roof? The design and mounting equipment used on your roof will vary based on the pitch. Your solar advisor will take this into account when putting together your solar proposal.
Material: What is your roof made of? Installation and mounting requirements will vary based on what materials (composite shingles, tar & gravel, tiles, metal, etc.) were used for your roof. In New Mexico, flat roofing of various materials is common. While not every solar company can install on flat roofs, Positive Energy Solar can!
Age: If you think you might need to replace your roof in the next 2-3 years, consider installing solar after the new roof is in or potentially as a ground-mounted system (if feasible). There are costs involved with the removal and replacement of solar panels in conjunction with reroofing needs.
If your roof doesn’t check off everything on this list, don’t worry! Your roof doesn’t have to be perfect to be a great candidate for solar. You may also have an option for a ground-mounted solar system.
Solar company evaluation & considerations
As you can hopefully tell by now, having solar panels installed can be an environmentally and economically prudent decision for the right person, when done responsibly and with the right solar company. It’s important to hire a solar installation company that you can trust to provide accurate information, quality service & will be around for any after-sales support—what good is it to have a solar energy system that isn’t producing your expected energy needs and/or with a company you can’t get in contact with or doesn’t have the resources to provide after-sales support?
Vertically integrated, in-house installation teams
It might surprise you to learn that many "solar companies" in New Mexico are strictly sales-operations, acting as middlemen and subcontracting your project and solar installation to third-party contractors. This can lead to inconsistent quality, project delays, poor communication, and ultimately a frustrating experience. Some companies may lack a physical location in your area and may be operating out of someone’s home or lack established infrastructure.
An easy way to find out if the solar company you’re speaking with will be the one to do the installation is to ask them their scope of work, who will be installing your solar panels, and to ask for an electrical contractor license # which is required by any organization performing the installation. You can look up this license # to make sure they are in good standing.
After-sales support & dedicated service department
Even a solar company with in-house installation crews may not have the bandwidth or operational capacity for after-sales support and equipment maintenance (few companies do). While solar equipment is reliable and durable, it’s inevitable that something may come up during your lengthy warranty (25+ years)—even if it's as simple as a system underperforming. Ask the solar company what their process and timeline is like for service work, and whether they have a dedicated service department to handle claims. If their installation crew handles service work, they may not be able to provide you support in a timely manner, costing you with every minute your solar panels aren't producing energy.
Longevity, expertise & bankability
If you're trying to determine whether solar is worth it for you, you need to know you're basing things off of accurate information, the assumption that all costs have been included, and that the solar company you choose will stick around. Because of the solar energy potential and incentives in New Mexico, there's a lot of fly-by-night solar companies popping up. You want to choose a solar company with proven expertise and knowledge around utility solar programs and their billing, solar incentives, and local building and electrical code; failure to do so may result in unexpected energy costs, delays in approval to turn your system on, or missing out on New Mexico solar incentives (Positive Energy Solar has dedicated personnel that monitors remaining tax credit funds and files necessary paperwork to claim these funds for our clients).
Because the solar industry can be volatile, it can be hard to know which solar companies are in good financial health and likely to stick around. A company that's weathered the storms and been operating for a longer time will usually be a good sign of stability, especially if installing solar is their only business model. Don't be afraid to ask about their financial standing, and get a good sense of their operations.
Online reviews can be misleading
When researching solar companies (or any home service company, really) don’t just rely on overall rankings. Some companies may manipulate reviews by having employees or non-clients create submissions or if it's a newer solar company, they may not have been around long enough for clients to experience the after-sales support. Delve into lower-ranked reviews, looking for consistent issues and observe how the company responds. Check multiple sources, such as google, nextdoor, yelp & be sure to look for any complaints with the Better Business Bureau. Don’t forget to investigate any subcontractors if applicable.
Ready to learn more and see if solar makes sense for you? Our process.
Once you’re ready to see the specifics of solar for your home, it’s time to talk to your local solar experts. You’ll find Positive Energy Solar’s approach is consultative, without the high-pressure sales tactics. Our goal is to ensure you fully understand what your options are and to allow you to make an informed decision that is right for you and your family. Our process involves:
1. Determine energy needs. We’ll collect all the relevant information needed to work up an accurate proposal for you and help answer any other preliminary questions.
2. Custom design & site evaluation. Your solar advisor will work with you to schedule a site visit where you can go over the proposal together and they can check the property for solar feasibility and ensure accuracy in our findings. We’ll work with you to modify the proposal for anything necessary to make sure we’ve built the perfect solar energy system for your needs.
3. Sign up. Once you’re happy with your proposal and have signed your agreement to partner with us, our in-house team springs into action to make your on-paper solar energy system a reality on your roof (or ground).
4. White glove service—We handle everything from here. Typically, it takes about 12 weeks from sign-up to energizing your solar panels, as we take care of the permitting, utility paperwork, HOA communications and covenants (if necessary), engineering & installation. But our work doesn't end here. We'll submit your paperwork to receive New Mexico's solar tax credit approval, and continue to be here for you for after-sales support during the life of your solar energy system.
Looking to go solar in New Mexico? Request a proposal from Positive Energy Solar today!