New Mexico 2025 Regular Session

New Mexico Senate Bill SB418 Compare Versions

Only one version of the bill is available at this time.

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28	28	SENATE BILL 418
29	29	57
30	30	TH LEGISLATURE
31	31	-
32	32
33	33	STATE
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35	35	OF
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37	37	NEW
38	38
39	39	MEXICO
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41	41	-
42	42	FIRST SESSION
43	43	,
44	44
45	45	2025
46	46	INTRODUCED BY
47	47	Michael Padilla
48	48	AN ACT
49	49	RELATING TO PUBLIC UTILITIES; PERMITTING THE GENERATION AND
50	50	DISTRIBUTION OF SELF-SOURCED POWER; CREATING THE QUALIFIED
51	51	MICROGRID INCOME TAX CREDIT.
52	52	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
53	53	SECTION 1. A new section of Chapter 62 NMSA 1978 is
54	54	enacted to read:
55	55	"[NEW MATERIAL] SELF-SOURCED POWER GENERATION.--
56	56	A. Persons and entities located within the state
57	57	may receive electricity service using a qualified microgrid
58	58	that may also deliver electricity to equipment, lines and
59	59	facilities operated by a public utility or a distribution
60	60	cooperative; provided that the person or entity and the public
61	61	utility or distribution cooperative enter into an electric
62	62	service agreement.
63	63	.230319.2 underscored material = new
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90	90	B. Nothing in this section shall prevent a public
91	91	utility or distribution cooperative from acquiring self-source
92	92	generation resources and dedicating those resources to retail
93	93	services, wholesale services or self-generation services, or
94	94	any combination of those services, and rates established for
95	95	those services shall take into account the public interest and
96	96	need, reliability and affordability.
97	97	C. Energy generated and sold from a self-source
98	98	generation resource built to serve in whole or in part a
99	99	qualified microgrid shall not be considered retail sales as
100	100	contemplated under Sections 62-15-34 and 62-16-4 NMSA 1978,
101	101	whether serving the qualified microgrid or purchased in part by
102	102	the utility.
103	103	D. A person who only provides self-source
104	104	generation sales from a self-source generation resource shall
105	105	not be considered a public utility or a distribution
106	106	cooperative.
107	107	E. As used in this section:
108	108	(1) "qualified microgrid" means a permanent or
109	109	temporary electrical system that:
110	110	(a) incorporates a microgrid controller;
111	111	(b) includes a self-source generation
112	112	resource that is capable of generating not less than twenty
113	113	megawatts; and
114	114	(c) is capable of operating
115	115	.230319.2
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143	143	independently and disconnected from the grid;
144	144	(2) "self-source generation resource" means a
145	145	permanent or temporary electricity generating resource that is
146	146	dedicated to primarily serving the persons connected either
147	147	directly or indirectly through affiliates to the construction
148	148	and installation of a qualified microgrid; and
149	149	(3) "self-source generation sales" means sales
150	150	of electricity to persons or utilities generated from a self-
151	151	source generation resource."
152	152	SECTION 2. A new section of the Income Tax Act is enacted
153	153	to read:
154	154	"[NEW MATERIAL] CREDIT--QUALIFIED MICROGRID INCOME TAX
155	155	CREDIT.--
156	156	A. A taxpayer who is not a dependent of another
157	157	individual and who constructs and installs a qualified
158	158	microgrid in an underserved community in New Mexico prior to
159	159	January 1, 2031 may claim a credit against the taxpayer's tax
160	160	liability imposed pursuant to the Income Tax Act; provided that
161	161	a taxpayer shall not be eligible to claim the credit if the
162	162	taxpayer is allowed a credit for any of the costs for which a
163	163	credit is allowed pursuant to another section of the Income Tax
164	164	Act. The credit authorized pursuant to this section may be
165	165	referred to as the "qualified microgrid income tax credit".
166	166	B. The amount of the tax credit shall be in an
167	167	amount equal to the costs to construct and install the
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196	196	qualified microgrid, not to exceed one hundred thousand dollars
197	197	($100,000) per qualified microgrid constructed and installed.
198	198	C. A taxpayer shall apply for certification of
199	199	eligibility for the tax credit from the energy, minerals and
200	200	natural resources department on forms and in the manner
201	201	prescribed by that department within twelve months following
202	202	the calendar year in which the qualified microgrid is
203	203	installed. Except as provided in Subsections G and H of this
204	204	section, only one tax credit shall be certified per taxpayer
205	205	per taxable year. If the energy, minerals and natural
206	206	resources department determines that the taxpayer meets the
207	207	requirements of this section, that department shall issue a
208	208	dated certificate of eligibility to the taxpayer providing the
209	209	amount of tax credit for which the taxpayer is eligible and the
210	210	taxable years in which the credit may be claimed. The energy,
211	211	minerals and natural resources department may promulgate rules
212	212	governing the procedure for administering the provisions of
213	213	this subsection. The energy, minerals and natural resources
214	214	department shall provide the department with the certificates
215	215	of eligibility issued pursuant to this subsection in an
216	216	electronic format at regularly agreed upon intervals.
217	217	D. Applications for certification of the credit
218	218	shall be made no later than one year from the date on which the
219	219	qualified microgrid is installed.
220	220	E. A certificate of eligibility for the credit may
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249	249	be sold, exchanged or otherwise transferred to another taxpayer
250	250	for the full value of the credit. The parties to such a
251	251	transaction shall notify the department of the sale, exchange
252	252	or transfer within ten days of the sale, exchange or transfer
253	253	in an electronic format prescribed by the department.
254	254	F. That portion of the tax credit that exceeds a
255	255	taxpayer's income tax liability in the taxable year in which
256	256	the credit is claimed may be carried forward for twenty
257	257	consecutive taxable years until the amount is exhausted.
258	258	G. Married individuals filing separate returns for
259	259	a taxable year for which they could have filed a joint return
260	260	may each claim only one-half of the tax credit that would have
261	261	been claimed on a joint return.
262	262	H. A taxpayer may be allocated the right to claim a
263	263	qualified microgrid income tax credit in proportion to the
264	264	taxpayer's ownership interest if the taxpayer owns an interest
265	265	in a business entity that is taxed for federal income tax
266	266	purposes as a partnership or limited liability company and that
267	267	business entity has met all of the requirements to be eligible
268	268	for the credit. The total credit claimed by all members of the
269	269	partnership or limited liability company shall not exceed the
270	270	allowable credit pursuant to this section.
271	271	I. A taxpayer allowed to claim a tax credit
272	272	pursuant to this section shall claim the tax credit in a manner
273	273	required by the department. The credit shall be claimed within
274	274	.230319.2
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302	302	one taxable year of the end of the year in which the energy,
303	303	minerals and natural resources department certifies the credit.
304	304	J. The credit provided by this section shall be
305	305	included in the tax expenditure budget pursuant to Section
306	306	7-1-84 NMSA 1978, including the total annual aggregate cost of
307	307	the credit.
308	308	K. As used in this section:
309	309	(1) "qualified microgrid" means a permanent or
310	310	temporary electrical system that:
311	311	(a) incorporates a microgrid controller;
312	312	(b) includes a self-source generation
313	313	resource that is capable of generating not less than twenty
314	314	megawatts; and
315	315	(c) is capable of operating
316	316	independently and disconnected from the grid;
317	317	(2) "self-source generation resource" means a
318	318	permanent or temporary electricity generating resource that is
319	319	dedicated to primarily serving the persons connected either
320	320	directly or indirectly through affiliates to the construction
321	321	and installation of a qualified microgrid; and
322	322	(3) "underserved community" means an area in
323	323	the state, including a county, municipality or neighborhood, or
324	324	a subset of such an area, where the median income of the area
325	325	is at or near the federal poverty level."
326	326	SECTION 3. APPLICABILITY.--The provisions of Section 2 of
327	327	.230319.2
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355	355	this act apply to taxable years beginning on or after January
356	356	1, 2025.
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358	358	.230319.2