Program Overview
ECP is part of the State’s Sustainable Building Tax Credit Program. This State tax incentive is for homeowners and businesses that install energy efficient products and electrification measures in existing homes and businesses. Qualifying energy conserving products include doors and windows, EV Ready updates, heat pumps, heat pump water heaters, and insulation that meet ENERGY STAR performance values or equivalent performance values for the climate zone in which the products are installed.
Who is eligible?
To qualify, property owners must meet the following criteria:
- Income eligibility: All residents are eligible, but affordable housing and low-income residents are eligible for higher tax credit amounts
- Property Requirement: update to existing residential or commercial (less than 20,000 square feet) building
What is offered?
The program offers state tax credits for qualified ENERGY STAR products and energy efficiency upgrades. You can purchase multiple items at different times with an annual or lifetime maximum of $8,700 available for low-income households and $4,350 available for all other households. The limit is higher for commercial properties in some cases. See table below for additional details.
How Can I Apply?
The deed or property tax bill for the building as well as itemized invoices showing the description of the ECP, cost, quantity, and labor cost will be required. Additional details for each product are included below.
What Tax Credits are offered as part of the ECP Program?
State Tax Credit Caps for Energy Conserving Products
For installation of energy conserving products in affordable and non-affordable existing residential or commercial (less than 20,000 square feet) buildings effective January 1, 2021:
| Product | Affordable Housing and Low Income | Non-Affordable Housing and Non-Low Income |
| Energy Star™ air source heat pump | $2,000 including product and installation costs (per product installed if the applicant is a low-income taxpayer) | $1,000 including product and installation costs per product installed |
| Energy Star™ ground source heat pump | $2,000 including product and installation costs (per product installed if the applicant is a low-income taxpayer) | $1,000 including product and installation costs per product installed |
| Energy Star™ windows and doors | one hundred percent of product and installation costs up to $1,000 (per product installed if the applicant is a low-income taxpayer) | fifty percent of product and installation costs up to $500 per product installed |
| Insulation improvements that meet department’s rules | one hundred percent of product and installation costs up to $2,000 (per product installed if the applicant is a low-income taxpayer) | fifty percent of product and installation costs up to $1,000 per product installed |
| Energy Star™ heat pump water heaters | $700 including product and installation costs (per product installed if the applicant is a low-income taxpayer) | $350 including product and installation costs per product installed |
| Electric vehicle ready | $1,000 including product and installation costs (per product installed if the applicant is a low-income taxpayer), $3,000 for commercial property | $500 including product and installations costs per product installed, $1,500 for commercial property |
Statute – 3.3.35 NMAC 2021 Sustainable Building Tax Credit Personal Income Tax
Statute – 3.4.22 NMAC 2021 Sustainable Building Tax Credit Corporate Income Tax
Required Documents
- Application instructions and checklist
- Proof of Property ownership: A copy of a deed, property tax bill or legal description of the building.
- Itemized invoice that includes:
- Cost of the product and installation labor incurred within the tax year
- Manufacturer and model number
- Product performance ratings (for all products with the exception of insulation)
- Whether the system is ducted or non-ducted (for heat pumps)
- Proof of inspection, if applicable
Other required documents are listed below by product:
- Heat Pumps and Heat Pump Water Heaters
- Heat pump performance specifications, including a specification sheet from the ENERGY STAR website including the full model number.
- A copy/photo of the ENERGY STAR label for the installed model.
- Windows and Doors
- Performance specification values, including:
- A specification sheet from the Energy Star website including the full model number, or;
- Energy Star website equipment specification sheet showing complete model number, or;
- Copy of Energy Star label for specific model installed product.
- Performance specification values, including:
- Insulation
- Material specification sheet showing the R-value or U-value of insulation.
- Material flame spread index and smoke development ratings.
- A certification provided by the contractor showing the installed thickness of insulation following the manufacturer’s installation instructions for blown-in or sprayed-on insulation.
- Electric Vehicle Ready
- A specification sheet for the electric vehicle charging unit showing the service panel upgrade with 40 amperes, and a 208-volt or 240-volt dedicated branch circuit.
- A one-line diagram showing the ampere and voltage rating of the dedicated branch circuit for each charging unit.
- Any additional documents the department requests to review the project.