New Mexico Solar Panel Costs in 2022
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How much you can save on your New Mexico solar array depends on the price of the equipment and the needed system size. Considering the following factors will help you determine if a higher price tag is worth it and if now is the right time to add residential solar to your home.
The Average System Size in New Mexico
According to electricity local, the average New Mexico homeowner consumes 656 kWh per month. This usage is equivalent to about a 5 kW system. However, each home is different. Make sure your system meets the needs of your home.
Average NM Solar Panel Price by System Size
According to Energy Sage, New Mexico solar panel installs range between $9,450 and $31,500 before the federal solar tax credit. This price range depends on the size of the array. A 3kW system produces between 260 – 415 kWhs a month, which doesn’t cover most homes’ energy needs. On the other hand, a 10 kW system can generate between 870 and 1380 kWh a month.
Determining Your Energy Usage
Each home is different, making it imperative to determine how much electricity your home uses in a year. Your yearly usage will help the solar company size your solar array. To find your annual energy use, you need to find the sum of your electricity usage over the past year. Most electricity companies provide this information on their monthly statements. You can also call and ask for your monthly energy usage over the past year. Month-to-month numbers are better than an annual total because it shows the difference in electricity consumption over the year. Knowing monthly consumption and understanding how solar panels work will help you understand why your solar array overproduces some months and relies on net metering credits or battery backup to meet your energy needs in other months.
Factors that Go Into New Mexico’s Solar Panel Savings
Many factors go into solar panel savings. Discovering what these aspects of solar savings look like will help you understand if residential solar is the right choice for your New Mexico home.
The out-of-pocket cost for solar is a little higher than what you will end up spending because the ITC is a tax credit given after purchasing the array. Energy Sage estimates the out-of-pocket cost for New Mexico 5kW solar installations ranges between $14,875 and $20,125.
Impact Financing Options Make on Solar Savings
The main financing options include cash, loan, and lease. While cash is the best option, most people can’t pay cash for their array. While loans have interest, they are the best option if you can’t pay in cash because they give ownership of the array to the homeowner and save them more money than a lease would long term. Leased solar arrays, often advertised as no-cost solar, allow homeowners to pay less per month. However, they also lock them into a lease agreement that could prove hard to get out of if they need to move before the solar lease is over. How you decide to finance your solar array has a huge impact on the savings and payback period of your system.
Net 20-year Solar Savings
The net 20-year savings for a 5kW New Mexico system ranges between $24,607 – $33,292. This number comes from the savings after subtracting the out-of-pocket cost of the array.
Pay-back Period for New Mexico Solar
When you break even on your solar investment depends on the payment plan you choose and whether you decide to make minimum or additional payments. However, on average, the payback period for New Mexico residential solar ranges between 7.9 and 10.7 years. After considering the typically 25-year solar panel warranty with 40 plus years of potential use, this payback period is short compared to the array’s projected life.
Electricity Bill Offset
The electricity bill offset is the amount of electricity your solar array covers. While ideally, solar homes should have at least 100 percent offset, this doesn’t always happen. The offset in New Mexico is typically between 83 – 112 percent. This range in production depends on the available space, the home’s energy needs, the local utility’s solar generation caps, and the homeowner’s budget.
Should You Purchase Solar For Your New Mexico Home?
As indicated above, solar will save New Mexico residents money. However, whether you should purchase solar for your New Mexico home depends on whether your home qualifies for solar and the timing.
Qualifying for Solar
To qualify for solar, you need to have enough usable space for a solar array. This space can be either unshaded land or a roof. If you decide to add solar on top of your home, you also need to make sure that the roof isn’t too old and that the house can support the added weight of a solar array. If your home meets these standards, you need to determine if you can qualify for financing and which financing program you want to use.
Timing Your Solar Installation
Sometimes the timing isn’t right. You may need to wait until your credit score is a bit higher or until you have updated your roof before installing solar. If you don’t have roadblocks, it’s best to get solar sooner because the ITC is phasing down.
Should You Wait for Solar Technology to Advance
The longer you wait to get solar, the less you will save because you will have missed out on the savings that solar could have provided during that period. Technology shouldn’t be a reason to wait on solar. Getting solar now will help you save now. Waiting for technology to improve could take decades.