New Mexico Passes Laws to Promote Clean Energy and Hybrid Cars

March 10, 2004

New Mexico Governor Bill Richardson signed three energy bills into law on March 4th, including a "Renewable Energy Act" that sets minimum requirements for renewable energy use by the state's public utilities. Governor Richardson also signed a bill for the state to invest in hydrogen and other cutting-edge energy sources, and to provide "clean energy grants" to state agencies and local governments; public schools and other educational institutions; and tribal entities. The third bill exempts from excise taxes any purchase of a new hybrid-electric car that achieves a fuel economy rating of at least 27.5 miles per gallon. See the governor's press release (PDF 131 KB). Download Acrobat Reader.

The state's new "Renewable Energy Act" requires public utilities to draw on renewable energy resources for 5 percent of the electricity they sell starting in 2006, increasing by 1 percent each year until 2011, when the renewable requirement will hold steady at 10 percent of retail sales. The utilities can meet their renewable energy requirement using solar, wind, hydropower, geothermal, and select biomass energy resources, as well as by using fuel cells powered with something other than fossil fuels. However, the law allows the New Mexico Public Service Commission to set a "reasonable cost threshold" for renewable energy, and allows utilities to fall short of their requirements if meeting them would result in exceeding the cost threshold. The law also allows the Commission to give utilities extra credit for using some types of renewable energy, and allows the Commission to reduce the renewable energy requirement for commercial and industrial customers. The law codifies rules established by the Commission in late 2002. See the New Mexico Legislature Web site for the full text of Senate Bill 43, House Bill 251, and Senate Bill 86, and for background on the Commission's 2002 rules, see the article from the January 8th, 2003, edition of the EERE Network News.