With the launch of a new state program, income-eligible New Mexicans can now apply for federal rebates to aid in making certain energy-saving home improvement projects more affordable.
The state received $43 million from the US Department of Energy for its Home Electrification and Appliance Rebates (HEAR) program, which state officials launched Sept. 3. HEAR offers up to $14,000 per address in rebates for energy-efficient home upgrades. Eligible households must earn less than 80% of the county of residence’s Area Median Income and must own and live in a single-family home, duplex, triplex, quadplex or townhome. For a four-person family in Santa Fe County, that income amount translates to earning no more than $73,200.
Eligible households must earn less than 80% of Santa Fe County’s Area Median Income and must own and live in a single-family home, duplex, triplex, quadplex or townhome. (SOURCE: Housing and Urban developement)
State Energy Conservation and Management Director Rebecca Stair tells SFR the need for programs like these is “really great.” New Mexico’s 17.6% poverty rate is 56% higher than the national average of 11.5% and marks the highest unadjusted poverty rate in the nation, according to a 2023 progress report from the New Mexico Legislature’s Legislative Finance Committee.
“That also means that in New Mexico, a disproportionate amount of our population has what’s called a high energy burden, meaning a very high percentage of their monthly income is spent on heating and cooling and electricity,” Stair says. “Typically, what is considered a reasonable energy burden is below 10% of your income, and in New Mexico, we’re seeing folks who pay in the teens and sometimes 20% or even 30% of their monthly income just to stay warm in the winter, and that’s a real equity issue. We’re really excited about the potential of this program to free up some income and make New Mexicans more comfortable.”
President Joe Biden signed the Inflation Reduction Act, which provides nearly $400 billion to support clean energy and address climate change, in August 2022. The act dedicated roughly $8.8 billion of that for home energy rebates, for which New Mexico was the first state to apply.
Eligible uses of HEAR program dollars include purchasing select appliances; insulation, air sealing and ventilation; heating and cooling; and electric upgrades. State officials opened the first wave of applications for wall, ceiling/attic, floor and foundation insulation, with other categories’ applications to open soon. Stair says, as of Sept. 5, officials have received 49 applications and issued eight rebates.
Advocates from clean energy organizations say efforts are well placed. Advanced Energy United Senior Principal Michael Barrio, who oversees engagement and policy work in New Mexico and Arizona, tells SFR apart from energy bills savings, local economies could see the benefit in the form of job creation as well.
“These kinds of investments really always tend to create jobs in construction, HVAC, electric electrical work, and all those things really benefit local economies, especially economies like New Mexico,” Barrio says. “I think by focusing on disadvantaged communities, these programs provide opportunities for economic development where it’s really most needed.”
The DOE estimates the rebates will save households up to $1 billion annually on energy bills, as well as support over 50,000 jobs nationally.
Barrio says the state’s focus on energy efficiency is especially important due to its reliance on fossil fuels, which he believes state leadership should aim to reduce.
“I think it’s important that we think about this in New Mexico, because the energy transition is something that’s going to happen, whether we like it or not. It literally is the future of energy, and at some point, we’re going to have to switch over entirely to renewable energy sources,” he says. “We know that oil and gas is a finite resource, but a state like New Mexico that has historically been so reliant on oil and gas at the Permian Basin, this is something that I think we really need to focus on in our broader efforts. We have a very critical vested interest in looking into how we plan for and develop our energy infrastructure and resources.”
Furthermore, gas prices are expected to rise both in New Mexico and nationally as the focus toward clean energy continues, meaning “the only way to deal with it is to think about helping proactively plan” around energy infrastructure and “transition the most vulnerable folks off the system first,” Barrio adds.
Stair notes more money for additional programs is “in the pipeline.” State officials will use an additional $43 million for an upcoming Home Efficiency Rebates (HER) program, which “offers similar discounts” for New Mexico residents, she says.
“[The HER program] takes a different approach, where it’s a whole of home approach, saying, ‘OK, if you can take your whole home and a contractor can make it 10% or 20% or 30% more efficient, then you get this many dollars off of whatever measures are needed to make it more efficient,’” Stair says.
She anticipates the additional program will launch this quarter, along with energy coaches that will act as the “personal energy concierge” for interested households to help navigate the program and desired home energy improvements.
“I just want to encourage everyone to begin this journey of efficiency and comfort in our home regardless of your income level. There is something for everybody, so even if you don’t qualify for this program, don’t be discouraged,” Stair says. “There’s lots of options for folks to make their homes more comfortable and more affordable.”
The program will remain active for four years. To learn more, visit clean.energy.nm.gov.
