New Mexico Hydrogen Laws and Incentives

State Incentives

Alternative Fuel Vehicle (AFV) Manufacturing Tax Credit

The Alternative Energy Product Manufacturers Tax Credit provides a credit against combined reporting taxes (gross receipts, compensating, and withholding) for manufacturing alternative energy products, which include hydrogen and fuel cell vehicle systems, and electric and hybrid electric vehicles. The credit is limited to 5% of qualifying expenditures, and manufacturers must fulfill job creation requirements to be eligible. (Reference New Mexico Statutes 7-9J)

Biofuels Tax Deduction

The cost of biomass materials used for processing into biofuels, biopower, or bio-based products may be deducted in computing the compensating tax due under the Gross Receipts and Compensating Tax Act. Biofuels include biomass converted to liquid or gaseous fuels such as ethanol, methanol, methane, and hydrogen. (Reference New Mexico Statutes 7-9-98)

Alternative Fuel Vehicle (AFV) and Fueling Infrastructure Grants

The Clean Energy Grants Program is administered by the Energy Conservation and Management Division of the New Mexico Energy, Minerals, and Natural Resources Department and provides grants for projects utilizing clean energy technologies (including alternative fuel vehicles and fueling infrastructure) and projects that provide clean energy education, technical assistance, and training programs. These grants are provided on a competitive basis to qualifying entities such as municipalities and county governments, state agencies, state universities, public schools, post-secondary educational institutions, and Indian nations, tribes, and pueblos. (Reference New Mexico Statutes 71-7-1 to 71-7-7)

State Laws and Regulations

Alternative Fuel Vehicle (AFV) and Hybrid Electric Vehicle (HEV) Acquisition Requirements

A minimum of 75% of state government and educational institution fleet vehicles purchased must be HEVs or bi-fuel or dedicated AFVs, which includes plug-in electric vehicles. Vehicles must meet or exceed the corporate average fuel economy standards issued by the National Highway Transportation Safety Administration of the U.S. Department of Transportation. Certified law enforcement pursuit vehicles and emergency vehicles are exempt from this requirement. (Reference Senate Bill 450, 2009, and New Mexico Statutes 13-1B-3)

Alternative Fuel Vehicle (AFV) Acquisition Loans

Up to $5 million is authorized for a revolving loan fund for AFV acquisitions by state agencies, political subdivisions, and educational institutions. The maximum amount of a loan to acquire a vehicle must not exceed the actual cost of acquiring the vehicle or $3,000, whichever is less. Projected fuel cost savings from using the AFV is considered when the loan repayment schedule is developed. (Reference New Mexico Statutes 13-1B)

Hydrogen and Fuel Cell Development

The New Mexico Department of Economy Development is directed to establish the Hydrogen and Fuel Cell Technologies Development Program to foster the development of hydrogen and fuel cell-related commercialization and economic development in the state. The program will establish a public-private partnership to provide guidance and support for hydrogen and fuel cell initiatives; support the adoption of uniform hydrogen safety codes and standards and provide education and training to communicate these codes and standards to the appropriate fire and regulatory entities; develop demonstration projects by pursuing federal funds and other available funds to augment state resources, advance public education about hydrogen and fuel cell technology, and build the necessary infrastructure to support commercial use and adoption of hydrogen and fuel cell technologies; and coordinate research and education activities related to hydrogen and fuel cell technologies to promote closer cooperation and advance the state's overall capabilities and programs in hydrogen and fuel cell technologies. (Reference New Mexico Statutes 71-7-7)

Alternative Fuels Definition

The definition of an alternative fuel includes natural gas, liquefied petroleum gas, electricity, hydrogen, fuel mixtures containing not less than 85% ethanol or methanol, and fuel mixtures containing not less than 20% vegetable oil, or a water-phased hydrocarbon fuel emulsion in an amount not less than 20% by volume. Biodiesel is defined as a renewable, biodegradable, mono alkyl ester combustible liquid fuel that is derived from agricultural plant oils or animal fats and meets current ASTM biodiesel standards. (Reference New Mexico Statutes 13-1B-2 and 57-19-27)

Alternative Fuels Tax

The excise tax imposed on an alternative fuel distributed in New Mexico is $0.12 per gallon. Alternative fuels subject to the excise tax include liquefied petroleum gas, compressed natural gas, and liquefied natural gas. Alternative fuel purchased for distribution is not subject to the alternative fuel excise tax at the time of purchase or acquisition, but the tax is due on any alternative fuel at the time it is dispensed or delivered into the tank of a motor vehicle. Owners of alternative fuel vehicles with a Gross Vehicle Weight Rating (GVWR) not exceeding 54,000 pounds (lbs.) may pay an annual tax in lieu of the per gallon tax, according to the following schedule:

Alternative fuel distributed by or used for U.S. government, state government, or an Indian nation, tribe or pueblo purposes, is exempt from the excise tax. Alternative fuel distributors must be licensed by the state. (Reference New Mexico Statutes 7-16B)

Alternative Fuel Vehicle (AFV) Acquisition Requirements - Albuquerque

All motor vehicles purchased by the City of Albuquerque must be dedicated, flexible fuel, or dual-fuel AFVs. Alternative fuels are defined as fuels other than gasoline and 100% petroleum diesel and may include ethanol, biodiesel, natural gas, electricity, propane, or other alternative fuels approved by the city's Chief Administrative Officer. (Reference City of Albuquerque Executive Order 19, 2006)