New Mexico Laws and Incentives for Ethanol

The list below contains summaries of all New Mexico laws and incentives related to Ethanol.

State Incentives

Biofuels Production Tax Deduction

The cost of purchasing qualified biomass feedstocks to be processed into biofuels, as well as the associated equipment, may be deducted in computing the compensating tax due under the New Mexico Gross Receipts and Compensating Tax Act. For the purpose of this incentive, biofuels include ethanol, methanol, methane, and hydrogen. (Reference New Mexico Statutes 7-9-98)

Alternative Fuel Vehicle (AFV) and Fueling Infrastructure Grants

The New Mexico Energy, Minerals, and Natural Resources Department administers the Clean Energy Grants Program, which provides grants for projects using clean energy technologies, including alternative fuel vehicles and fueling infrastructure, as well as 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. As of March 2013, funding for this program is unavailable. (Reference New Mexico Statutes 71-7)

Alternative Fuel Tax Exemption

Alternative fuel distributed by or used for U.S. government; state government; or Indian nation, tribe, or pueblo purposes; is exempt from the state excise tax. (Reference New Mexico Statutes 7-16B-5)

Laws and Regulations

Green Jobs Training Program

Under the Green Jobs Act, the New Mexico Higher Education Department must develop a state research program in partnership with the Workforce Solutions Department to collect labor market data for renewable energy industries. The New Mexico Green Jobs Portal was created to support job seekers through education and career development resources and the New Mexico Department of Finance and Administration administers a green jobs fund to support the programs. (Reference New Mexico Statutes 9-15D)

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. Vehicles must meet or exceed the federal corporate average fuel economy standards. Certified law enforcement pursuit vehicles and emergency vehicles are exempt from this requirement. The New Mexico Energy, Minerals and Natural Resources Department may grant additional exemptions based on the availability and suitability of vehicles, as well as fuel availability and cost.

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 per 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)

Alternative Fuel 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 (or propane), compressed natural gas, and liquefied natural gas. Alternative fuel purchased for distribution is not subject to the 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. Alternative fuel distributors must be licensed by the state. In lieu of the per gallon tax, owners of alternative fuel vehicles with a gross vehicle weight rating (GVWR) not exceeding 54,000 pounds (lbs.) may pay an annual tax as follows:

For tax forms and instructions, refer to the New Mexico Taxation and Revenue Department website.

(Reference New Mexico Statutes 7-16B)