Local Solar Access applications expected to open early next year

Under draft rule, 60% of the money must benefit rural communities
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​By AUSTIN FISHER
Courtesy of Source NM

Local and tribal governments in New Mexico can expect to begin applying for state funding to support solar energy projects early next year, if not sooner, state officials told lawmakers on Wednesday.

At the New Mexico Finance Authority Oversight Committee’s meeting in Deming, NMFA Deputy Director Fernando Martinez said applications for the newly created Local Solar Access Fund will open in early 2026, but the agency is hoping to have them ready by December.

The fund is a $20 million pot of public money for grants for solar energy and battery storage for tribal, rural and low-income schools, municipalities, counties, land grant communities and New Mexico’s seven regional Councils of Governments.

The projects supported by the fund are meant to reduce energy costs for low-income households and community service providers; support the local renewable energy workforce; enhance community resilience during emergencies; and leverage other funding sources, according to Martinez’s presentation to the committee.

The new law requires NMFA to provide project grants for designing and building solar systems, and help developers obtain state and local permits or apply for federal or other funding sources, the presentation states.

“We’ll be in the meantime building the applications internally so that we have a really good system so that when we open it up, it’s a really straightforward process, and we have a really good client experience for them, so it’s not too difficult,” Martinez said.

An advance copy of the proposed rule for funding decisions given to the committee on Wednesday also requires NMFA to work with the state Energy, Minerals, & Natural Resources Department to create minimum standards for proposed systems and metrics for applicants. Those metrics include capacity for the scope of work; project location; how much a project will contribute to a community’s “resilience;” and any other benefits that may result.

The new law requires most of the funding to benefit rural communities. The proposed rule specifies at least 60% of the money, approximately $10.8 million, be allocated to rural communities with a total county population of 60,000 or fewer people. No more than 25% of the money can go to any one county, the rule states, including the county government itself.

Half of New Mexico’s population lives in the 30 more rural counties, Rep. Kathleen Cates (D-Rio Rancho) told the committee, while the other half lives in Bernalillo, Santa Fe and Doña Ana counties.

“We don’t want to forget about either 50% of the population,” Cates said. “I appreciate that the drafters of this bill understand that rural communities are at a disadvantage and are giving them more than 50% of the opportunity for this program.”

The proposed rule sets a $16 million limit total for project grants and $2 million for technical assistance, leaving $2 million for NMFA to administer the program and cover any unexpected costs, NMFA spokesperson Lynn Taulbee told Source NM.

New Mexico’s implementation of new solar funding law comes as the federal government reverses the prior administration’s moves to boost renewable energy production.

A law signed by President Joe Biden in 2022 gave developers tax and energy production credits for wind and solar projects, but President Donald Trump’s “One Big Beautiful Bill Act” abruptly ended those credits in July.

Then in August, the Trump administration clawed back $7 billion in grants for solar energy projects for low-income households from the same Biden-era law that would have benefitted 60 recipients, including EMNRD.
New Mexico also has a different programfor businesses and low-income households to receive energy from solar farms.

​During the presentation, NMFA CEO Marquita Russel noted that both the NMFA and the legislative oversight committee will need to approve the Local Solar Access Fund’s rules by November. Once initially approved, the committee will have to sign off on any future changes, she said.