The bill amends existing laws concerning tax credits for geothermal energy production in New Mexico, renaming the "Geothermal Electricity Generation Income and Corporate Income Tax Credits" to the "Geothermal Energy Production Income and Corporate Income Tax Credits." It establishes a new tax credit schedule based on the amount of geothermal energy produced, with specific rates per kilowatt-hour for the first ten taxable years of production. The bill caps the total amount of credits that can be claimed for a single geothermal energy production facility at the first two hundred thousand megawatt-hours produced. Additionally, it increases the total annual aggregate amount of credits that can be certified from five million dollars to fifty-five million dollars, with a portion reserved for tribal and small businesses.

The bill also introduces provisions for the transfer of eligibility certificates for the tax credits between taxpayers and mandates that these certificates be provided electronically by the energy, minerals, and natural resources department. It allows for the sale, exchange, or transfer of the eligibility certificate for its full value, requiring notification to the department within ten days of such transactions. The definition of the tax credit is modified to encompass geothermal energy production rather than just electricity generation, and any portion of the credit exceeding a taxpayer's tax liability cannot be refunded but may be carried forward for up to three consecutive years. New definitions related to geothermal energy production facilities, geothermal resources, and the terms "small business" and "tribal business" are also included, with the provisions applicable to taxable years beginning on or after January 1, 2026.

Statutes affected:
introduced version: 7-2-18.38, 7-2A-24.1