Is Electrification Worth It in New Mexico?

New Mexico: 4,500 heating degree days in Albuquerque, 320 sunny days per year, and cheap gas.

Natural gas costs $0.80/therm—some of the cheapest in the nation. Electricity runs $0.13/kWh. You need moderate heating and AC for hot summers. PNM offers solar rebates, and New Mexico has a 10% solar tax credit (capped at $6,000).

The heat pump math is tough here because gas is so cheap. Unless you're replacing both systems or heating with propane, stick with gas for heating and get efficient AC for cooling. BUT—solar is a slam dunk. 320 sunny days + good net metering + state + federal incentives = 5-7 year payback. Do that instead.

Updated December 2024•Data from EIA, DSIRE, NREL
Heat Pump Payback
Not Recommended
With incentives
Annual Savings
$2,192
Full electrification
Available Incentives
$10,700
Federal + state + utility
CO₂ Reduction
12.8 tons
Per year

New Mexico Energy Costs

Electricity Rate
$0.138/kWh
Natural Gas Rate
$1.22/therm
Average Electric Bill
$135/month
Average Gas Bill
$58/month
Climate Zone
mixed
Heating Degree Days
4,200
Cooling Degree Days
1,450
Share:

Visual ROI Analysis

Payback Period Comparison

Lower is better • Shortest payback = fastest return on investment

Annual Savings Comparison

Higher is better • More annual savings = greater long-term benefit

Cumulative Net Savings Over Time

Point where line crosses $0 = payback achieved • Steeper line = faster savings growth

Return on Investment by Upgrade

🌡️

Heat Pump HVAC

Upfront Cost$12,000 - $22,000
Total Incentives-$2,500
Net Cost$9,500 - $19,500
Annual Savings$-64/yr
Payback PeriodNot Recommended
Lifetime ROI0%
CO₂ Reduction2.9 tons/yr
☀️

Solar Panels

Upfront Cost$15,000 - $30,000
Total Incentives-$4,500
Net Cost$10,500 - $21,000
Annual Savings$969/yr
Payback Period17.1 years
Lifetime ROI126%
CO₂ Reduction3.3 tons/yr
💧

Heat Pump Water Heater

Upfront Cost$2,500 - $4,500
Total Incentives-$2,400
Net Cost$100 - $2,100
Annual Savings$159/yr
Payback Period9.9 years
Lifetime ROI54%
CO₂ Reduction1.8 tons/yr
⚡

EV Charger + Electric Vehicle

Upfront Cost$800 - $2,500
Total Incentives-$1,300
Net Cost$-500 - $1,200
Annual Savings$1,128/yr
Payback Period0.4 years
Lifetime ROI1460%
CO₂ Reduction4.8 tons/yr

Full Electrification Package

Total Upfront Cost
$30,300 - $59,000
Total Incentives
-$10,700
Net Cost After Incentives
$19,600 - $48,300
Annual Energy Savings
$2,192/year
Lifetime Savings (18 years)
$39,453
Simple Payback
17.6 years
💡

Best ROI for New Mexico

Based on your state's energy costs and climate, EV Charger offers the best return on investment with an average payback of 0.4 years and an ROI of 1460%.

0.0 years slower than average compared to the national average.

Ready to electrify your New Mexico home?

Get free quotes from local contractors who specialize in heat pumps, solar, and electrification.

Get Free Quotes →