New Mexico

Number of Sites with CHP: 12

Total Installed Megawatts: 274

Sample Companies and Facilities Using CHP


  • Ciniza Refinery
  • Milagro Cogeneration Plant
  • Orville Slaughter
  • Phelps Dodge Cobre Mining
  • Phelps Dodge Chino Mines Co
  • Phelps Dodge Hidalgo Smelter
  • Williams Field Services Kutz Plant


  • City Of Albuquerque Southside Water Reclamation Plant *renewable
  • New Mexico State University
  • Town Of Taos Coronado Center
  • University Of New Mexico

* Contact Us if you know of additions or subtractions from this list.

New Mexico Policies Affecting CHP

Statewide Interconnection Procedures: Yes

  • Interconnection standards in New Mexico are decent but could be made better by eliminating the requirement for additional insurance. Customers with grid-tied DG systems already carry their own general liability insurance, and the rules already have provisions for indemnification, making the requirement for additional insurance redundant and an extra, unneeded expense. See the policy for 10 MW and under, the policy for more than 10 MW and interconnection manual.
  • About statewide interconnection policies

Waste Heat Included in Renewable Portfolio Standard: Unknown

  • While New Mexico's renewable portfolio standard does not explicitly mention recycled energy, it does contain a provision that allows new technologies to be considered. It is presently unknown if the public service commission would allow a recycled energy project to count. See the policy.
  • About waste heat in renewable portfolio standards

CHP in Utility Demand-Side Management: No

Output-based Emission Standards: No

Fair Standby Rates: Unknown

  • We have not heard direct reports of New Mexico utility standby rates either helping or hurting CHP projects. Neither the legislature nor the public service commission has studied the issue. If you know of standby rates in New Mexico affecting individual projects, contact us.
  • About standby rates

CHP-Specific Incentives: Some

  • Waste heat projects that do not combust additional fossil fuel are eligible for an advanced energy income tax credit of up to 6% of the eligible generating plan costs. See the policy.
  • Tri-State provides power to 44 rural electric cooperatives in parts of NM, CO, WY, and NE. Tri-State offers some incentives for its member cooperatives to develop distributed and/or renewable energy projects, and recycled energy projects qualify. See the Policy Summary, FAQs (part 1) and FAQs (part 2).

Assessment of CHP Conditions in New Mexico

New Mexico Electricity Prices

Average Retail Electricity Prices

Electricity prices in New Mexico have remained fairly low in comparison to the national average over the past five years, staying about a cent and a half per KWh lower for commercial power and about half a cent lower for industrial power. The power prices have stayed fairly consistent with very little volatility over the five year time period. Overall, New Mexico falls in the middle of the southwest states in respect to electricity prices.

New Mexico average commercial retail electricity price (2010) 8.67 ¢/kWh
National average commercial retail electricity price (2010) 10.26 ¢/kWh
New Mexico average industrial retail electricity price (2010) 6.00 ¢/kWh
National average industrial retail electricity price (2010) 6.79 ¢/kWh

Source: EIA; data is year-to-date through December 2010.
Note: All data post January 2010 are preliminary estimates based on a cutoff model sample.

New Mexico Natural Gas Prices

Average Retail Natural Gas Prices

Natural gas prices in New Mexico have stayed fairly close to the national average in terms of volatility, while remaining, on average, more than a dollar cheaper than the national average(per thousand cubic feet or TCF) for commercial customers, but about a half a dollar more expensive than the national average for industrial customers. This puts New Mexico in the middle of the southwest states ranking as far as both price and volatility are concerned.

When evaluating CHP, a considerable amount of attention needs to be placed on the price of natural gas, and where it may be headed in the future. The combination of relatively low electric prices and rising natural gas prices makes it more difficult for a CHP project to be economic and generate cost savings, but there are still going to be successful applications for the appropriate use of CHP. The best applications are those that value high reliability, have higher electric rates during peak times, spend a high percentage of their energy bill on air conditioning, and/or potentially could make use of a "waste fuel."

New Mexico average commercial natural gas price (2010) 7.55 $/TCF
National average commercial natural gas price (2010) 9.23 $/TCF
New Mexico average industrial natural gas price (2010) 6.05 $/TCF
National average industrial natural gas price (2010) 5.34 $/TCF

Source: EIA; data is year-to-date through December 2010.

Key New Mexico Contacts

Wyoming Utah Colorado Arizona New Mexico Oklahoma Texas

** Click on a state to learn more about the
status of CHP in that state