Alabama ranks #51 in America for savings from installing solar panels on your home

Solar power in Alabama

Last fact checked on August 01, 2019 by Catherine Lane

There is some room for improvement when it comes to solar power in Alabama. There are no state-based incentives and there is no net metering policy in place. Also, there is no renewable portfolio standard, which is often what pushes utilities to create solar rebates for customers. 

Despite the lack of incentives, Alabama receives plenty of sunlight, so a solar system here will produce more electricity than a system in other areas of the country. 

Residents of the Heart of Dixie can also take advantage of the 30% federal tax credit.


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Solar power in Alabama

Alabama solar power facts


Average cost of a 5kw solar power system in 2020
Price shown before incentives

9 Years 3 Months

Average payback time


Average lifetime savings
Price shown after repayments of capital


levelized cost of solar energy


If you don't get solar
The forecast average utility price over the next 25 years


Annual power production

Cash flow graph based on cash purchase of a 12.15kW system

This 12.15kW system would offset 100% of your energy usage if your typical monthly bill in Alabama is $154, however your situation may vary so try our solar calculator to get a result tailored to you.

Best solar offers currently available in Alabama

Solar calculator and quote comparison tool

Compare solar quotes from the top solar companies in Alabama

How much do solar panels cost in Alabama

$2.69 per watt

Cash purchased solar system
Before 26% solar tax credit

$3.04 per watt

Financed solar system
Before 26% solar tax credit

N/A cents/kWh

Av. 15 year term, 2.5% price escalator

What are the pros and cons of buying solar panels for your home in Alabama

The advantage of installing solar panels in Alabama is that the state receives excellent sunshine, so a solar system here will produce a lot of energy. Depending on where they live, Alabama homeowners may also be able to take advantage of the Tennessee Valley Authority Green Power Providers Program. 

SolarPowerRocks provides a great breakdown of solar incentives and policy for each state within the US.

The disadvantage of installing solar panels in Alabama is that there is hardly any policy or legislation regarding solar power, so there is a lack of incentives and rebates for installing solar. There is no net metering policy, so utilities are not required to compensate customers for excess electricity their solar system produces. The state’s only investor-owned utility, Alabama Power Company, does provide compensation for surplus energy a solar system produces, but solar customers also must pay a fee for having solar. 

However, because of the 30% federal tax credit, now is the best time to go solar in Alabama. 

Enter your details to calculate the cost and savings you are likely to get from installing solar panels for your home.


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Best brands of solar panels

To find the best brands of solar panels you can use America's most trusted solar panel comparison and reviews website, SolarReviews.

However, reviews of solar panels can be a bit meaningless because most consumer owners have not had any issues and so while solar company reviews are very important when choosing solar installers they are of less use when choosing solar panels.

For more information to help you make an informed decision about this topic, I would recommend this article about buying solar panels.


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How much electricity will solar panels produce in Alabama

Solar panels produce different amounts of energy in different locations.

Around the Montgomery area solar panels installed on a south facing 30 degree pitch roof will typically produce:

1,441kWh per year per 1kw of peak DC (direct current) capacity

For more information about how your location, roof direction and roof tilt affects solar power production use the solar panels calculator and enter your zipcode below.


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I want to buy a solar panel kit and install it myself

What rebates, solar tax credits, and other solar incentives are available in Alabama?

Tennessee Valley Authority Green Power Providers program

Tennessee Valley Authority (TVA) teamed up with a select few local power companies to provide incentives for homeowners who go solar through the Green Power Providers program. Customers install a solar energy system on their home and TVA pays 9 cents for every kilowatt hour of energy generated, provided the system is 10 kilowatts (kW) or less in size. Through this contract, TVA receives all renewable energy credits that are produced by the system. 

This program will close on December 31, 2019, so the sooner you install solar and apply to the program, the better!



Tax exemptions

Alabama does not have a statewide property tax or sales tax exemption. However, the state does have a local option for tax exemptions. This means that if a municipal or county government decides they want to exempt the assessed value of a solar system from property or sales taxes, they can, but it is not required throughout the state.  

Alabama Solar Calculator

Regardless of what you want to know about the economics of installing solar panels for your home or business in Alabama we have a solar calculator that can show you exactly the information your require.



What you can find out about installing solar panels in Alabama using our full monthly solar calculator

This solar calculator requires you to input your address, utility company, your average monthly power spend - It tells you:

If you want to see all of the above but also see live pricing, the three best solar deals available in your city and get binding quotes from each of these solar companies then use this Alabama solar panels calculator. This calculator requires you to also input your name and contact details because most of our 200+ installer partners will only authorize the sharing of their live solar pricing where we have validated that you are a real homeowner with a home in their service area. We respect the privacy of your data and only share your contact details with the solar companies you ask us to get binding quotes from.


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Going solar in Alabama

Check out all of the ways energy providers of Alabama can help you be more energy efficient and save money.

The following programs are available:
Incentive Name Eligibility Type
Residential Renewable Energy Tax Credit Federal Personal Tax Credit
Local Option - Sales and Use Tax Exemption State Sales Tax Incentive
Local Option - Property Tax Exemption State Property Tax Incentive
Tennessee Valley Authority - Green Power Providers Utility Performance-Based Incentive
Alabama Power Company - Net Metering Utility Net Metering
Find your local rebates and incentives

Your city may have further incentives to offer. Please keep in mind that the best source of up-to-date information on incentives are the solar installers who specialize in your area.