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Solar Tax Credits, Incentives and Solar Rebates in Alabama

Latest Update:

by Simone Garneau

State Seal of AlabamaSolar Energy OutlookState Flag of Alabama

Summary Data for AL

State Capital Montgomery
Solar Value Index $913
Solar Energy Produced 7,222 kWh / year
Average retail electricity price (as of December 2017) 12.64 cents / kWh
Average annual consumption per household (2015 data) 14,619 kWh
Levelized Cost of Solar Electricity 7.75 cents / kWh
Reached grid parity? Yes

The Yellowhammer State has a rich history and plenty of sunshine.Unfortunately, most of the solar potential goes unused. Alabama mostly runs on coal, natural gas and nuclear energy. The only renewable energy sources that make a dent are hydroelectric power and biomass.

At 12.64 cents/ kWh, the electricity prices in the state are below the national average of 12.81 cents / kWh. When it comes to average electricity consumption per household, residents of this state consume 14,619 kWh per year, above the national average of 10,836 kWh.

Currently, Alabama has 7 financial incentive programs and no regulatory programs supporting the adoption of solar energy. Unfortunately, Alabama does not offer a state income tax credit.

Alabama is a grid parity state, making solar power cheaper than the residential utility rates. Especially when used in combination with the 30% federal solar tax credit, the incentives listed below can significantly reduce the cost of installation of solar panels for your home or business.

List of Solar PV Incentive Programs in Alabama

Financial Incentives

Regulatory Policies

Unfortunately, there are no state-specific regulatory policies in Alabama.

Methodology Notes

  • Average electricity consumption data is from the U.S. Energy Information Administration.
  • Average retail electricity price is from the Electric Power Monthly report of the U.S. Energy Information Administration.
  • Solar Value Index is based on the analysis performed using our own solar energy calculator, Sunmetrix Discover.
  • The estimated lifetime of solar panels is 25 years for the purposes of calculating the Levelized Cost of Electricity (LCOE).
  • State incentives list is compiled from the Database of State Incentives for Renewables and Efficiency maintained by the N.C. State University.

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Written by Simone

Simone Garneau is the co-founder of Sunmetrix, an online consumer education website for residential solar energy. The goal of Sunmetrix is to help homeowners go solar and save money. In addition to the 200+ articles about solar energy, Sunmetrix offers homeowners two other great resources: a Consumer Report for solar energy, and Discover, to preview solar energy for your home.
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Sunmetrix is a Canadian winner of the business innovation contest organized by the U.S. Department of Energy

Your website is excellent. It provides great information and advice.

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