Alabama solar rebates and incentives: 2026 guide

Alabama doesn't offer the strongest solar incentive programs out there. But that doesn't mean solar isn't worth it—especially if your electric bills are eating up a big chunk of your monthly budget.

Solar's real value isn't about rebates. It's about taking control of your electricity costs for the next 25-30 years. As utility rates continue their steady climb, locking in lower energy costs now can deliver substantial savings over time. Even without robust state programs, many Alabama homeowners with decent sun exposure and moderate to high electric bills find that solar still pays for itself. Here's how you may be able to lower your solar costs in Alabama—and whether it makes sense for your home.

Unfortunately, Alabama doesn't offer many incentives for solar. But if your electric bills are high, going solar can still make sense.

Alabama offers a solar property tax exemption. Solar panels generally raise the property value of your home, but thanks to this law, you might not have to pay extra tax on that added value.

Alabama doesn't offer a state-wide net metering program, but Alabama Power, the state’s largest utility, does offer a solar buyback program.

While the sun is shining, your solar panels might produce more electricity than your home needs at any given moment. Under Alabama Power’s net billing solar buyback program, you can sell that excess power back to the grid for credits on your electricity bill. 

The catch is that the utility company only offers partial credit for every kWh—you’re selling the electricity to them at a significant discount, compared to what they’ll charge you to buy that electricity back later. 

Rates change over time, but it’s generally less than half the retail rate. From June through September 2024, you’ll earn $0.043 per kWh during peak hours and $0.0309 per kWh during off-peak times. Those rates are reduced further from October through May; you’ll only receive $0.0333 for your excess generation during peak times and $0.0316 per kWh during off-peak periods. 

Considering you pay around $0.15 per kWh for electricity in Alabama, this solar buyback program isn’t great. The best way to maximize the value of your solar panels under net billing is to install a solar battery with your panels. 

Alabama doesn't offer any state-specific battery incentives.

Solar batteries paired with solar panels can make good financial sense in Alabama. They boost energy independence and provide backup power during an outage, helping you keep more of your own (free) solar power rather than letting the utility company take it at a steep discount. 

If you're looking for solar installers in Alabama, see the complete list.