Alabama solar panels: The complete guide in 2026
Data updated Jan 23, 2026
Interested in going solar? You'll need to install a 14.51 kW solar panel system to cover the average electric bill in Alabama, which will cost you about $42,880.
Cost for an average system in Alabama
| Cash price | $42,880 |
| 25-year savings | Payback period | Electricity offset |
|---|---|---|
| $49,258 | 14 Years | 82% |
Some states, towns, and utility companies offer incentives that can help lower the cost of solar.
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Going solar in Alabama
Alabama’s sunny skies, mild winters, and above-average natural gas prices make it a natural fit for solar panels––they'll reduce your carbon footprint and your reliance on the utility electric grid.
Factor in local incentives, and Alabamans can cut the cost of solar by thousands of dollars, speeding up your payback period and increasing the value of your investment.
Here's what you should know about going solar in Alabama.
Cost
How much do solar panels cost in Alabama?
Solar panels will save you a lot of money over time, but the upfront costs aren't cheap. The average Alabama homeowner needs a 14.51 kW solar panel system to cover their electricity needs, which comes out to $42,880 before incentives. Prices range from $36,448to $49,312, but Alabama also has some great local incentives.
While this may sound high, it will pay off in Alabama. That's why over 2,900 Alabama homeowners have used EnergySage to receive and compare quotes for solar installations. You can expect to earn back your initial solar investment through electricity savings in about 14.08 years, while most systems last at least 25 years. You'll often see this number referenced as your solar payback period.
There are a few ways to finance your solar panel system so you don't have to provide all that money upfront.
Cash purchase: You'll own the system and pay for it up front. This provides the best long-term savings.
Solar lease or power purchase agreement (PPA): A third-party company owns your system and either leases you the solar panels (solar lease) or allows you to purchase the electricity they generate (PPA). These typically deliver immediate savings and can make a lot of sense if you’re looking to keep your capital flexible. Just make sure to choose an offering with low annual escalators to ensure it will continue to provide long-term savings.
Solar loan: This allows you to retain ownership of your system while owing little to no money upfront. Solar loans aren't all created equal. If you have access to subsidized clean energy loans through local incentive programs, that's usually your best bet. A home equity loan or a personal loan are often your next best options—private solar loans typically come with higher interest rates or upfront fees.
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Incentives
What are the best solar rebates and incentives in Alabama?
Incentives help bring solar's price tag down considerably in Alabama. Here are the major ones to know about:
| Incentive | Average savings in Alabama | Description |
|---|---|---|
Alabama solar property tax exemption | 0.4% of your system’s cost, annually on average | If you use solar energy as a source of power, and your city or town approves your application, you won't need to pay a property tax for 10 to 20 years on the value your solar panels add to your property. |
Is net metering available in Alabama?
Alabama doesn’t offer net metering, but if you’re an Alabama Power customer, you can benefit from net billing. The catch is that the utility company only offers partial credit for every kWh. You'll have to sell the electricity to them at a significant discount compared to what they’ll charge you to buy that electricity back later.
Learn more about this solar buyback program:
Equipment
Equipment quality
Solar panel efficiency continues to improve every year—that is, they produce more power per square foot. As of 2025, many top-selling solar panels produce around 450 watts in full sunlight. To maximize your roof’s production potential, look for panels with at least that level of output.
It’s also important to choose an inverter setup that fits the design of your roof.
And if you plan to add a solar battery, make sure it’s compatible with your inverter setup for smooth integration.
While higher-end equipment can be more expensive upfront, it often leads to greater savings over time. Premium products usually come with longer warranties—up to 25 years or more—and are built to last. They also degrade more slowly, meaning you’ll get more consistent energy production further into the future.
Companies
Who are the best solar installers in Alabama?
We pre-screen all of the solar companies on EnergySage to ensure they'll provide you with a high-quality installation. We then rate them based on their results, reputation, and responsiveness. Here are the highest-rated EnergySage installers in Alabama:
Ready to start looking for a solar installer?
Here are some of the most popular ones near you:
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resources
Top solar resources for Alabama
- Alabama Solar Loan Providers
Search through our list of top loan providers to finance your solar panel system.
- Alabama Department of Economic and Community Affairs
Learn about AL energy programs from the state government.
- Alabama Public Service Commission
Read more about how utility companies work in AL.
- Alabama Electricity Profile (EIA)
Learn about AL energy production and prices.
- AL State Solar Factsheet (SEIA)
See quick stats about how much solar energy has grown in AL.
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