Solar power in Montgomery, Alabama
Alabama Power Company offers its Montgomery solar customers a net metering program. This helps homeowners reduce their electric bills by installing solar.
Montgomery residents can also take advantage of the federal solar tax credit. The tax credit is equal to a large part of the cost of a solar system — 26% in 2020, and 22% in 2021 — and is applied to your federal income taxes. In some cases, the credit could wipe out your entire tax bill for a year!
The combination of the federal tax credit and Alabama Power Company’s net metering program can provide you with a great return on investment when installing a solar system in Alabama.
Net Metering Broken Down
The utility will pay customers for the excess generation their solar system produces at a rate referred to as the “rate of purchase of alternative energy”. This rate is less than the retail rate of electricity.
The rate you receive for excess energy in Alabama varies depending on what time of day and what time of year the energy was produced.
Although the rate you receive is less than the retail rate, it is still extra money in your pocket that can be used to cover your utility bill costs
The average cost of installing residential solar panels in Montgomery,
Alabama in 2024 is
$2.61 per watt. The average system size
in the US is 6 kilowatts, which means the average price of a solar system
in Montgomery, AL
is $13,050.
(after claiming 26% tax credit and other rebates)
The 26% federal solar tax credit explained
If you have a federal income tax liability, 26% of the cost of your solar system can be claimed as a deduction to your taxes. This incentive is claimed when you do your taxes. In order to receive the tax credit quicker it's best to do your taxes as soon as possible after installation.
What if my tax liability is less than 26% of my systems costThere is the option to claim this incentive over several years if your tax liability is less than 26% of the system cost.
How much will solar panels on my home save me?
The answer to this question depends on your electricity usage. Generally speaking the greater your power usage the greater the potential savings from installing solar.
The average monthly usage in Alabama is only 1261kWh per month however, you are most likely using a lot more than this since this average includes condos and small apartments.
The Montgomery solar panel savings calculator below will convert your monthly power spend into power usage (in kWh's) and then work out exactly how many solar panels you need to offset your usage, how much they will cost based on the prices of local solar companies and the amount you will save. Our Alabama solar savings calculator can do this because it contains a database of the electric rates charged by Alabama Power Co, Dixie Electric Coop, Pioneer Electric Coop Inc, South Alabama Elec Coop Inc
How much can solar panels save you in Montgomery
What does the cost of a real solar system look like?
Facts about installing a 12.15kW solar system in Montgomery, AL
This system would offset 100% of your energy usage if your typical monthly bill is $154, however your situation may vary so try our Montgomery solar calculator to get a result tailored to you.
$20,679
Net cost of system
9 Years 3 Months
Average payback time
15,400 kWh
Annual power production
5¢/kWh
Levelized cost of solar energy
21¢/kWh
If you don't get solar
Cash flow graph based on cash purchase of this 12.15kW system
Life-time savings on this system over the next 25 years
$52,305
(Prices shown after repayments of capital)
Average total cost of solar panel installation in Montgomery
| System Size |
Cash purchase After 26% solar tax credit |
Financed purchase After 26% solar tax credit |
|---|---|---|
| 3kw | $6,305 | $6,809 |
| 4kw | $8,199 | $8,855 |
| 5kw | $9,953 | $10,749 |
| 6kw | $11,588 | $12,515 |
| 7kw | $13,105 | $14,154 |
| 8kw | $14,563 | $15,728 |
| 9kw | $15,851 | $17,119 |
| 10kw | $17,020 | $18,382 |
Find out what system size you need for your home
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 |
| Alabama Power Company - Net Metering | Utility | Net Metering |
Find your local rebates and incentives
Please keep in mind that the best source of up-to-date information on incentives are the solar installers who specialize in your area.
