Table of Contents
- What to know?
- How long does it take to see a return on your investment in Alabama?
- Is Alabama good for home solar panels?
- How to pay for solar panels in Alabama
- What affects the cost of solar panels in Alabama?
- How to save on Alabama solar panel costs
- Alabama-specific solar considerations
- Who are the best solar installers in Alabama?
What to know
- Cost: About $13,965 for a 5 kW system to $27,930 for a 10 kW system after tax credit.
- Savings: 7 year payback; about $28,690 saved over 20 years.
- Environmental benefits: Potential to reduce your carbon emissions significantly.
Going solar in Alabama now averages about $3.97 per watt. That means you can expect to pay roughly $3,975 per kilowatt (kW) of installed capacity before incentives. For example, a 5 kW system typically costs around $19,950 before applying the 30% federal tax credit. Once you factor in that tax credit, the out-of-pocket cost for a 5 kW installation comes to about $13,965
However, a 5 kW system isn’t necessarily the best size for homeowners in Alabama. According to our data, Alabama residents currently pay an average of 15.61¢ per kWh, with a typical electric bill of around $177.77 per month for 1,139 kWh of consumption. Considering this energy usage, a 10 kW system is ideal to cover the energy needs of most.
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How long does it take to see a return on your investment in Alabama?
The upfront cost is what you pay for a system (whether you pay cash or finance doesn’t factor in this equation). The payback period is the amount of time until you break even on your investment considering savings from energy bills. And the net 20-year savings is what you save over 20 years minus the upfront costs. All of these work together to show how much you could save with solar in the state.
| 5 kWh System | Alabama Average | U.S. Average |
|---|---|---|
| Upfront Cost | $13,965 | $12,530 |
| Payback period | 7 Years | 7 Years |
| Net 20-year savings | $28,690 | $21,888 |
| *These are estimates. Getting personalized quotes from local installers is crucial for accurate pricing. | ||
Federal tax credit impact: The 30% federal Residential Clean Energy Credit significantly reduces your installation costs. For example, a $20,000 system would cost you $14,000 after the credit.
Is Alabama good for home solar panels?
To gauge potential, we look at average roof size, system capacity, and electrical production.
- Roof size: 912 sq. ft.
- System capacity: Up to 16,175 kW DC
- Electricity production: About 1,495 kWh AC per year
On average, a solar power system in Alabama can lower your electricity bill and pay for itself over time.
Below you can see power generation, cost, and savings of different system sizes.
| 6 kW System | 7 kW System | 8 kW System | 9 kW System | 10 kW System | |
|---|---|---|---|---|---|
| Roof Space | 429 ft² | 501 ft² | 572 ft² | 644 ft² | 715 ft² |
| Annual power value | $1,400 | $1,633 | $1,866 | $2,100 | $2,133 |
| Average cost | $16,758 | $19,551 | $22,344 | $25,137 | $27,930 |
| Average yearly production | 8,969 kWh | 10,464 kWh | 11,959 kWh | 13,454 kWh | 14,949 kWh |
| Average monthly savings* | $116.65 | $136.09 | $155.53 | $174.97 | $177.77 |
| Full payback period | 8 years | 9 years | 10 years | 12 years | 13 years |
| CO₂ reduction per year | 6.17 tons | 7.20 tons | 8.23 tons | 9.26 tons | 9.40 tons |
| *Savings assume a $177.77 monthly electricity bill | |||||
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How to pay for solar panels in Alabama
Purchasing solar panels is no small task. Here are a few ways you can pay for solar:
- Cash purchase: This is the best choice if you can afford it. Paying in cash gives you the best long-term savings but requires a larger upfront investment, of course.
- Solar loans: You can spread the cost over time with a loan, but be mindful of interest rates and loan terms.
- Solar leases and PPAs: Power purchase agreements (PPA) and leases have lower upfront costs. However, you don't own the system, which means you save the least over time. There can also be complications if you want to sell your home.
What affects the cost of solar panels in Alabama?
Several factors impact the final price of your solar installation:
- System size: Larger systems cost more upfront but often yield greater long-term savings.
- Panel type and efficiency: Monocrystalline panels are generally more efficient and expensive than polycrystalline or thin-film options.
- Installation complexity: Roof type, shading, and site-specific challenges can increase installation costs. Permitting and inspection fees also factor in.
- Additional considerations: Battery storage adds to the initial investment but provides backup power and greater energy independence. Labor and installation quality are also essential cost considerations.
How to save on Alabama solar panel costs
Getting the most bang for your buck is essential when investing in solar. Here are some strategies to save money:
- Maximize the federal tax credit: Understand the eligibility requirements and claim the full 30% credit.
- Shop around for quotes: Get quotes from multiple installers to compare pricing and services. Don't just focus on the lowest price; consider reputation, experience, and warranty.
- Consider system size: Be careful of going overboard. A properly sized system will meet your energy needs without unnecessary costs. Analyze your energy usage to determine the optimal size.
- Explore financing options: Compare loan interest rates and terms carefully. If considering a lease or PPA, understand the long-term implications and potential trade-offs. Cash purchases often offer the best long-term savings.
- Negotiate with installers: Don't be afraid to negotiate on price. Inquire about any discounts or promotions they may offer.
- Optimize your home's energy efficiency: Before going solar, improve your home's energy efficiency. This will reduce your overall energy consumption and potentially allow you to install a smaller, less expensive solar system. Simple steps like sealing air leaks and upgrading appliances can make a difference.
- DIY (if possible and permitted): While professional installation is generally recommended, some homeowners may be able to handle certain tasks themselves (like site preparation). Check your local regulations and be honest about your abilities.
- Ask about rebates and incentives: Many states, cities, and utility companies offer rebates, net metering, and other incentives. Check with your local utility and city/county for any available programs.
- Time your installation: Sometimes, installers offer discounts during slower periods. Inquiring about seasonal promotions might yield savings.
Alabama-specific solar considerations
- Weather Impacts: Alabama is blessed with plenty of sunshine, making it a great state for solar energy. However, the weather here can be a bit of a mixed bag. While you can expect solid solar performance on most days, the humid climate and occasional severe storms—including tropical systems and even tornadoes—mean that your system should be built to withstand some pretty intense weather.
- Regulatory and Legal Considerations: When it comes to permits and regulations, Alabama's process is generally straightforward. That said, it's always smart to check with your local authorities about any specific building codes or guidelines in your area. If you live in a community with an HOA, make sure to review their rules regarding solar installations so your setup fits right in.
Get a custom solar quote in Alabama
Going solar in Alabama can be a financially and environmentally sound decision. By understanding how much it costs and how much you can save, you can make an informed investment and enjoy using clean energy for years to come. Get multiple quotes from reputable installers, compare your options, and take control of your energy.
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