Avoided Cost

Net Metering in Alabama

Current NEM policy, export rates, and impact on solar payback for Alabama homeowners.

NEM Export Rate

$0.045

per kWh

Avg Retail Rate

$0.143

per kWh

% of Retail

31%

compensation

Policy Status

Active

since 2020-01

System Limit

Up to 100 kW

max eligible

NEM Policy Details — Alabama

How Alabama compensates your excess solar generation

Avoided CostActive

No statewide net metering mandate. Alabama Power offers a Solar Generation Buyback rate at avoided cost (~$0.045/kWh). No NEM policy from other major utilities.

NEM Rate$0.045/kWh
Retail Rate$0.143/kWh
Savings Gap-9.8c/kWh
Annual True-UpYes

Source: DSIRE, Alabama Power tariff sheets · Effective: 2020-01

Calculate Your NEM Savings in Alabama

$

NEM Rate Comparison

$0.00Alabama: $0.045$0.143 (retail)

Alabama's NEM rate is 31% of the retail electricity rate — significantly below retail, consider self-consumption or battery storage.

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Written & reviewed by

Jeremy Wolfe — Senior Solar Energy Analyst

Jeremy Wolfe is a solar energy analyst specializing in residential photovoltaic economics, federal and state incentive policy, and return-on-investment modeling for homeowners. He leads EnergyTools' solar research program and methodology.

  • 10+ years analyzing residential solar economics and payback modeling
  • Lead researcher for EnergyTools' 50-state solar cost-per-watt database
  • Author of 100+ solar ROI, payback, and incentive analyses

Methodology & data sources:NREL PVWatts, EPA FuelEconomy.gov, state utility commissions— updated 2026.