Electricity Rates in Alabama
Average residential electricity cost, utility comparison, and solar savings potential for Alabama homeowners.
Alabama Electricity Cost Overview
The average residential electricity rate in Alabama is $0.13 per kWh, which is 19% below the national average of $0.16/kWh.Alabama homeowners pay an average of $124 per month for electricity, based on typical usage of 957 kWh per month.
Electricity rates in this state have been trending upward over the past decade, following national patterns of rising energy costs. As rates continue to increase, solar panels become an increasingly attractive way for homeowners to lock in their energy costs and achieve long-term savings.
Major Electric Utilities in Alabama
| Utility Company | Avg Rate ($/kWh) | Customers | Est. Monthly Bill |
|---|---|---|---|
| Alabama Power | $0.13 | 1.5M | $124 |
| Tennessee Valley Authority | $0.11 | 500K | $105 |
| Huntsville Utilities | $0.12 | 200K | $115 |
How Solar Compares to Alabama Electricity Rates
Without Solar
- Monthly bill: $124
- Annual cost: $1,488
- 25-year cost: $37,200
- Rate trend: Rising 2-5% annually
With Solar
- Monthly savings: $97
- Annual savings: $1,164
- 25-year savings: $29,000
- Rate: Locked in for 25+ years
Electricity Rates FAQ - Alabama
The average residential electricity rate in Alabama is $0.13 per kilowatt-hour (kWh), which is 19% below the national average of $0.16/kWh. The average monthly electric bill is approximately $124.
With solar panels, Alabama homeowners can reduce their electricity costs by approximately 78%, saving around $97 per month or $29,000 over 25 years. The 30% federal tax credit further reduces the upfront cost.
The largest electric utilities in Alabama include Alabama Power, Tennessee Valley Authority, Huntsville Utilities. Rates vary between utilities, so your exact cost depends on your provider and usage.
Yes, electricity rates in Alabama have been increasing over time, following national trends of 2-5% annual increases. This upward trend makes solar panels an increasingly attractive investment since they lock in your energy costs for 25+ years.
Get your free solar quote
Real prices from vetted local installers — in 2 minutes.
No obligation • Compare top installers
Electricity Rates by City in Alabama
Solar in nearby states
Ready to go solar?
Compare instant quotes from top local installers
Start saving with solar today.
Join thousands of homeowners who've switched to clean energy and locked in decades of lower bills.