State and Local Policy Database


State Scorecard Rank



5.0Scored out of 50Updated 12/2022
State Government
Score: 1.5 out of 4.5
State Government Summary List All

The Alabama state government leads by example, requiring energy-efficient fleets and coordinating an energy savings performance contracting program. In addition, the state funds several loan programs. Research focused on efficient vehicles is conducted at the University of Alabama.

Financial Incentives List All

The state of Alabama offers the following financial incentives to encourage energy efficiency improvements:

  • AlabamaSAVES Revolving Loan Program
  • Volkswagen Settlement
  • Energy Efficient Retrofit Program
  • Local Government Energy Loan Program

Further financial incentive information can be found in the Database of State Incentives for Renewables and Efficiency (DSIRE Alabama). In addition to these state-funded incentives, Alabama has enabled commercial Property Assessed Clean Energy (PACE) financing but does not yet have any active programs. For additional information on PACE, visit PACENation.

Last Reviewed: August 2022

Equity Metrics and Workforce DevelopmentList All

At this time, the state does not conduct a state energy, sustainability, or climate action plan, and has not adopted specific goals, metrics, or protocols to track or evaluate how any energy, sustainability, or climate action initiatives being taken are affecting local marginalized groups.

Workforce Development

The State of Alabama has implemented a Building Operator Certification (BOC) program, which is a national training and certification program for commercial facility managers to educate them on efficient management of their building portfolio. Through this workforce development initiative, an in-state administrator, Bevill State Community College has been selected, and the State of Alabama is providing financial support for administration of the program. The trainings that have been provided so far have been open to individuals from both public and private organizations, but the State of Alabama has provided scholarships to facility managers and maintenance technicians for K-12 schools and local governments that do not have the funding available for professional development and workforce training.

Last Reviewed: September 2022

Carbon Pricing PoliciesList All

The State of Alabama does not yet have carbon pricing policies in place.

At this time, the state does not have a statewide emissions reduction goal in place.

Last Reviewed: September 2022

Building Energy Disclosure List All

There is no disclosure policy in place.

Last Reviewed: July 2020

Public Building Requirements List All

The Alabama Division of Construction Management (DCM) has adopted the ANSI/ASHRAE/IESNA Standard 90.1-2013 Energy Standard for Buildings Except Low-Rise Residential, effective July 2016 and applicable to all state-funded buildings, as well as any construction on state-owned property, all public and private schools including kindergarten through twelfth grades and post-secondary education, hotels/motels, and movie theaters.

Executive Order 25, which expired in FY2015, required state agencies to reduce energy consumption in all conditioned facilities by 30% from 2005 levels by the end of FY2015, using the ENERGY STAR Portfolio Manager tool to measure and report energy performance. Participating state agencies exceeded the required 30% reduction with a 52% reduction in energy consumption and savings of over $16.5 million compared to their 2005 baseline usage. 

All public grant and loan recipients completing energy-efficient retrofits are required to benchmark energy usage in ENERGY STAR Portfolio Manager. Alabama has also implemented a Building Operator Certification targeting public facility managers, which will include instruction and required assignments on measuring and benchmarking energy performance.

Act 2015-435 created a division of Energy Management within the State Finance Department. The Division will formulate a statewide energy management program and promulgate uniform standards of energy management in all state-owned or state-leased facilities.

Last Reviewed: August 2022

Fleets List All

Alabama Act 2009-650 adopts a procedure for implementing and administering a green fleets program of procuring state motor vehicles based on criteria that include fuel economy and life cycle costing; requires fleet managers of state motor vehicles to classify their vehicle inventory for compliance with this act; establishes goals for fuel efficiency for state motor vehicles; establishes procurement policies; creates the Green Fleets Review Committee to ensure compliance; provides for advisory subcommittees; and provides that fleet managers submit annual plans for procuring fuel-efficient vehicles.

ACT-650 prescribes that the average fleet fuel economy be increased each fiscal year by four percent for light-duty vehicles, three percent for medium-duty vehicles, and two percent for heavy-duty vehicles, and implements an anti-idling policy for state owned or operated vehicles.

Executive Order Number 38 was signed by Governor Bentley on March 21, 2013, which ensured the compliance of the Green Fleet Law (Act 2009-650), which mandated improvements in fuel economy and emissions through life cycle cost procurement of new vehicles and utilization of proven new technologies in existing vehicles. This program focuses on issues such as fuel efficiency and cost-effective maintenance. The goal is to have the lowest possible cost per mile driven which is to include acquisition, operation and replacement.

Act 2019-219 requires the Alabama Department of Revenue to develop, maintain, and make available a fleet online registration and tax system (FORT system); to authorize the issuance of a fleet license plate by the department; and to establish an advisory committee.

Last Reviewed: August 2022

Energy Savings Performance Contracting List All

The Alabama Department of Economic and Community Affairs (ADECA) - Energy Division conducts the Performance Contracting Program providing information to procure and finance large energy improvement projects for the state’s public facilities. Alabama offers a manual with sample forms to assist with the ESPC process and a list of U.S. Department of Energy qualified ESCOs. The ADECA-Energy Division Co-Chairs the Alabama Energy Services Coalition Chapter and works to provide education, outreach, and technical assistance to promote the usage of ESPC for capital improvements. ADECA has identified the need to streamline the ESPC process and is currently working to develope a prequalified ESCO list. The goal of Performance Contracting Accelerator is to expand the use of performance contracting by federal, state, and local governments, K-12 schools, and others.

Last Reviewed: July 2020

Research & Development List All

The University of Alabama’s Center for Advanced Vehicle Technologies (CAVT) assists in the research and development of numerous transportation systems and vehicles.  Their efficiency research is primarily focused on improving powertrains as well as energy storage and fuel cells.

Last Reviewed: July 2019

Score: 3 out of 12
Buildings Summary List All

Alabama has mandatory building codes for both residential and commercial buildings, although local jurisdictions may adopt more stringent codes. The state's residential code references to the 2015 IECC, however, state-specific amendments weaken it significantly. The state's commercial code references ASHRAE 90.1-2013. Alabama has completed limited code compliance activities. The AERC Board is preparing to begin consideration of the 2018 IECC and ASHRAE 90.1-2016.

Residential Codes List All

The Alabama Energy and Residential Code (AERC) Board adopted the 2015 Alabama Residential Energy Code. While the residential code is based on the 2015 IECC, state-specific amendments weaken it significantly, making it more efficient than the 2009 IECC but not equivalent to the 2015 IECC. The updated residential code took effect October 1, 2016. Local jurisdictions may adopt more stringent codes, and several have adopted the 2015 IECC without the state-adopted amendments. The AERC Board is preparing to begin consideration of the 2018 IECC and ASHRAE 90.1-2016.

Last Reviewed: August 2022

Commercial Code List All

The Alabama Energy and Residential Code (AERC) Board adopted the 2015 Alabama Commercial Energy Code, based on ASHRAE 90.1-2013. The updated commercial code took effect January 1, 2016. Local jurisdictions may adopt more stringent codes.

Last Reviewed: August 2022

Compliance List All
  • Baseline & Updated Compliance Studies: Alabama was one of eight states participating in the US DOE's Residential Energy Code Field Study, which included an initial field study, followed by education and outreach, as well as follow-up data collection to determine the impacts of education on compliance. Alabama's initial compliance rates with the 2009 Alabama Energy and Residential Codes were at least 92%, prompting a re-analysis of savings potential based on the newly adopted 2015 Alabama Energy and Residential Codes.
  • Utility Involvement: There are no commission regulatory guidelines or mandates, but utilities are represented on the AERC Board and are actively involved in supporting energy code compliance through that process as well as education and outreach efforts through the Board and the State Energy Office. Alabama Power also provides low or no-cost training to certify contractors to provide Duct and Envelope Tightness testing verification, as required effective January 1, 2014, under the Alabama Energy and Residential Code.
  • Stakeholder Advisory Group: The Alabama Energy Residential Code Board includes representatives from 17 different organizations with an interest in codes. The AERC Board is legislatively required to meet at least once per year, but typically meets closer to quarterly, with meetings held as needed. Furthermore, the Project Team at the DOE Energy Codes Field Study, which is organized through the Institute for Market Transformation, has also served as a stakeholder group since the beginning of the project, helping to coordinate the Field Study efforts, reviewing results, and helping to drive the education and outreach efforts based on those results. The members of this project team can be found here.
  • Training/Outreach: The Alabama Department of Economic and Community Affairs (ADECA) has been actively providing energy codes training for many years. Recent efforts include specific training on the new Alabama Energy and Residential Code targeted toward all building industry professionals as well as building and code officials and inspectors. This year, additional training efforts are being focused on developing resources like online training modules, training videos, and field guides.

Last Reviewed: September 2022

CHP Summary List All

Alabama offers a financing program for CHP projects but otherwise has limited policies to encourage CHP. No new CHP systems were installed in 2018.

Interconnection StandardsList All

Alabama has not implemented statewide interconnection standards.  In response to the Energy Policy Act (EPAct) of 2005, the state examined existing interconnection agreements with utilities and determined that, except for a few provisions which were addressed by the state, existing interconnection agreements addressed best practices for distributed generation and concluded that no statewide standards were necessary.

Last Updated: July 2018

Encouraging CHP as a ResourceList All

There are currently no state policies designed to acquire energy savings from CHP (like other efficiency resources) or energy generation from CHP (in terms of kWh production) that apply to all forms of CHP.

Last Reviewed: July 2019

Deployment IncentivesList All

Incentives, grants, or financing: CHP systems may have access to loans through the Alabama SAVES Revolving Loan Program. Administered by the Alabama Department of Economic and Community Affairs, this revolving loan program is designed to specifically address industrial energy use. CHP is an eligible technology and loans range from $50,000 to $4 million and offer a 1% interest rate.

Last Reviewed: July 2019

Additional Supportive PoliciesList All

There are currently no additional supportive policies to encourage CHP.

Last Reviewed: July 2019

Score: 0 out of 15
Utilities Summary List All

Alabama currently offers only very limited energy efficiency options. Alabama’s regulators have not encouraged nor required the state’s sole investor-owned utility (IOU), Alabama Power, to pursue energy efficiency, and as a result, the utility has yet to implement a comprehensive set of programs. The Tennessee Valley Authority (TVA) and its distribution utilities in northern Alabama, which are not subject to state regulation, also implement minimal programs. Overall, Alabama Power and the cooperative utilities approach energy efficiency very skeptically. The utilities invest far more on load management programs than energy efficiency programs. 

Electric utility service in Alabama is provided by one jurisdictional company (Alabama Power Company) and a number of non-jurisdictional entities including TVA, distribution cooperatives, and municipal systems. Alabama’s regulator, the Alabama Public Service Commission (APSC), encourages Alabama Power to pursue energy efficiency programs, but a cost-effectiveness requirement results in Alabama Power having fewer offerings than are seen in many other states.

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables.

Last reviewed: April 2022

Customer Energy Efficiency Programs List All

A handful of utilities offer some small energy efficiency program offerings in Alabama, but the level of investments and savings from efficiency are far lower than the national average. The Tennessee Valley Authority (TVA), a federally-regulated utility which provides electricity to 17 municipal and cooperative utilities in Alabama, offers the largest energy efficiency program offerings through participating partner utilities. The state's only regulated investor-owned utility, Alabama Power, and a few other cooperative utilities offer energy efficiency programs. However their demand-side investments focus mainly on load management rather than energy efficiency. Alabama Public Service Commission (APSC) encourages Alabama Power to pursue energy efficiency programs, but a cost-effectiveness requirement results in Alabama Power having fewer offerings than are seen in many other states. 

There are currently no natural gas efficiency programs in Alabama.

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables.

Last Updated: June 2017

Energy Efficiency as a Resource List All

In Docket 31045, the APSC recognized that energy efficiency is considered a priority resource. Every three years, or as otherwise required by the APSC, Alabama Power Company submits an integrated resource plan (IRP) to the APSC. The last IRP submittal was in September 2013. The plan includes the company’s forecast requirements, taking into account present and projected energy demands and reductions in any and all sectors resulting from improved energy efficiency measures. For purposes of the IRP, the energy efficiency resource is embedded in the results of the load forecasting process, which captures the actual customer response to those programs. 

Last Updated: June 2017

Energy Efficiency Resource Standards List All

There is currently no EERS in place.

For more information on Energy Efficiency Resource Standards, click here.

Last reviewed: April 2022

Utility Business Model List All

Alabama Power Company and Alabama Gas Company recover their retail costs (including a reasonable return) through a formulary rate approach called Rate RSE (Rate Stabilization and Equalization). Operations under Rate RSE can produce either upward or downward revenue adjustments, depending on whether the return calculated thereunder falls below or above an authorized range.

In accordance with the Energy Independence and Security Act of 2007, the Alabama Public Service Commission (APSC) opened a docket to consider (among other things) proposed standards regarding: (i) the integration of energy efficiency measures into utility integrated resource planning (IRP); and (ii) rate design modifications to promote energy efficiency investments. (See Docket No. 31045). At the conclusion of that proceeding, the APSC found that Alabama Power and Alabama Gas already have established IRP programs that meet the goals of the former, and that they both offer APSC approved rates, programs, and initiatives that achieve the goals of the latter. Accordingly, the APCS found it unnecessary to adopt any additional policies.

Alabama Power and Alabama Gas Company may recover a reasonable rate of return on efficiency spending via a rate rider.

Last Updated: July 2017

Evaluation, Measurement, & Verification List All

The Commission permits rate recovery for energy efficiency programs that are cost-effective for all retail customers.

Last Updated: July 2017

Guidelines for Low-Income Energy Efficiency Programs List All

Requirements for State and Utility Support of Low-Income Energy Efficiency Programs

No specific required spending or savings requirements were identified.

Alabama Power is currently running a low-income pilot but has not established a sustained low-income energy efficiency program.

Cost-Effectiveness Rules for Low-Income Energy Efficiency Programs

No specific adjustments or exceptions to general cost-effectiveness rules are in place for low-income programs.

Coordination of Ratepayer-Funded Low-Income Programs with WAP Services

Level of coordination is unclear from publicly available data.

Last updated: June 2017

Self Direct and Opt-Out Programs List All

Alabama does not have self-direct or opt-out provisions for large customers. 

Last updated: July 2017

Data AccessList All

Guidelines for Third Party Access

Alabama does not have policies in place that require third party access to customer energy use data.

Requirements for Provision of Energy Use Data

No policies are in place that require the provision of energy use data.

Energy Use Data Availability

Alabama Power Company offers customers access to electronic data. My Power Usage gives residential customers an in-depth look into their energy consumption by allowing secure access to the amount of energy they use on a daily and monthly basis. It features email notifications to customers when their bills reach a designated dollar amount, along with energy efficiency tips to help save on monthly power bills. EnergyDirect is an online energy management tool for business class customers that displays energy usage and costs for monthly, daily, and interval data.

Last Updated: June 2017

Score: 0.5 out of 13
Transportation Summary List All

Alabama has historically focused its efforts on policies to encourage energy efficiency in the transportation sector, though is currently exploring opportunities to expand EV charging infrastructure. There is significant room for growth.

Tailpipe Emission Standards List All

No policy in place or proposed.

Last Reviewed: November 2022

Transportation System Efficiency List All

Transportation and Land Use Integration: No policy in place or proposed.

VMT Targets: No policy in place or proposed.

FAST Freight Plans and Goals: The 2016 Alabama Statewide Freight Plan identifies the major transportation routes and infrastructure for road and rail freight, but it does not include efficiency performance measures. One innovative freight efficiency program the state has implemented is delivery space booking systems, which reserves a parking space for a specific vehicle to load or unload freight during a specific time period. The systems help reduce fuel consumption, environmental impacts, and network congestion, specifically in urban areas.

Last updated: November 2022

Transit Funding List All

No policy in place or proposed.

Last Reviewed: November 2022

Incentives for High-Efficiency Vehicles List All

No policy in place or proposed.

Act 2019-2 or "Rebuild Alabama Act" establishes an Electric Transportation Infrastructure Grant Program to to fund electric vehicle transportation charging infrastructure.

The State of Alabama is currently working with a contractor to establish a Zero Emission Vehicle Supply Equipment Infrastructure Plan for the State.  Once the plan is finalized, $3,248,823.40 from the Volkswagen Settlment and $1 million in state funds have been set aside for implementation.  Additionally, another $1 million in state funds has been allocated to marketing electric vehicles.

Last Reviewed: November 2022

Equitable Access to TransportationList All

Alabama does not have any programs in place to incentivize the creation of low-income housing near transit facilities nor do they consider proximity to transit facilities when distributing federal Low-Income Housing Tax Credits to qualifying property owners.

Last Reviewed: November 2022

Appliance Standards
Score: 0 out of 3
Appliance Standards Summary List All

Alabama has not set appliance standards beyond those required by the federal government.

Last Reviewed: June 2019