Green Driver State Incentives in Alabama

Alabama offers a handful incentives for local green-minded drivers. Whether you drive (or are considering buying) a hybrid vehicle, an electric car, or some other alternative fuel vehicle, read on to learn how environmentally conscious AL drivers can save money while reducing their carbon footprint.

Please note that as Alabama becomes greener, incentives and legislation will also evolve. Keep pace through your local AL Motor Vehicle Division office and the Alternative Fuels Data Center.

AL Registration Emissions Testing Exemptions for Fuel-Efficient Vehicles

At this time, the Alabama Motor Vehicle Division (MVD) does not require emissions testing as a prerequisite for AL vehicle registration. Therefore, drivers of fuel-efficient vehicles get no extra perks. However, you can learn more about emissions and smog testing run by private organizations on our Alabama Smog & Emission Checks page.

Auto Insurance Discounts for Eco-Friendly Driving and Green Vehicles

Some Alabama auto insurance providers offer insurance discounts for having green driving habits and/or driving a fuel-efficient vehicle. Consult your car insurance company about potential green vehicle discounts such as:

  • Hybrid auto discounts.
  • Alternative fuel vehicle (AFV) discounts.
  • Economy car discounts.
  • Low-mileage discounts.
  • Pay as you drive discounts.

Auto insurance discounts vary by provider and circumstances. For example, you might receive a 10% discount on car insurance for owning or leasing a hybrid car, while maintaining low mileage, in some states, you can earn you up to a 40% auto insurance discount.

If your current AL auto insurance carrier doesn't reward eco-friendly driving, find one that does. Compare auto insurance rates online and save some green for going green.

Tax Incentives for Alabama's Eco-Friendly Drivers

Alabama offers its residents a tax break for pollution control equipment. Plus, you might be eligible for federal tax credits through the Internal Revenue Service (IRS). Read on for specifics.

To more easily navigate tax incentives when it comes time to file, consider consulting a tax professional, the Alabama Department of Revenue, or your local IRS Taxpayer Assistance Center.

Pollution Reducing Equipment Tax Exemption

According to the Code of Alabama (Section 40-9-1), all devices, facilities, or structures (and their components) used to reduce air pollution are property tax exempt.

Federal Tax Credits for Fuel-Efficient Vehicle Owners

There are a number of federal tax credits offered by the IRS for fuel-efficient vehicle owners. You might qualify if you own:

  • Electric cars (EV).
  • Hybrids.
  • Plug-in hybrids (PHEV).
  • Diesels.
  • Alternative fuel vehicles (AFV).

To find out if you're eligible to save even more money via federal tax incentives, consult the Tax Incentive Information Center.

Alabama Idle Reduction Weight Exemption

For eligible Alabama drivers whose vehicles either have an auxiliary power unit (APU) or other idle reduction technology, the State offers an idle reduction weight exemption. The exemption allows your vehicle to exceed the following weight limits by up to 400 lbs:

  • Gross.
  • Axle.
  • Tandem.
  • Bridge formula.

All you have to do to qualify is provide written proof or certification of the APU's weight and show (or certify) that the idle reduction technology works properly at all times. For more on this state exemption, refer to the Code of Alabama 32-9-20.

Alabama Power Charging Rate Incentive for Plug-in Electric Vehicles

Alabama Power offers two types of money-saving incentives for those who drive plug-in electric vehicles (PEVs): business and residential.

Residential Electric-Vehicle Incentive

Alabama Power customers who own a qualifying plug-in electric vehicle can take advantage of an optional Rate Rider. Learn more on this monthly rate discount—if your PEV was manufactured primarily for use on public streets, roads, and highways, and you take service under Rate FD, RTA, or Rate RTA-Energy—by downloading the Alabama Power Residential PEV Rate guide. Keep in mind, the following vehicles do not qualify:

  • Electric scooters.
  • Electric bicycles.
  • Golf carts.
  • Motorized electric wheelchairs.

Business Electric-Vehicle Incentive

If you use your plug-in electric vehicle for non-residential purposes, you might qualify for Alabama Power's Business Electric Vehicle Time-of-Use (BEVT) rate. The power company meters electricity used to charge electric vehicle batteries separate from all other electrical load. Therefore, you could get a discounted rate depending on your time of use. For more on this money saver, consult Alabama Power’s BEVT rate guide.

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