Alabama Power has announced plans to maintain electricity rates for its customers stable over the next two years, as confirmed in a recent filing with the Alabama Public Service Commission. This decision, highlighted by Alabama Power’s Chief Financial Officer Moses Feagin, follows productive discussions with both the Commission and the Alabama Attorney General’s Office.
The utility expressed that this filing is part of their ongoing efforts to assist customers in managing their energy expenses. “We know budgets are tight, and power bills are a real concern for many families and businesses,” the company stated. They emphasized their commitment to providing predictability and stability in electric rates amid rising costs in other areas.
To achieve this rate stability, Alabama Power will implement internal cost containment measures. These efforts are expected to provide customers with reliable electricity costs without increases in the near term. The company plans to maintain certain rates associated with fuel charges and defer any adjustments related to their acquisition of the 895-megawatt gas-fired Lindsay Hill Generating Station until 2028. This move was recently approved by the PSC in August.
Previously, Alabama Power officials indicated that customers might see a slight increase of approximately $3.80 on their bills starting in 2027, although more recent assessments suggested a possible reduction of that expected increase for some customers. Additionally, Alabama Power is seeking authorization from the Commission to use potential customer refunds from the Rate Stabilization and Equalization (Rate RSE) mechanism to bolster their Natural Disaster Reserve, which is currently underfunded.
Rate RSE operates on a system where customer rates decrease if profits exceed projected levels, while any shortfalls would result in increased rates. Furthermore, the company is looking to utilize its nuclear production tax credits for 2024 to help mitigate retail service costs.
These plans come in the wake of Alabama Power’s forecast of a nearly 2 percent rate reduction for 2025. In their communication, the company conveyed confidence in fulfilling these commitments, based on the best available information, while also acknowledging that unpredictable factors like weather events and shifts in fuel markets could affect their plans.
The Alabama Public Service Commission’s next public meeting will take place on December 2 at 10 a.m. in Montgomery, where further discussions on these matters will likely take place.