Alabama Power has announced plans to maintain steady electric rates for its customers through 2027. This decision comes after their formal notification to the Alabama Public Service Commission (PSC) on November 21, 2025.
Proposal for Rate Stability
The company’s proposal includes commitments aimed at achieving rate stability. Alabama Power has been collaborating with the PSC staff and the Attorney General’s Office to assess projected costs for the upcoming years 2026 and 2027. By adhering to the current compliance factors under Rate CNP for 2026, Alabama Power aims to alleviate potential bill increases.
Details of Rate CNP Adjustments
The Rate CNP consists of multiple parts:
- Part A: Covers costs for new power plants or major facilities.
- Part B: Addresses further expenses related to the power supply.
- Part C: Relates to compliance with environmental regulations.
Alabama Power intends to freeze Part C rates through the end of 2027, mitigating increases associated with government compliance expenses. Additionally, the implementation of Part A adjustments will be postponed until January 2028. This delay prevents new plant-related costs from being passed on to customers.
Commitments and Funding Strategies
The company will maintain the current Rate CNP, Part B factor until March 2028 and extend the interim Environmental Cost Recovery factor through 2027. To fulfill these commitments, Alabama Power plans to focus on internal cost management. Moreover, they seek PSC approval to apply any customer refunds from the 2025 Rate RSE calculation to the Natural Disaster Reserve, which currently has a negative balance.
Another strategy includes utilizing federal nuclear production tax credits from 2025 to 2027 to help offset retail service costs.
Company’s Ongoing Communication
In a statement to Alabama Public Radio, Alabama Power expressed its commitment to helping customers manage their electricity expenses. They acknowledged that budgets are increasingly tight, stating, “We know budgets are tight, and power bills are a real concern for many families and businesses.” The company emphasized the importance of providing predictability concerning electric rates amidst other rising costs.
Future Considerations
While Alabama Power is committed to following through on these plans, they also noted that various factors, such as weather conditions and fuel market fluctuations, could impact their commitments. The PSC is currently reviewing the proposal and will determine the next steps regarding this matter.
