State energy regulators approve Alabama Power’s billion-dollar fossil fuel expansion as customers fall behind on bills and worry about utility shutoffs

MONTGOMERY, AL - Late Friday, the Alabama Public Service Commission (PSC) greenlighted Alabama Power’s billion-dollar fossil fuel expansion and booted its solar investments to a different docket. This presents a massive economic risk for Alabama Power’s customers as the PSC approved the utility’s plans to pass all the costs of building and maintaining the new gas plants onto its customers. Additionally, at the rate clean energy technology is improving and dropping in cost, it's likely the gas plant will become a stranded asset that customers will still have to pay off.

Overall, Southern Company’s proposal will cost Alabama Power customers well over one billion dollars, and commit Alabama to increasingly more expensive fossil fuel use for at least forty years. 

Alabama Power, a subsidiary of Southern Company, proposed the fossil fuel expansion in the fall of 2019. The expansion includes building a new fracked gas plant at the Barry coal plant outside Mobile, buying another aging fracked gas plant called “Central Alabama” in Autauga County, and buying energy from another aging fracked gas plant called “Hog Bayou” by Africatown, near Mobile. This expansion increases Alabama Power’s generating capacity by nearly 20%.

Last Friday, the Sierra Club also filed a motion which shows that the company failed to disclose key market developments that are directly relevant to its proposal. News has surfaced in recent weeks that Southern Company has been both the “impetus for” and “prime mover in” the formation of a “regional energy market” to facilitate surplus sharing between power companies in the Southeast. Sierra Club’s motion explained that this news should have been disclosed by the company and considered by the PSC because it is relevant to Alabama Power’s plans to abandon surplus sharing in favor of building and maintaining a large surplus of its own. However, the  motion was not mentioned in the PSC’s order from Friday.

Stephen Stetson, senior campaign representative for the Sierra Club’s Beyond Coal Campaign in Alabama, released the following statement:

“Clean energy is cheaper than gas, period. The Alabama PSC decided to give Alabama Power a gift from customers around the state to pay for a proposal that makes no economic sense. The ongoing pandemic means folks in Alabama are already facing uncertainty about money, and we shouldn’t also be hit with a rate hike for a gas plant that isn’t even needed. Our fight for Alabama families is far from over, and we will continue to push for sensible state policies that do right by customers, not line the pockets of Alabama Power.”