Fight over participation in Alabama fuel cost proceedings heads to Circuit Court

MONTGOMERY, Ala.– This week Energy Alabama, represented by the Southern Environmental Law Center, appealed the Alabama Public Service Commission’s denial of Energy Alabama’s intervention in Alabama Power’s fuel cost proceedings. The appeal was filed Montgomery County Circuit Court Tuesday evening.

The Public Service Commission twice denied requests by Energy Alabama to intervene in Alabama Power’s fuel cost proceedings. According to the rules governing Rate Energy Cost Recovery (ECR), the public is entitled to hear evidence and participate in any proceedings adjusting fuel costs to ensure these changes are “just and reasonable.”  

The Public Service Commission has not held a public fuel cost hearing in 16 years, but the rate has been adjusted at least 18 times with no opportunity for the public to comment or review the data. The rules are clear: to make any changes to fuel cost–upward or downward–Alabama Power must submit estimates to the commission and the commission must hold a public hearing and allow intervention. There have been only two public fuel cost hearings since the rules requiring them were adopted in 1981. 

“The commission repeatedly adjusts Alabama Power’s fuel prices without allowing any public involvement,” said Daniel Tait, executive director of Energy Alabama. “In other states, advocates can meaningfully participate in fuel cost proceedings and have successfully advocated for reduced rates. We can’t fight for lower rates in Alabama if we don’t have a seat at the table.”

“Alabamians pay some of the highest energy bills in the nation, and those bills include the cost for fuel. Instead of allowing Alabama Power customers and interested parties to participate in the decision-making process, the commission is shutting them out,” said Christina Tidwell, a senior attorney in SELC’s Alabama office. “These rules have been on the books for decades. The commission needs to start abiding by them.”

Alabama’s ECR proceeding rules are based on Georgia’s Public Service Commission that regulates Alabama Power’s sister company, Georgia Power. The Georgia PSC has held at least 26 formal fuel cost proceedings. 

The cost of fuel, like coal and methane gas, is passed down to customers. Fossil fuel costs are prone to price volatility. For example, in 2022, Alabama Power’s average residential customer’s monthly bill rose over $18 a month because of sky rocketing gas prices.  Unlike fossil fuels, renewable energy resources like solar and battery storage have no fuel costs.