News | June 15, 2021

FERC decision clears way for action against Alabama Power’s unjust solar charges

A decision by the Federal Energy Regulatory Commission opens the door for our case against Alabama Power’s punitive monthly solar fee to go to federal court.

The federal agency declined to hear a petition to initiate an enforcement action against the Alabama Public Service Commission for allowing Alabama Power to impose unjust charges against its customers with rooftop or on-site solar.

The petition was filed by SELC and Ragsdale, LLC on behalf of Birmingham-based nonprofit GASP and four Alabama Power customers who installed solar on their properties. Alabama Power has been charging them an extra fee, to supply electricity if solar panels don’t produce enough.

Alabama Power imposes one of the highest fees on residential solar customers of any investor-owned utility in the nation — which can double the time it takes a customer to recoup an investment in a solar installation. The fees alone add about $9,000 to the total price tag over the lifetime of an average 5-kilowatt system, costing residents about half the savings they should expect from shifting to solar. For a typical resident with a 5-kilowatt solar system, the solar fee and a base charge add up to an electric bill of $41 before using a single watt of electricity delivered by Alabama Power.

This unjust fee has hamstrung the growth of solar power in Alabama, even though the state has great solar potential. This not only robs Alabama residents of access to clean, renewable energy, it has cost the state thousands of solar-related job opportunities and corresponding economic growth.

FERC’s decision to decline the petition was expected since the agency typically doesn’t initiate such enforcement actions. But it was necessary to go through that process before petitioners could take their case to federal court. Two FERC commissioners issued a concurring statement highlighting their concern that the state commission may be violating federal law by discouraging rooftop or on-site solar growth in Alabama.

“We are pleased that Chairman Glick and Commissioner Clements recognize the apparent illegality in how Alabama Power, with the full support of the Alabama Public Service Commission, is treating customers who make private investments in rooftop or customer-sited solar,” said Keith Johnston, director of SELC’s Alabama office. “We are now prepared to take the next step of seeking relief from a federal district court so that Alabama Power customers can finally reap the benefits of solar just like customers in other solar-rich states.”