Alabama PSC Review Process Results in No Improved Transparency or Rate Benefits

August 16, 2013 — The Alabama Public Service Commission (PSC) this week voted to change the way it regulates the Alabama Power Company’s rates. The decision follows informal meetings that resulted from growing criticism of its ineffective, secretive oversight of Alabama Power Company and its high electricity bills. However, the PSC’s decision came without providing the public data to support the decision, and any real relief in rates is highly questionable.

During these informal meetings, the PSC sharply limited the scope of the issues available for discussion, refused numerous requests that Alabama Power provide information on its operations that affect rates, and did not require the company to testify under oath.

“This hastily announced outcome is disappointing and these proceedings clearly lacked the transparency that Alabama citizens deserve,” said Keith Johnston, managing attorney of Southern Environmental Law Center’s Birmingham office. “It’s nothing more than a token gesture that may or may not provide savings to ratepayers — to say nothing of addressing the larger deficiencies with the PSC’s oversight process.”

The adjustment decision might minimally lower the rate of return Alabama Power is allowed to gain, but it remains well above the national average and several experts, including one of three public service commissioners, have questioned if it will result in any savings for ratepayers.

“Given the many issues that have come to light in recent months, we deserved a real solution from our elected officials who are supposed to protect the interests of ratepayers,” said Amelia Shenstone of Southern Alliance for Clean Energy. “Instead we got a continued charade where any promised rate savings seem questionable at best, and a broken system that offers no transparency or accountability remains in place.”

Under the adopted adjustments, every meaningful regulatory decision will continue to be made behind closed doors, out of the public’s sight. There is no guarantee of significant public review of the reasonableness of the annual expenditures or investments made by Alabama Power. In addition, the resolution means the door is closed for further discussion on how rates are set for at least the next six years.

“Tuesday’s PSC vote does nothing to alter our concern that the cozy relationship between Alabama Power and elected officials is unfair to Alabama ratepayers,” said Stacie Propst, executive director of GASP. “Spending decisions that affect Alabamians’ quality of life — both through the air we breathe and the rates we pay for electricity — deserve legitimate scrutiny.”