By Ralph Chapoco, Alabama Reflector
An Alabama representative has filed a bill that would require the state’s Public Service Commission, Alabama’s public utility regulator, to host public hearings with companies to discuss rates and their operations.
HB 475, sponsored by Rep. Mack Butler, R-Rainbow City, comes amid mounting concerns over Alabama’s high utility rates and after an attempt earlier this month to end PSC elections. Butler’s bill would require the PSC to host a meeting each year to discuss how it will regulate the utility companies it oversees and other topics within the agency’s authority.
The bill would make failing to hold the meetings grounds for impeaching PSC commissioners, though impeachment itself would be a decision for the Alabama House. The bill would also prohibit utility companies, including Alabama Power, from passing the costs they incur for their lobbying efforts, advertising and grants they provide to their customers.
“The PSC has not had a rate hearing in 44 years, and we are paying the highest (electric utility rates) in the region,” Butler said in an interview on Monday. “I think we are the third highest in the nation, 40% more than Tennessee Valley Authority.”
The bill, filed as the Legislature hits the midway point of the 2026 regular session, comes a few weeks after Rep. Chip Brown, R-Hollinger’s Island, filed HB 392, which authorizes the governor to appoint the president of the PSC, and associate commissioners from a list of candidates selected by the speaker of the Alabama House of Representatives and the Alabama Senate president pro tem.
Brown’s legislation was pulled before a vote on Feb. 12 amid public criticism and questions over whether the bill had the votes to pass the Senate. But the bill, like Butler’s, also required the Public Service Commission to host hearings for public utilities such as Alabama Power to discuss utility rates and how they are related to the business operations of the company.
Brown’s legislation states that utility companies will provide information on “issues affecting its operations, such as cost trends, reliability, and other regulatory issues the commission deems relevant.”
Butler said Monday that the leak of a recorded phone conversation between John Dodd, policy manager for Energy Alabama, a nonprofit that advocates for more renewable energy use in the state, and R.B. Walker, director of state and federal affairs for Alabama Power, was an impetus for the bill. In the recording, Walker encourages Dodd to consider supporting Brown’s bill while saying the utility would be publicly neutral about it.
“It infuriated the public,” Butler said. “I believe that Chip (Brown) had honest intent because of what happened in Georgia. But there was backlash from the public, especially after that tape. The job of the PSC is to look out for the people, not for the utility.”
A message was sent to Alabama Power on Monday seeking comment.
HB 475 states that the PSC will host hearings to discuss “rates, cost trends, reliability, resilience, general infrastructure investment plans, competitiveness with peer states, economic development impacts, and other regulatory issues the commission deems relevant.”
The bill also states that public utilities such as Alabama Power cannot increase customers’ electricity rates for expenses related to lobbying, grants that it provides or for advertising.
The legislation does not expressly overturn a process known as Rate Stabilization Equalization, which allows companies such as Alabama Power to submit their request for a specific rate of return along with supporting documentation. The PSC can then either accept or reject the proposal without a rate case that allows the public to review the evidence and respond to the request for a specific rate of return by the public utility.
Utilities are permitted to receive a guaranteed rate of return from capital expenditures with approval from the PSC while also recouping the costs associated for their operations. The process has been used since 1982, and critics say it keeps the reasons for rate increases unclear and locks out the public.
Energy Alabama Monday said it is neutral on the bill.
“Although it addresses transparency, transparency alone does not lower energy bills,” Dodd said in an interview on Monday. “In its current, written language, the bill does not require a formal periodic rate case with sworn testimony and a full evidentiary record. Without that, there is no guarantee that utility spending, rates and profit margins receive meaningful scrutiny.”
Butler, however, said that the bill requires a rate hearing that will accept input from the public.
“I am sure it will be all that,” Butler said. “We did not get all down into the weeds on that, but the bill definitely has rates. They (public utilities) have to be able to justify where they are at.”
Reprinted with permission
