Members of the Alabama Public Service Commission prepare for the Tuesday, August 5, 2025 regular meeting. PSC President Cynthia Almond said Tuesday the commission is preparing to implement a new law expanding the commission to seven members. (Ralph Chapoco/Alabama Reflector)
The president of the Alabama Public Service Commission said Tuesday the utility regulator is preparing to comply with a new law that expands the PSC and will eventually put it under the supervision of a secretary of energy.
PSC President Cynthia Almond, a former House member, said after the PSC’s meeting that staff will meet with commissioners Wednesday ahead of the first phase of the law, directing Gov. Kay Ivey to appoint four new commissioners from a list of nominees submitted by legislative leaders. Ivey will have to do so by July 15.
“We are a commission created by the Legislature initially, and we can be amended, changed, abolished, at any point by the Legislature,” Almond said in an interview following the Tuesday regular meeting. “Whatever the Legislature chooses to do, we will abide by.”
The bill will also change the structure of the commission. The PSC currently consists of three members – Almond and two commissioners, Jeremy Oden and Chris Beeker – elected statewide. Under the bill, each of the seven PSC members will be elected from one of the state’s seven congressional districts in a process that will go through 2030.
“We have got four new commissioners coming in; where are we going to put them?” Almond said in the interview. “We are trying to figure out if we are going to move us as a body to another building or is there room here to reorganize and squeeze in here on the two floors that we have.”
Gov. Kay Ivey signed HB 475, sponsored by Rep. Mack Butler, R-Rainbow City, last week.
The bill moved through both the House and Senate rapidly in the waning days of the session. Butler’s legislation initially required the PSC to convene a rate case every three years to decide the appropriate rate that public utilities, particularly Alabama Power, should charge customers.
Renewable energy advocates had been clamoring for a rate case, which the PSC has not held since 1981.
The House unanimously approved a version that was largely unchanged from the one that Butler filed in mid-March. However, the Senate Fiscal Responsibility and Economic Development Committee approved a substitute that dramatically altered the legislation. The bill incorporated all the elements of another bill, SB 360, sponsored by Sen. Clyde Chambliss, R-Prattville, that prohibited investor-owned utilities, like Alabama Power, from increasing the base rate on customers until 2029, which extended the freeze that the PSC ordered in December that would have expired in 2027.
However, it also allowed the governor’s office to appoint four new members while phasing in the elections to replace her appointments until 2030. SB 360 also created the secretary of energy, a cabinet-level post, to oversee the agency and control the meeting agenda unless five of the seven commissioners on the body vote to amend it.
The bill from Chambliss also stated that the PSC can convene a rate case only after 2029, and only if the secretary of energy orders one or if five of the seven members agree to have one.
The final version of HB 475 passed over Butler’s objections.
Almond Tuesday defended the current process of Rate Stabilization Equalization, which guarantees utility companies a profit in lieu of convening a rate case on a recurring basis.
“I am new, trying to figure it out,” she said at first. “We have a different process number one. Our staff thinks our process works well, and it is really set up to have more modest increases over time rather than setting a rate, waiting three years, and having another 18% increase that causes havoc with people’s power bills.”
Renewable energy advocates said convening a rate case does not necessarily guarantee that utility rates will increase.
“If you look at cases across the country, that is probably what you find,” Almond said. “They have the opportunity to present their case and show that there is a justification for a rate increase, that is what the PSC judge goes by. There is another side, so it could go up or it could go down.”
Almond also said the rate freeze will help customers with the price of electricity.
“We are going to be much better positioned, obviously,” she said. “We are already pretty well positioned nationally; we are about the middle of the pack. But in the Southeast, we are one of the highest. I don’t think we will be after the rate freeze.”
John Free, director of the electricity policy division, defended the work of the staff when he presented the current RSE and the energy cost recovery rate.
“There is the RSE formula, so there are numerous accounting schedules and supporting documents that are provided each month by Alabama Power to the commission staff,” Free said. “From those accounting schedules, which are the books of record of Alabama Power, those numbers are then inserted into the formula, which is broken down into numerous line items, that when you aggregate them, would go back into the formula itself.”
Free said Alabama Power’s books were reviewed in “a very continuous process.”
Almond said that the PSC will implement the changes and work with the incoming commissioners. She also characterized the comments from consumers and renewable energy advocates in the media as unfair.
“My observation, just having been here nine months, is that we have a very skilled, hardworking staff, who come to work every day who try to do a good job on behalf of the rate payers of Alabama.”
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Author: Ralph Chapoco