By Lina Irawan 
On a bustling election day in Alabama, the state’s Public Service Commission (PSC) took a significant step toward consumer protection, formally requesting that Alabama Power, the state’s largest electricity provider, immediately cease billing customers for its extensive television commercials and other promotional advertisements. This move, initiated by PSC President Cynthia Lee Almond, aims to accelerate a new state law set to take effect in 2029, which will prohibit such practices. The decision comes as Alabama prepares for a dramatic restructuring of its utility regulatory body, promising a new era of energy policy and oversight.
Alabama Power, a subsidiary of Southern Company, holds a monopolistic grip on electricity provision for approximately two-thirds of Alabama, serving over 1.5 million customers. Despite its unchallenged market position, the utility annually pours millions into advertising campaigns, extolling its reliability, customer service, and community involvement. In recent months, these campaigns have prominently featured the company’s "rate freeze," a measure announced late last year amidst a torrent of criticism over persistently escalating electricity prices that have left many Alabama residents struggling with some of the highest utility bills in the nation. The company’s strategy has often been seen as an attempt to shape public perception and mollify discontent, even as consumers bear the financial brunt of these promotional efforts.
Currently, Alabama Power is legally permitted to pass on half of its non-public safety advertising costs directly to its customers, embedding these expenses within their monthly electric bills. This practice, common among regulated utilities in some states, has long been a point of contention for consumer advocates who argue that customers of a monopoly should not be forced to subsidize a company’s image-building, especially when they have no alternative provider. The new state law, enacted earlier this year following considerable public and legislative pressure, explicitly addresses this issue by mandating that Alabama Power cover all advertising costs from its corporate profits, rather than ratepayers. However, the law’s delayed implementation until January 1, 2029, has been a source of frustration for those seeking immediate relief.
During Tuesday’s PSC meeting, President Cynthia Lee Almond seized the opportunity to push for an earlier cessation of the practice. "I don’t see any reason why we shouldn’t go ahead and take steps now to begin that process, rather than waiting until Jan. 1, 2029,” Almond declared. Her motion, an unscheduled item introduced after the commission’s regular electricity division report, called for Alabama Power to "consent to exclude all advertising expenses from retail rate setting until after Dec. 31, 2028, when the new law takes effect." Almond further clarified that, should Alabama Power agree, "this interim measure would be reflected in its [Rate Stabilization and Equalization] filings for 2027 and 2028." The Rate Stabilization and Equalization (RSE) mechanism is a controversial formula that allows Alabama Power to automatically adjust rates based on certain financial metrics, often without full public scrutiny, making it a critical avenue for implementing such cost exclusions. Commissioners Jeremy Oden and Chris Beeker IV swiftly voted in favor of the motion after a brief deliberation, sending a clear signal of the commission’s intent.
According to filings with the Federal Energy Regulatory Commission (FERC), Alabama Power’s general advertising expenditures exceeded $6 million last year. This translates to an average of roughly $4 per customer across its service territory. While the exact portion of this total directly passed on to customers or the precise impact of the new prohibition remains to be fully quantified from these federal filings, the commission’s request targets the substantial sum that ratepayers currently shoulder. If Alabama Power complies, the direct savings per customer, though seemingly modest on a monthly basis, would collectively amount to millions of dollars annually that can instead remain in the pockets of Alabama families and businesses. As of the time of reporting, Alabama Power had not yet responded to requests for comment regarding the PSC’s directive.
The move was met with enthusiastic approval from consumer advocacy groups. Daniel Tait, executive director of Energy Alabama, a non-profit organization dedicated to advancing clean energy and consumer interests, lauded the commission’s action. "We are grateful for the leadership of President Almond and the full commission for acting to end customers paying for Alabama Power’s advertising," Tait stated. He emphasized the significance of the decision, adding, "Once in place, Alabama will have one of the strongest customer protections in the nation on this front." Tait’s organization has been a vocal critic of Alabama Power’s rate structures and its extensive advertising, arguing that such expenditures are inappropriate for a monopoly and contribute to the state’s notoriously high energy costs. The average residential electricity bill in Alabama has consistently ranked among the highest nationally, prompting widespread calls for greater regulatory oversight and accountability from the utility.
This pivotal decision marks one of the final actions of the Alabama Public Service Commission under its current, three-member configuration, as the state prepares for an unprecedented overhaul of its energy regulatory landscape. In January, the commission is set to expand dramatically from three to seven members, a legislative change prompted by growing concerns over the PSC’s effectiveness, transparency, and its ability to adequately protect consumer interests against the powerful influence of the state’s largest utility. This expansion is part of a broader legislative package aimed at modernizing Alabama’s energy governance.
Outgoing Governor Kay Ivey has already appointed four new commissioners to fill the expanded seats, introducing a new level of diversity to the regulatory body, including the PSC’s first-ever Black members. This infusion of new perspectives is anticipated to reshape the commission’s dynamics and potentially its approach to utility regulation. Concurrently, Commissioners Jeremy Oden and Chris Beeker IV, who both voted in favor of Almond’s motion, will depart the commission in January, having been defeated in Republican primaries. Their seats will be filled by Cullman County Sheriff Matt Gentry (Place 1) and former state auditor and PSC Commissioner Jim Zeigler (Place 2).
The return of Jim Zeigler to the commission is particularly noteworthy. A perennial figure in Alabama politics for several decades, Zeigler will resume his role on the PSC nearly half a century after his initial term from 1975 to 1979. His previous tenure was characterized by an era of significant energy cost volatility and intense political clashes over electricity rates between Alabama Power and the formidable then-Governor George Wallace. Zeigler’s re-entry brings a wealth of historical context and a reputation as a populist watchdog, suggesting that the new commission might adopt a more assertive stance on consumer advocacy and utility oversight, potentially drawing parallels to the regulatory battles of the past. Cynthia Lee Almond will be the sole remaining member from the current commission, providing a thread of continuity amidst profound change.
Adding another layer of complexity and power shift to the new structure, the expanded seven-member commission will operate under the guidance of the state’s first Secretary of Energy. This secretary will be appointed by Governor-elect Tommy Tuberville, who is poised to take office in January. The creation of this new cabinet-level position is a fundamental re-imagining of Alabama’s energy governance, centralizing significant authority. The Secretary of Energy will be responsible for setting the commission’s agenda, and any attempt to overrule the secretary will require a supermajority vote of five out of seven commissioners. This structure is designed to streamline decision-making and potentially align the commission’s priorities more closely with the executive branch’s energy policy vision, but it also raises questions about the balance of power and the independence of regulatory oversight.
Governor-elect Tuberville has not yet announced his selection for this critical role. The only statutory requirement for the position is that the individual "must have experience in utility regulation or energy policy or a related field." The choice of Secretary of Energy will be highly scrutinized, as it will undoubtedly signal the future direction of Alabama’s energy landscape, influencing everything from electricity rates and renewable energy development to climate policy and consumer protections. The incoming administration, coupled with a dramatically reshaped PSC, is set to usher in an era of unprecedented change and potential volatility for Alabama Power and its millions of customers. The PSC’s proactive move on advertising costs, therefore, serves as an early indication of a potentially more assertive regulatory environment on the horizon.
