Alabama Power Commits to Steady Rates Through 2027

Rhea-AI Summary

Alabama Power (NYSE:SO) said it will keep all regulated retail rate components steady through 2027, providing customers predictability while continuing investments in grid reliability. The company delayed implementation of previously approved adjustments for the new Lindsay Hill generation facility until 2028 and will absorb that facility's costs in 2027 rather than deferring them. Alabama Power noted it has reduced operating expenses by about $100 million since 2017 and will continue efficiency and storm-resilient infrastructure investments. Customers may still see bill changes based on usage; assistance tools are available at alabamapower.com/save.

Positive

• Commitment to hold all regulated retail rates steady through 2027
• Will absorb Lindsay Hill facility costs in 2027 (no deferral to customers)
• Operating expenses reduced by $100 million since 2017

Negative

• Absorbing Lindsay Hill costs in 2027 may pressure near-term cash or margins

Insights

Utility finance and regulatory analyst

Alabama Power will keep all regulated retail rate components unchanged through 2027, absorbing near‑term acquisition costs.

Alabama Power commits to holding customer rates steady through 2027 by leaving all existing rate factors in place and delaying the previously approved adjustments tied to the Lindsay Hill generation facility until 2028. The company explicitly states it will absorb the newly acquired facility's costs in 2027 rather than deferring or shifting them to customers, and it cites about $100 million of operating‑expense reductions since 2017 as part of its cost base management.

The plan’s mechanics rely on the company’s stated ability to fund the Lindsay Hill costs internally and on continued cost control. If those internal offsets weaken, the company may face pressure to revisit rate assumptions or accounting treatment after 2027. Important dependencies include the actual 2027 cash impact of the facility, any regulatory actions that reopen rate design, and the persistence of stated operating‑expense savings.

Watch for concrete metrics and dates: the postponed Lindsay Hill adjustment in 2028, reported 2027 cash outflow tied to the facility, and updates to operating expense trends. Expect useful signals around the next regulatory filings and any public disclosure of the 2027 cost absorption mechanics within the next 12–18 months.

Multi-year rate stability plan provides certainty for customers
while company focuses on efficiencies and grid investments

BIRMINGHAM, Ala., Dec. 2, 2025 /PRNewswire/ -- Following today's Alabama Public Service Commission meeting, Alabama Power announced its commitment to keep customer rates steady through 2027 while maintaining the dependable service customers count on. All components of Alabama Power's regulated retail rates are not scheduled to increase through 2027. 

"We know budgets are tight, and power bills are a real concern for many families and businesses," said Moses Feagin, Alabama Power's executive vice president, chief financial officer and treasurer. "This commitment gives customers more certainty and predictability around electric rates at a time when many other household and business costs are rising." 

Alabama Power will hold in place all existing factors in customer rates, including delaying until 2028 the implementation of previously approved adjustments for the Lindsay Hill generation facility. As part of the commitment to keeping rates steady, the company will absorb the newly acquired facility's costs in 2027 rather than deferring or shifting those costs to a later date. 

"Since 2017, Alabama Power has reduced operating expenses by about $100 million despite the cost of equipment, such as transformers, poles and wires, increasing significantly during this time," Feagin said. "We will not waiver in our efforts to strengthen the energy grid and invest in smart, storm-resilient infrastructure, so customers receive the reliable service they deserve in communities across our state." 

While rates will remain level through 2027, bills could still go up or down based on the amount of electricity a customer uses each month. To help customers manage their bills, Alabama Power is pairing rate stability with tools and assistance. These include the company's Bill Explainer, Rate Advisor, Energy Assistant, Budget Billing and payment assistance programs that help customers better understand their bill, choose options that fit their needs and find help when they need it. 

For more information about tools to help manage power bills, visit alabamapower.com/save. 

About Alabama Power 

Alabama Power, a subsidiary of Atlanta-based Southern Company (NYSE:SO), provides reliable electricity to 1.5 million customers across the state. Learn more at alabamapower.com. 

View original content to download multimedia:https://www.prnewswire.com/news-releases/alabama-power-commits-to-steady-rates-through-2027-302630887.html

SOURCE Alabama Power Company

FAQ

What does Alabama Power (SO) mean by keeping rates steady through 2027?

All components of Alabama Power's regulated retail rates are not scheduled to increase through 2027, providing price predictability for customers.

How will the Lindsay Hill generation facility affect Alabama Power (SO) rates and timing?

Implementation of previously approved Lindsay Hill rate adjustments is delayed until 2028, and the company will absorb the facility's costs in 2027.

Does rate stability mean my Alabama Power (SO) bill will not change monthly?

No; rates stay level through 2027, but individual bills can rise or fall based on each customer's monthly electricity usage.

What customer tools does Alabama Power (SO) offer to manage bills during the rate commitment?

Available tools include Bill Explainer, Rate Advisor, Energy Assistant, Budget Billing, and payment assistance programs at alabamapower.com/save.

How significant is Alabama Power's reported expense reduction for investors in SO?

The company reports operating expenses have fallen by about $100 million since 2017, reflecting ongoing efficiency efforts.