Some customers could see cheaper power rates
Some county residents will see a drop in their electric rates beginning in January following.
The Alabama Public Service Commission voted 2 to 1 this week to approve a new rate plan for Alabama Power customers.
A change in language in what determines customers rates from “return on equity” to “weighted cost of equity” was meant to save customers money, according to a release issued by Alabama Public Service Commission President Twinkle Andress Cavanaugh.
Alabama Power serves areas of southern Franklin County.
In a press release Tuesday, Cavanaugh said that the switch could equal a yearly savings of $30 to $110 for Alabama Power customers, based on a number of factors, including amount of electricity used, weather trends, rate classification and others. Cavanaugh estimated that most consumers who continue using the same amount of electricity would realize an average savings closer to the mid-point of the year.
However, Commissioner Terry Dunn, who voted against the change, said the switch would not make a difference in power bills.
Dunn issued a statement saying the change will allow Alabama Power’s profits to go higher.
“The public can be told it results in a small decrease in allowed return on equity today. … The problem is what it allows to happen tomorrow — and for years to come,” Dunn said in the news release.
Cavanaugh said Alabama Power’s customers “deserve some relief” in their electric bills.
“While Alabama Power Company felt their current rate structure was justifiable, our job as commissioners is to do what’s fair for all, and our hearings showed that consumers deserve some relief in the bills they pay,” Cavanaugh said.
Cavanaugh said the reduction occurred following a series of public rate review hearings conducted across the state, during which commissioners heard almost 24 hours of testimony from dozens of consumers, various interest groups, business owners, utility stakeholders, the Alabama Attorney General’s Consumer Division and others. The changes voted on Tuesday are slated to go into effect in January of 2014.
Public Service Commissioner Jeremy Oden, who also voted in favor of the reduction, issued a statement declaring it a victory for Alabama families.
“By adopting the PSC staff’s recommendation, we have lowered Alabama Power’s potential revenues by up to $65 million per year and ensured that electric rates will remain stable for both 2013 and 2014.”