The Alabama Public Service Commission said in a statement that the rate adjustments are appropriate based on the figures that Alabama Power provided.
Published: Aug. 29, 2024, 5:34 p.m.Alabama Power is paying less for power generated by third-party energy producers and imposing a cost for those companies to connect to its electricity grid.
“It is 100% about control,” said Steve Cicala, associate professor of economics at Tufts University, whose work focuses on the economics of regulation, particularly with respect to environmental and energy policy. “They are a business — and they don’t want competition.” Both Energy Alabama and the Southern Renewable Energy Association, another group that promotes the responsible use of alternative energy, sought to challenge the PSC’s ruling, but the PSC officially denied their request in a written order on July 22.
“While every solar project has different economic requirements, lowering the price a solar project receives or adding additional fees likely means fewer projects will get built, less investment in communities that would host those projects, few jobs in building those projects, etc,” he wrote in an email.
Throughout the country, Pierpont said, power distribution companies like Alabama Power have been working to reduce the amount they pay homeowners who contribute electricity back to the grid through rooftop solar panels. In 2012, the PSC approved an Alabama Power request to impose a $5 per kW Capacity Reservation Charge on customers with solar panels, often known as a rooftop fee. Typically, households that generate about 5 kW on their solar array will pay about $300 annually, or $9,000 over the 30-year expected lifespan of the system.Power companies in other states have been allowed to impose such charges, including Arizona.
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