As New Data Center Law Takes Effect October 1, Alabama Still Needs Real Guardrails and a Public Vote

From the Karlapalem campaign

September 30

Hanu Karlapalem says redacted Alabama Power contracts and proposed automatic approval show why Alabama needs a moratorium, binding community benefit agreements, transparency, accountability, environmental impact reviews, and ratepayer protections

MADISON, Alabama - Hanu Karlapalem, Democratic nominee for Alabama State House District 4, said today that Act 2026-610 (Senate Bill 270), the new state law on data center power costs, takes effect October 1, but the public still cannot see the contract terms that decide whether families will pay. He renewed his call for the guardrails he has already put forward: a one-year moratorium on new AI data center approvals, binding community benefit agreements, full transparency in contract terms, real accountability, environmental impact reviews, and explicit ratepayer protections.

Alabama Power has told regulators that its data center contracts will not raise electric bills for everyday Alabamians. But the public copies of the three data center contracts it has filed with the Public Service Commission this year have the contract length, minimum bills, pricing, and even the names of the signers redacted, so the public has no way to verify that claim. Alabama Power has also proposed a rate schedule under which contracts would be approved automatically after 45 days, without a vote of the Commission. And contracts filed before October 1 are reportedly exempt from the new rules under an agreement Alabama Power reached with the Commission in July, which means the three contracts already on file may not be covered by the law taking effect October 1.

"You cannot ask Alabama families to trust a promise you will not let them read," Karlapalem said. "A new law is a good start, but a law only protects ratepayers if the public can see the deal and elected commissioners vote on it in the open. If a deal is good for ratepayers, prove it."

THE GUARDRAILS

• One-year moratorium. A pause on new AI data center approvals in Alabama while protections are put in place.

• Binding community benefit agreements. Negotiated with host communities before a project moves forward.

• Transparency. Full disclosure of contract terms that could affect ratepayer costs.

• Accountability. Real consequences for the companies involved when commitments are not met, and a public vote by commissioners on large contracts.

• Environmental Impact reviews. Independent review of a project’s effects on water, air, and energy use before approval, with the results made public.

• Ratepayer protections. Explicit protections so data center costs are never passed on to families and small businesses.

In July, Karlapalem publicly backed former U.S. Senator and Democratic nominee for Governor Doug Jones' call for a data center moratorium. Hanu Karlapalem has spent months warning that unchecked hyperscale AI data center growth threatens to strain Alabama's power grid and drive up costs for residents, a concern shared by the NAACP's Stop Dirty Data Centers campaign.

"Growth and honesty are not opposites," Karlapalem said. "We can bring real investment to North Alabama without asking residents to sign a blank check and hope for the best."

Karlapalem is calling on the Public Service Commission to require full public disclosure of any data center contract terms that could affect ratepayer costs, and to vote in public on each large data center contract rather than leaving approval to staff or automatic timelines.

Hanu Karlapalem is a Madison, Alabama resident of 26 years, small technology business owner, UAH M.S. graduate, Life Member and former Second Vice President of the Limestone County NAACP and Chairman, AANHPI Caucus. He has been married for 31 years and has deep roots in the North Alabama community through civic, professional, and community service. Karlapalem is the Democratic nominee for Alabama State House District 4 in the November 3, 2026, general election.

For more information: https://www.hanu4alabama.com.