PSC Asks Alabama Power to Drop Ad Costs From Bills

TL;DR: Alabama regulators voted 3-0 to ask Alabama Power to stop passing advertising costs to customers before a 2029 State restriction begins. The request depends on the company’s consent, and the amount customers could save remains unclear.

Alabama’s Public Service Commission wants Alabama Power to stop charging customers for its advertising before a new State law requires that change in 2029.

The Commission voted 3-0 on Nov. 3 to seek the company’s consent. PSC President Cynthia Almond offered the motion, with Commissioners Jeremy Oden and Chris Beeker joining her.

The vote was a request. It did not, by itself, end the practice.

According to Inside Climate News, Almond’s motion seeks to exclude all advertising expenses from retail rate setting through Dec. 31, 2028. If Alabama Power agrees, the change would be reflected in its 2027 and 2028 Rate Stabilization and Equalization filings.

Those filings help set the company’s retail rates.

Under the current arrangement, Alabama Power may recover half its non-safety advertising costs from customers. The expense is included in rate calculations, rather than presented as a separate advertising fee.

The Alabama Legislature’s final version of HB 475, known as the Power to the People Act, sets Jan. 1, 2029, as the start of the new cost limits.

From that date, regulated electric utilities may not include advertising costs when calculating new or changed rates, except for public safety advertising approved by the PSC. The law also excludes certain lobbying costs and outside funding or grants that affect rates.

Utilities must affirm that their rate filings omit the barred costs. Without that Statement, the rate or service rule is void. If the PSC finds prohibited costs in a rate calculation, the law requires an investigation.

The Commission’s request goes further for the period before 2029: it seeks to exclude all advertising expenses.

The dollar impact remains unclear. Inside Climate News reported that Alabama Power’s federal filings showed more than $6 million in general advertising spending in 2025. Those records did not establish how much customers paid or how much the proposed change would remove from rates.

The outlet also reported that Alabama Power had not responded to its request for comment. No public acceptance of the PSC’s request was found in reporting reviewed through Nov. 6.

The vote drew praise from Energy Alabama, which welcomed the move in a Facebook post.

“The Commission put Alabamians first,” the group wrote.

“Now it’s Alabama Power’s move,” the post continued. “If Alabama Power consents now to stop billing customers for ads before 2029, it can still advertise. It just has to pay for the advertising out of its other money and not charge it to customers.”

Several significant questions remain unanswered as of this writing:

• Will Alabama Power consent, and when would the change take effect?
• How much advertising expense has the company recovered from customers each year?
• Which campaigns were included, and how were the costs divided?
• Would removing those expenses lower rates, produce bill credits or affect future rate calculations?
• What standards will the PSC use to approve safety advertising after 2028?
• If Alabama Power declines, what steps will the Commission take next?

Energy Alabama has pledged to press for answers if the company declines.

“If Alabama Power does not agree to the Commission’s request, then customers deserve to know why,” the group wrote. “And we will ask the Commission to provide answers and to take further action to protect customers from paying the costs of Alabama Power’s advertising.”