Alabama Power Profits Soar as Utility Reform Bill Fails

Alabama Power reported $860 million in profit through the first two quarters of 2026, a 14 percent increase from the previous year. The investor-owned utility, a subsidiary of Southern Co., is on pace for a record $1.72 billion in annual profit according to a report by Inside Climate News.

A legislative push to reform the utility failed in the 2026 session despite initial momentum. Republican Representative Mack Butler's bill would have capped Alabama Power's profits and required its first formal rate case hearings since 1982.

The Legislative Push and Its Demise

Butler's bill passed the Alabama House of Representatives unanimously in March 2026. The legislation aimed to limit the company's political donations and restrict customer charges for expenses like advertising and lobbying. Butler, an electrician and electrical contractor, said he had secured informal agreements with key senators to advance a modified version.

The effort stalled. Political commentator and former state representative Steve Flowers attributed this to the utility's immense influence. "The power company has a tremendous amount of power with legislators," Flowers said. He noted the company gives generously to campaigns and communities, which "ingratiates them to everyone."

Democratic Representative Juandalynn Givan, who lost a primary election in 2026, said her colleagues knew their unanimous vote would be reversed. "You have legislators who are shaking in their damn boots, who are so worried about making sure they stay in favor with Alabama Power," Givan stated.

High Bills and a Regulatory Freeze

The reform effort gained traction amid public frustration over high electricity costs. An Inside Climate News analysis found Alabama Power's residential customers paid the highest total electric bills of any major U.S. Utility in 2024.

In December 2025, the Alabama Public Service Commission (PSC) approved a two-year rate freeze proposed by the utility. This postponed increases until 2028, including one related to a $622 million power plant purchase. That specific increase was slated to add $3.37 per month to the average customer's bill in 2027.

The freeze did not address the company's profit margin or long-standing transparency complaints about the PSC's regulatory process.

A Recorded Call and a Diverting Bill

In January 2026, a recorded phone call revealed Alabama Power's tactics. R.B. Walker, then the company's director of governmental affairs, called John Dodd, a lobbyist for the critical group Energy Alabama. Walker proposed that Energy Alabama advocate for a bill to make PSC commissioners appointed by the governor, rather than elected.

"I was thinking about it. You know, y'all could say bad stuff about us and we could say bad stuff about y'all in the press," Walker said on the call, which Dodd recorded. "But, you know...this might be in the best long-term interest of customers, which is probably the only thing that we can agree on."

Nine days later, Republican Representative Chip Brown introduced House Bill 392, which matched Walker's description. At a committee hearing, Brown claimed, without evidence, that Energy Alabama was funded by financier George Soros. Energy Alabama opposed the bill but did not initially release the recording of Walker's call.

The bill to change PSC elections ultimately died. The broader utility reform bill was gutted. Mack Butler reflected on the outcome without anger. "That's just how it goes in the Legislature sometimes," he said.