Alabama Public Service Commission: High power bills mostly accurate, billing errors rare

MONTGOMERY, Ala. — Complaints regarding exorbitant power bills are flooding ABC 33/40 News. Alabama Power has attributed the surge to the recent cold spell and increased usage. However, numerous customers remain unconvinced, asserting that their bills have tripled despite closely monitoring their thermostats during the freezing temperatures. Astonishingly, some bills have even surpassed $600 for a single month.

The Alabama Public Service Commission holds the responsibility of regulating rates for public utilities, which includes power and gas companies. The commission consists of three Republicans: Commissioner Twinkle Andress Cavanaugh, serving as the President; Commissioner Jeremy H. Oden, representing Place One; and Commissioner Chris “Chip” Beeker, representing Place Two.

The next commission meeting will take place on Tuesday, February 6. You can find the agendas for the meeting posted online, along with a link to watch it live. After the meeting, ABC 33/40 News reached out for an interview with commission members. However, they informed us that they are unavailable due to scheduled meetings.

The spokesperson responded in writing, attributing the high utility bills to the “punitive and radical energy policies of the Biden Administration.” They emphasized that customers are now burdened with unprecedented fuel costs, which are ultimately passed on to them, as a consequence of President Joe Biden’s aggressive stance against fossil fuels.

We reached out to the APSC to get more details about that statement.

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There are several primary factors that have led to the rise in electricity costs in recent years.

Inflationary pressures and the regular expenses of conducting business.

The cost of complying with the Federal Regulations and mandates set by the Biden administration, including those related to the environment and utility-specific requirements, is quite significant.

During 2022, the cost of natural gas experienced a significant surge, soaring from around $2.00/MMBtu to $10.00/MMBtu. As a consequence, there was an under-recovery of fuel costs amounting to approximately $600 million. This led to the need for Alabama Power to make upward adjustments to its fuel charge. Although natural gas costs have since decreased to the range of $2.30-$2.50, there is still an under-recovered amount of about $245 million that must be collected from customers as a through cost.

The cost has increased due to the implementation of new depreciation rates.

Some Alabama Power customers have been hit with significantly higher bills in the past few months.

ABC 33/40 News asked the Alabama Public Service Commission some additional questions.

Have you been receiving numerous complaints about power and gas bills?

Yes, we do receive calls on a monthly basis. Whenever the weather fluctuates drastically, the number of calls we receive tends to increase.

You can find the service inquiry totals in our monthly Commission meetings. To access the totals, simply refer to the monthly Commission meeting agenda by following the calendar dates highlighted in orange. The agenda for February will be available on the afternoon of February 2, 2024.

If you want to contest a bill, it is important to first communicate with your provider. However, if you are not able to reach a satisfactory resolution, you can take the next step by filing a complaint with the PSC.

If you are experiencing any billing issues or concerns with your utility provider, it is recommended to first try resolving them directly with the company. However, if you find that the informal process does not result in a satisfactory resolution, you have the option to seek assistance from the Alabama Public Service Commission (APSC). You can reach out to them at 1-800-392-8050 or submit an informal complaint on their website at psc.alabama.gov. The APSC aims to help consumers find an informal resolution to their billing problems. In the event that the informal process does not yield the desired outcome, consumers have the option to escalate the issue by filing a formal complaint with the Secretary of the APSC.

What does a typical schedule look like?

When a customer contacts our office, we promptly address their concerns and ensure a swift resolution. The response time may vary depending on the complexity of the issue at hand. Our aim is to handle complaints within the same day they are received. While we strive to efficiently manage informal complaints, formal complaints require a more extensive process, including the filing of a legal complaint and the possibility of a contested, evidentiary hearing in Montgomery.

Have you come across any recent cases where errors were discovered?

Billing errors are a rarity, with very few instances reported. In the unlikely event that a customer is charged incorrectly, we will promptly process a refund if deemed necessary.

A rate hike and a rate adjustment are two different terms used to describe changes in interest rates. While they both involve a change in rates, there are distinct differences between the two.

A rate hike refers to an increase in interest rates by a central bank or a financial institution. This is typically done to control inflation or to slow down economic growth. When there is a rate hike, borrowing money becomes more expensive, and it can have an impact on various sectors of the economy, such as housing, consumer loans, and business investments.

On the other hand, a rate adjustment is a broader term that encompasses both rate hikes and rate cuts. It refers to any change in interest rates, regardless of whether they are increasing or decreasing. A rate adjustment can be made for various reasons, including changes in economic conditions, monetary policy decisions, or market factors.

In summary, the main difference between a rate hike and a rate adjustment is that a rate hike specifically refers to an increase in interest rates, while a rate adjustment is a more general term that includes both rate hikes and rate cuts.

Rate adjustments can refer to both increases and decreases in rates. The Commission ensures that neither Alabama Power nor Spire can earn additional profits beyond what has been approved. In December 2023, Alabama Power implemented a rate adjustment, resulting in refunds to its customers.

When were the last rate hearings held for Alabama Power and Spire Energy?

Both Alabama Power and Spire operate under the regulations of Rate Stabilization and Equalization (RSE) mechanisms. In accordance with these mechanisms, both companies submit annual rate filings based on their budget projections. These filings undergo a thorough review by the Commission and may be adjusted before they are implemented. The RSE mechanisms enable the Commission to closely monitor the day-to-day operations of each company.

If you have any additional useful information that can assist the public in dealing with bill payment difficulties, please send it over.

The Commission is set to address the issue of granting Alabama Power consumers greater flexibility in meeting their recent billing obligations during the upcoming Commission meeting on February 6, 2024. We have received confirmation from Alabama Power that they will refrain from disconnecting anyone’s power due to nonpayment until after March 15. Additionally, in order to assist customers, Alabama Power will be extending their call center hours this week, operating until 9 p.m. instead of the usual 7 p.m.

The media has primarily been focused on Alabama Power bills, but we wanted to hear from Spire Energy about the feedback they have been receiving from their customers.

The extreme cold that Alabama experienced in January resulted in increased energy consumption by customers to heat their homes. Consequently, this higher energy usage can lead to higher-than-usual bills.

To clarify, the increase in bills that customers are noticing is not due to changes in rates. In fact, the Alabama Public Service Commission approved new rates that actually reduce the annual bill for the average residential customer by approximately 4%, starting from January 1. The higher bills that some customers may be experiencing are more related to weather conditions and increased usage rather than changes in rates.

If customers have any concerns about their bills, we encourage them to contact us.

Budget billing is an excellent choice for customers who want to have a consistent monthly energy bill. This option evenly distributes energy usage over time, ensuring that customers won’t experience unexpected bill fluctuations during colder months.

We understand that for certain customers, an increase in their bill can pose financial challenges. At Spire Energy, we offer assistance programs specifically designed to support customers in such situations. We encourage our customers to visit our website at spireenergy.com/assistance to explore the available options. Rest assured, we are always ready to provide the necessary help and support.

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