Are Rates Going Up
Are Alabama Power rates going up? Here's what's happening through 2027
Rates are scheduled to stay steady through 2027. Bills can still change with usage. Here’s what affects your bill – and your options.
Short answer: Alabama Power’s regulated customer rates are not scheduled to increase through 2027. Your bill can still change based on usage.
Alabama Power has committed to keeping customer rates steady through 2027 under the Alabama Public Service Commission (PSC) framework. With rates held steady, most month-to-month bill changes come from usage – especially heating and cooling.
What to Know
- Alabama Power's retail rate is around the national average. More than 200 Southeast utilities charge higher rates, according to the federal EIA data (Table 10, 2024).
- “Steady rates” means regulated customer rates are not scheduled to increase through 2027 under the PSC-approved framework.
- Even with steady rates, bills can change based on usage – especially heating and cooling – plus items that vary under PSC-approved tariffs, like taxes and seasonal billing tier updates.
- When rates stay steady, the biggest lever most homes can control is usage. Start with small steps, then move to weatherization for a bigger payoff.
Quick Facts
- Month-to-month bill changes are driven mainly by how much electricity your home uses.
- More than 40% of a home utility bill goes to heating and cooling. (U.S. Department of Energy)
- Alabama homes use about 30% more electricity than the U.S. average. (U.S. Energy Information Administration)
- Alabama’s average residential bill ($173.50) is about 20% higher than the national average ($142.26), largely because of higher electricity usage. (U.S. Energy Information Administration)
Frequently Asked Questions
If rates are steady, why can my bill still change?
Even when rates stay steady, usage can rise when heating or air conditioning runs longer – and that’s what moves your bill. More than 40% of a home utility bill goes to heating and cooling. (U.S. Department of Energy)
Some bill items can also change under PSC-approved tariffs, like taxes and seasonal billing tier updates.
What’s the simplest way to take advantage of steady rates?
Lower usage where it counts most: heating and cooling. Start with quick steps – replacing filters, clearing vents and adjusting your thermostat – then weatherization for bigger impact.
How do I know which rate plan fits my household?
Use Rate Advisor to match your habits and goals to available rate options.
What’s the difference between a “rate” and a “bill”?
The rate is what one kilowatt-hour (kWh) costs. Usage is how many kWh your home uses. Month-to-month changes in your bill are driven mainly by changes in usage – especially heating and cooling.
Why do some sources say Alabama Power rates are the highest?
Some reports blur "rates" and "bills" as if they're the same thing. A rate is the price per kilowatt-hour. A bill reflects how much electricity your home actually uses. When usage rises – especially from heating and cooling – bills rise too, even if rates stay steady.
Does Alabama Power have the highest rates in the Southeast?
No. Alabama Power’s retail rate is around the national average. More than 200 Southeast utilities charge higher rates, according to federal EIA data (Table 10, 2024).
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Sources: U.S. Energy Information Administration (EIA); U.S. Department of Energy.
Last updated: January 2026