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State Energy Efficiency Policy Database

Alabama

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Summary

Alabama has not historically administered utility-sector energy efficiency programs, and currently offers only very limited energy efficiency options. Alabama’s regulators have not encouraged or required the state’s sole investor owned utility (IOU), Alabama Power, to pursue energy efficiency and as a result, the utility has yet to implement a comprehensive set of programs. In contrast, TVA and its distribution utilities in northern Alabama are moving forward with increases in their energy efficiency programs. Cooperative utilities associated with the PowerSouth Energy Cooperative administer only a couple of efficiency programs.  Overall, Alabama Power and the cooperative utilities approach energy efficiency very skeptically.  The utilities invest far more on load management programs than energy efficiency programs. 

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables on the left.

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November 8, 2013


Customer Energy Efficiency Programs

A handful of utilities offer some small energy efficiency program offerings in Alabama, however the level of investments and savings from efficiency are far lower than the national average.  The Tennessee Valley Authority (TVA), a federally-regulated utility which provides electricity to 17 municipal and cooperative utilities in Alabama, offers the largest energy efficiency program offerings through participating partner utilities. The state's only regulated investor-owned utility, Alabama Power, and a few other cooperative utilities offer a couple of energy efficiency programs, however their demand-side investments focus mainly on load management rather than energy efficiency.

There are currently no natural gas efficiency programs in Alabama.

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables on the left.


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November 8, 2013


Alternative Business Models

Alabama Power and Alabama Gas Company can recover lost revenues by projecting losses and adjusting rates annually through Rate RSE. Rate RSE includes caps on rate increases and automatic rate reductions when profits or expenses exceed authorized ranges. The Commission opened a docket to consider additional policies, however both Alabama Power and Alabama Gas Company maintain that the integrated resource planning process combined with Rate RSE adequately address efficiency disincentives and the Commission opted not to adopt additional policies (See Docket No. 31045).


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August 9, 2013


Reward Structures for Successful Energy Efficiency Programs

Alabama Power and Alabama Gas Company may recover a reasonable rate of return on efficiency spending via a rate rider.


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August 9, 2013


Energy Efficiency as a Resource

There is currently no policy in place that treats energy efficiency as a resource, and no integrated resource planning (IRP) process in Alabama.


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August 8, 2013


Evaluation, Measurement & Verification

The Commission permits the rate recovery of energy efficiency programs that are cost-effective for all retail customers.


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July 31, 2014


Energy Efficiency Resource Standards

There is currently no EERS in place.

For more information on Energy Efficiency Resource Standards, click here.


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August 9, 2013