Alabama Power promises data center protections, but its proposed rate structure redacts them
Alabama Power is under scrutiny for redacting critical terms in data center contracts, preventing public and regulatory oversight of potential customer cost shifts. This issue is being deliberated by the Alabama Public Service Commission following a new state law. Local opposition to data centers has also intensified in the state, influencing municipal elections.
Alabama Power is facing criticism for withholding key financial and contractual details from the public regarding its agreements with large data center developers. Despite assuring regulators that these contracts protect other customers from bearing the costs associated with these projects, the utility has redacted crucial information such as contract length, minimum billing requirements, and pricing in its filings with the Alabama Public Service Commission (PSC).
The utility's proposed rate schedule, which would carry the force of law, notably omits any specific minimum term or bill percentage, contrasting with its public claims. The PSC initiated a proceeding (Docket 33709) after the Alabama Legislature passed SB 270, which mandates that data center contracts must recover incremental costs from the customer and benefit other retail customers. Alabama Power has filed at least three redacted data center contracts with the PSC this year, involving Dotier, LLC (a Meta subsidiary), Alabama ADC Holdings, LLC (an affiliate of Nebius), and Woostor, LLC.
The Office of the Attorney General has challenged the PSC's long-standing 'deemed-approved' process for contracts, arguing it may be illegal, while Alabama Power maintains its legality and insists on confidentiality. Other states like Indiana, Ohio, and Louisiana have publicly disclosed minimum terms and bill percentages for data center power contracts. While Alabama Power keeps these details private from the public and the PSC, its parent company, Southern Company, has openly discussed significant data center growth and associated capital costs with investors.
Local opposition to data centers has also gained momentum in Alabama. In Bessemer City, public backlash against 'Project Marvel,' a 1,200 MW data center campus developed by a QTS affiliate and owned by Blackstone, led to two incumbent city council members losing their seats and others facing tight races or runoffs in the August 2026 municipal elections. Mayor Kenneth Gulley, who defended the project, is also in a runoff against a candidate campaigning on the secrecy surrounding the deal.