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September 23, 2008   Email to Friend 

MOTION PROMPTS ALABAMA POWER TO SCALE BACK PROPOSED RATE HIKES
Darryal Ray
(334) 613-4187
September 23, 2008

MONTGOMERY, Ala. -- The Alabama Farmers Federation filed a motion on Friday to intervene in the Public Service Commission's hearing on a proposed rate hike from Alabama Power Company, saying that the proposed rate increases could be "devastating" to farmers, especially poultry and catfish producers.

The Federation's motion, coupled with similar motions from industry, prompted Alabama Power today to scale back on its proposed rate increases. The utility company, which had sought raising residential rates by 14.6 percent, will now seek an 8.24 percent increase. It also reduced its proposed rate increases from 24.8 percent to 14 percent for industrial users and from 16 percent to nine percent for commercial businesses.

The PSC's decision could come at its Oct. 7 meeting. If approved, the rates would go into effect Oct. 9.

PSC President Jim Sullivan, along with Commissioners Jan Cook and Susan Parker, will review the information presented in today's hearing before making a final decision. The three responded sympathetically to the needs of Alabama farmers and promised to evaluate any increase and the negative impact it would have on Alabama agriculture.

"Over the years, Alabama Power has worked cooperatively with Alabama farmers, including the approval of off-peak rates that helped catfish farmers aerate their ponds and other farmers to irrigate their fields," said Paul Pinyan, director of the Federation's department of governmental affairs. "However, Alabama Farmers Federation members are concerned that this proposed rate increase is too large and needs additional analysis and deliberation before rushing to approval. The result of a large rate increase could be devastating to farmers, especially poultry and catfish producers across the state."

Pinyan said the motion to intervene is intended to ensure that the proposed rate increases are warranted, and if so, are implemented in a "fair and reasonable manner." Furthermore, he said, any rate changes should also provide for relief to consumers if energy costs go down in the future.

"Agriculture is Alabama's largest industry and affects literally every citizen in the state," said Pinyan. "Now, Alabama farmers are experiencing unprecedented input costs. Energy expenses, while always a significant share of costs, have increased at double-digit percentages."

The Alabama Farmers Federation is the state's largest farm organization with 460,000 members across Alabama.




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