Alabama Power Rates To Drop By More Than 2 Percent

PHILLIP RAWLS

MONTGOMERY, Ala. (AP) — Alabama Power Co. customers are going to see a slight reduction in rates, starting next week, thanks to declining prices that the utility pays for coal and natural gas.

The state Public Service Commission decided Tuesday to decrease the cost of 1,000 kilowatt-hours for homes and apartments by $2.72, starting June 9. The reduction from $130.29 to $127.57 represents a drop of 2.1 percent.

According to the U.S. Department of Energy, the typical American home used 936 kilowatt hours per month in 2007.

The PSC's decision rolls back part of the 13.35 percent increase that the state's utility regulatory commission approved for Alabama Power in October.

"This is a decrease in the increase," PSC President Lucy Baxley said.

The three members of the PSC approved the decrease in a brief meeting with little discussion. It was sweltering in the commission's meeting room because the air conditioning was not working.

Alabama Power, a subsidiary of Southern Co., serves the southern two-thirds of the state. The Tennessee Valley Authority, which serves the northern third, raised rates 20 percent last year due to higher fuel costs. But it has now rolled back most of that increase due to declining fuel prices.