MONTGOMERY, Ala. – A new three-bill package in the Alabama Legislature would overhaul the structure of the Public Service Commission, control the proliferation of power-hungry data centers and add new restrictions on lobbying and public meetings for state utilities.
The bi-partisan group of lawmakers bringing the bills say their goal is to address affordability for families, specifically in the form of rising electricity bills.
“Alabama families and businesses should never foot the bill for someone else’s private profit,” Sen. Lance Bell, R-Pell City, said in a news release. He’s chairman of the Senate Committee on Fiscal Responsibility and Economic Development and sponsor of Senate Bill 270, which would require data center operators to pay the full cost of grid infrastructure upgrades needed for their projects. State Rep. Neil Rafferty, D-Birmingham, is sponsoring the House version of the measure, House Bill 403.
“We are making sure our state’s existing utility customers are taken care of and ensuring that energy costs remain fair and predictable for everyone,” Rafferty said.
Another measure targeting data center development is Senate Bill 265 from State Sen. Andrew Jones, R-Centre, and House Bill 399 from State Rep. Leigh Hulsey, R-Pelham. It would alter Bentley-era tax incentives for data centers that are seen by many as too generous and long-lasting. The bills would require large data centers using more than 100 megawatts to pay state sales taxes and cap at 20 years any abatement incentives agreed to by the state.
Jones said the goal is to stop data centers from taking advantage of out-dated economic incentives and driving up power costs where they locate.
“We need incentives that work for all Alabamians—not just big tech,” Jones said. “This bill ensures that taxpayer-supported incentives deliver real value to our state and don’t drive up utility costs for hardworking Alabamians.”
Also, the revenue generated by data center sales taxes would go to the state’s General Fund, rather than the Education Trust Fund. The General Fund has historically faced greater financial struggles because most growth tax revenue is steered to the ETF.
The third measure in the “affordability protection plan” would make the Public Service Commission, the three-member panel that regulates state utilities, appointed rather than elected. Specifically, the president would be appointed by the governor, one member would be appointed by the Speaker of the House and one would be appointed by the Senate President Pro Tem, with all members requiring Senate confirmation.
Senate Minority Leader Bobby Singleton, D-Greensboro, said the appointed model is preferred in today’s political environment dominated by special interests.
“Alabama is one of only ten states in the country that still elects its PSC, and it is time to modernize how we set utility rates and double down on the oversight we have on this board,” Singleton said.
That legislation – Senate Bill 209 and House Bill 392 – would also institute new regulations for state utilities, including Alabama Power Company. It would mandate that utilities hold annual public meetings to present rates, costs and other factors impacting customers. It would also prohibit utilities from spending rate-payer money on lobbying expenses or any other political activity.
Rep. Chip Brown, R-Hollinger’s Island, is sponsoring that bill in the House.
“This legislation restores trust in utility oversight and ensures Alabama residents are protected from political or outside influence at a time when energy is more important and complex than it has ever been,” Brown said.
The Alabama Legislature’s 2026 Regular Session is one third of the way complete, with 20 more legislative days remaining.
The House bills are set to be taken up by the House Transportation, Utilities and Infrastructure Committee at 11:00 a.m. on Tuesday, Feb. 10.
The Senate bills have been referred to the Fiscal Responsibility and Economic Development Committee, which meets Wednesday, February 11 at 3:00 p.m.