Federal Judge Allows Alabama Power to Charge Fees to Solar Users
A federal judge in the Middle District of Alabama ruled this week that Alabama Power may continue assessing a monthly capacity reservation fee for customers with rooftop solar systems. U.S. District Judge Annemarie Carney Axon granted summary judgment to Alabama Power and the Alabama Public Service Commission.
Case background and court decision
The lawsuit began in 2021. The Greater-Birmingham Alliance to Stop Pollution and several individuals challenged the commission’s approval of the fee.
All three parties filed motions for summary judgment, which the court considered together. Judge Axon denied the plaintiffs’ claims and sided with the utility and commission.
What the fee covers
The charge, often called a capacity reservation or backup fee, applies when customers remain connected to the grid. Utilities say the fee recovers fixed costs for providing backup power when onsite systems are offline.
Typical rooftop solar customers may see a monthly charge that falls roughly between $21 and $32. Alabama Power serves about 1.5 million customers across the state.
Plaintiffs’ arguments and the court’s reasoning
Plaintiffs argued the fee discriminated against solar users. They also said customers were compelled to accept backup service without asking for it.
Judge Axon rejected those claims. She noted plaintiffs challenged the modeling but did not dispute the underlying data. The judge also found customers consent to backup service when they sign interconnection agreements.
The ruling concluded the fee is meant to retrieve fixed costs tied to backup service. The court determined the structure did not unlawfully single out solar users.
Statements and next steps
Alabama Power said customers who rely on the grid should help pay for its upkeep. The company added it supports rooftop solar and does not bill customers for using their panels alone.
The Public Service Commission declined to comment while the appeal window remains open. Plaintiffs may pursue an appeal in federal court.
Solar landscape and related controversies in Alabama
Alabama ranks low in solar capacity nationwide. The Solar Energy Industries Association places the state near the bottom for overall and residential solar capacity.
Large-scale solar projects have stirred political and local opposition. State lawmakers have proposed a one-year moratorium on industrial solar developments. The measure could grant Mobile and Baldwin counties more regulatory oversight.
Contested projects and agreements
Residents near Stockton oppose a 4,500-acre solar proposal. Developer Silicon Ranch plans panels on about 2,000 acres and conservation of roughly 2,500 acres of wetlands.
Alabama Power and Silicon Ranch agreed to deliver power from that project by the end of 2028. Regulators approved the deal in December. The energy will help meet demand tied to Meta’s planned $1.5 billion data center in Montgomery.
Filmogaz.com will monitor any appeals and report further developments about how a federal judge allowed Alabama Power to charge fees to solar users and its wider impacts on solar adoption in the state.
