Alabama Monopoly vs. the Sun: The Legal Battle Over Alabama's Rooftop Solar Fees
- Staff Writer
- 2 days ago
- 3 min read
Staff Writer May 13, 2026
The fundamental promise of solar energy is simple: harness the sun to power your life and reduce your dependence on the grid. However, for rooftop solar owners in Alabama, that promise is being eclipsed by what many call "legalized theft." A high-profile response to a Motion to Dismiss in Alabama PSC Docket No. 33679 shines a light on the steep financial climb facing Alabamans who choose renewable energy.
The "Sun Tax": Alabama’s Unique Solar Barrier
While neighboring states like Florida, Georgia, and Mississippi have adopted Net Metering—a policy allowing solar users to trade their excess power for utility electricity on a roughly one-to-one basis—Alabama remains an outlier.
Instead of net metering, Alabama Power utilizes an "avoided cost" model. This allows the utility to pay solar customers significantly less for the power they generate than what the utility charges them for power they consume. In some instances, the effective rate for solar customers has skyrocketed to staggering levels; the complainants in the current PSC docket reported an effective rate of $2.68 per kWh this year due to the combination of low buy-back rates and high fixed fees.
Understanding the Financial Friction
The conflict centers on two primary charges that solar advocates argue are "unreasonable and unjust":
Capacity Reservation Charge (Rider RGB): Often called a "solar tax," this fee is charged based on the maximum amount of power a solar customer might need from the grid if their system fails. Complainants argue they are paying hundreds of dollars a year for the "privilege" of buying negligible amounts of backup power.
The Energy Charge Gap: Small businesses in Alabama often pay a higher Energy Charge than residential neighbors connected to the exact same transformer. In this docket, the discrepancy was noted as high as 9¢ per kWh difference.
A Regulatory Labyrinth
The Alabama Public Service Commission (PSC) is tasked with ensuring utility rates are just and reasonable. However, the current legal challenge alleges that the commission has failed in its duty to protect citizens from monopoly abuses.
The Comparison to Florida
In 2022, Florida Governor Ron DeSantis famously vetoed a bill that would have gutted net metering for Florida residents. He cited the "financial crunch" of record inflation as a reason not to add additional burdens to citizens. Alabama solar advocates are now asking their own commissioners to show similar resolve, especially as the PSC sits on millions in tax revenue that could be used to hire independent renewable energy experts.
The Path Forward: A Call for Transparency
The legal response filed on May 12, 2026, emphasizes that this isn't just about hypothetical numbers—it’s about actual data from real Alabamans. The complainants argue:
Grid Benefits: Solar users provide the most power during hot summer afternoons when the grid is most stressed, yet they receive the least credit for it.
Statutory Relief: Alabama Law (§37-4-140) actually allows the utility to pay more than "avoided costs" for solar power, but only if the utility proposes it. Advocates are calling on the PSC to demand such a proposal.
As the primary elections approach and the P
SC weighs the Motion to Dismiss, the outcome of Docket No. 33679 will likely determine whether Alabama remains one of the most difficult states for rooftop solar or if it will finally align with the "gold standard" of its Southern neighbors.
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