Alabama Power customers will receive a $25 credit in October, following a decision by the Alabama Public Service Commission (PSC).

Commissioners approved the credit at their monthly meeting. The newly approved credit is on top of a 3% rate reduction that customers are already enjoying in 2020.

Combined with prior rate actions, customers are receiving approximately $300 million in benefits this year.

The newly approved credit is based on lower expenses for the fuel Alabama Power uses at its generating plants. Customers will receive a total of $100 million from the fuel-related credit.

A typical residential customer using 1,000 kilowatt-hours of electricity per month is expected to receive a credit of $25. Customers who use more energy will receive a larger credit.

“We appreciate the commission voting today to expedite this credit for our customers,” said Richard Hutto, Alabama Power’s vice president of Regulatory Affairs.

Alabama Power has seen lower fuel prices during the COVID-19 pandemic and, as always, these lower costs benefit Alabama Power customers. Adjustments to fuel costs are typically calculated at the end of the year, with savings passed to customers beginning in January.

Because of the impact of the pandemic on many Alabamians and Alabama businesses, Alabama Power proposed to the commission that an adjustment be made for fuel expenses earlier than normal, with the benefits credited directly to customers.

“Many of our customers have been hurt by COVID-19. We hope this credit will provide some additional relief at this difficult time,” Hutto said.

Customers are already benefiting from the 3% rate reduction that took effect in January, which was based on earlier estimates of lower costs for fuel and other expenses for 2020. The rate reduction alone equates to about a $4.50-per-month reduction for the typical residential customer.

“Our employees are working every day to keep costs low while providing industry-leading reliability for our customers,” Hutto said.

Alabama Power’s total retail price is below the national average and has been for decades. When adjusted for inflation, the price customers pay for electricity is lower today than 30 years ago.

Alabama Power has been assisting customers in other ways during the COVID-19 outbreak. Since the start of the pandemic, the company has suspended disconnects and late payment fees for customers hurt by the coronavirus. Learn more about Alabama Power and how the company is working to serve customers at www.alabamapower.com.