MONTGOMERY, Ala.—Alabama state regulators have cleared the way for Alabama Power to purchase an 895-megawatt gas-fired power plant, further tying Alabama’s largest electric utility to climate-polluting natural gas for decades to come.
The three-member Alabama Public Service Commission unanimously approved a request from the utility to purchase the Lindsay Hill Generating Station near Billingsley.
The $622 million purchase will increase the bills of Alabama Power customers by about $3.32 per month, beginning in 2027, according to the company.
Two environmental groups, Energy Alabama and the Greater-Birmingham Alliance to Stop Pollution (GASP), intervened in the docket, arguing that the company hadn’t sufficiently proved that it needed the extra capacity or that it had considered alternatives like solar and battery storage.
“Alabama families deserve better than approving polluting power plants without proof they’re absolutely necessary,” Jilisa Milton, director of GASP, said in a statement.
Alabama Power, in documents submitted to the commission, said that the addition was needed for 2029, based on its latest load forecast, which includes two large data center projects. Details of the projects, including expected size and locations, were not disclosed in the public documents. It’s unclear whether a massive data center planned in Bessemer was one of the two included in the forecast.
“This milestone reinforces our commitment to deliver dependable energy to Alabama communities,” Alabama Power said in an emailed statement. “Adding Lindsay Hill’s strong track record of reliable power to our generation mix will strengthen our ability to meet the growing needs of our state so we can economically produce the electricity our customers count on.
“Customers will not see any impact on their bills from this facility until mid-2027.”
The Lindsay Hill plant is located just 1,000 feet from the Central Alabama Generating Station, a 885-MW gas power plant that Alabama Power purchased in 2020, as part of a $1.1 billion expansion that included massive natural gas investments and no renewable energy projects.
The addition is the latest in a series of major investments in natural gas infrastructure the company has made since 2020. In total, Alabama Power has agreed to buy or build more than 3,400 MW of natural gas power plants in the past five years, which critics say makes the utility too reliant on the energy source while ignoring renewable energy options.
“Alabama Power’s five-year gas grab burdens families with higher bills and highlights the utility’s failure to consider cheaper and cleaner alternatives,” Daniel Tait, executive director of Energy Alabama, said in a statement.
The Lindsay Hill plant was built in 2002 by Tenaska, an energy company that has developed power facilities in nine states. The electricity from Lindsay Hill is contracted to energy trading company Mercuria Energy America through April 2027. When the deal closes, Alabama Power would continue providing the electricity to Mercuria and receive payments under the existing contract. After that, the company would use the plant for its own needs.
The company says the plant’s expected useful life cycle extends to 2042.
The Southern Environmental Law Center, which represented GASP and Energy Alabama in the docket, says Alabama Power has only 634 MW of utility-scale solar compared to neighboring Georgia’s 5,200 MW.
“Once again, Alabama Power did not consider clean, low-cost options like solar, batteries, and energy efficiency programs and opted to double down on methane gas,” Christina Tidwell, a senior attorney in SELC’s Alabama office, said in a statement. “Alabama will continue to lag behind other states in cost effective, renewable energy, like solar, if our leaders approve investment in harmful energy sources instead of clean, renewable options.”
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Reporter, Alabama
Dennis Pillion is a reporter for Inside Climate News based in Alabama. He joined ICN in 2024 after 17 years working for Alabama Media Group, including nine as the statewide natural resources reporter. His work for AL.com and The Birmingham News, won numerous Green Eyeshade and Alabama Press Association awards for his coverage of environmental issues in Alabama. He was born and lives in Birmingham, Ala.
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