Monthly Archives: October 2013

How much money does Alabama Power spend to get its way? More than most

By John Archibald  on October 16, 2013 at 1:00 PM, updated October 16, 2013 at 1:50 PM

Why does Alabama Power always seem to get what it wants?

Because you get what you pay for.

In the last 2 ½ years, Alabama Power Co. has spent a staggering $50.4 million to influence politics and public opinion, according to documents the company filed with theFederal Energy Regulatory Commission.

That figure is so out of whack with industry standards it pops off the page. Alabama Power’s spending for the FERC category “Certain Civic, Political & Related Activities” far surpassed that spent by much larger utilities. (You can see the chart below).

Average spending by the five largest electric utilities in the U.S. — Pacific Gas & Electric, Southern California Edison, Commonwealth Edison, Consolidated Edison and Florida Power — was less than half Alabama Power’s spending for influence since the end of 2010.

And let’s face it. These are companies that know a thing or two about getting what they want.

The difference is more striking on a per customer basis. Alabama Power, with about 1.4 million customers, spent about $36 per customer on influence in that 2 ½ years. That is about seven times higher than Pacific Gas, the nation’s largest electric utility.

It is six times higher than Southern Cal and Commonwealth Edison, more than four times the amount spent by Southern Company sisters Georgia Power and Florida Power, and three times that of sister Mississippi Power.

I’d love to tell you it was all a mad scramble by Alabama Power, that the spending came as the company geared up to grease the skids and shape public opinion before this year’s rate review before the Alabama Public Service Commission. But I can’t.

First, I don’t know for sure who Alabama Power paid. The power company no longer has to disclose where those payments go, and the company has declined to discuss it.

Second, it’s not much of an increase anyway. Alabama Power has always greased the skids, and always – always – prepares for whatever bumps lie in the company’s oh-so-profitable road.

Truth is, Alabama Power spending for influence has been remarkably steady since 2003, averaging about $19.8 million a year. In that time the company has spent $208 million in the category FERC defines as spending to influence public opinion, public officials or public actions.

The feds are clear that this money “Shall not include such expenditures which are directly related to appearances before regulatory or other governmental bodies in connection with the reporting utility’s existing or proposed operations.”

But we don’t know where it does go. Yet.

In the past, way back when the feds demanded specifics, it was possible to follow the money to government affairs strategists and political leg breakers in Washington and Montgomery. Back then, more than a decade ago, large sums went to the Hawthorne Group, and to Perkins and Associates.

Perkins and Associates is predecessor to the shadowy Matrix group, which has been linked to at least one of the non-profits that sang Alabama Power’s praises – and bashed its opponents – during the recent rate hearings.

But we’ll have to come back to that.

Until then, Alabama Power Company wants you to know that all this money comes out of shareholder pockets and not customer pockets, however that distinction is to be made.

And the company has argued all along that some of it is used for “civic good.” We just aren’t allowed to see how good.

Much is for influence. It is a massive sum, spent by a monopoly that, as industry analyst Stephen Hill put it during the hearings, continues to have the highest allowed profit in the whole U.S. of A.

Do you get what you pay for? Alabama Power does.

John Archibald’s column appears Sundays, Wednesdays and Fridays in the Birmingham News, and on Email him at

The chart below indicates money spent for Certain Civic, Political & Related Activities in 2011, 2012 and first half of 2013 

Company Customers 2013_Q2 2012 2011 Total
Alabama Power 1400000 10,249,024 20,084,055 20,074,234 $ 50,407,313.00
Pacific Gas and Electric 5200000 4,220,160 11,323,957 9,364,411 $ 24,908,528.00
Southern California Edison 5200000 6,873,981 12,671,781 11,688,229 $ 31,233,991.00
Commonwealth Edison 3700000 2,786,265 5,578,505 16,231,863 $ 24,596,633.00
Consolidated Edison 2700000 737,412 1,404,087 1,137,466 $   3,278,965.00
Florida Power 4500000 7,404,951 16,974,313 12,237,275 $ 36,616,539.00

Source: FERC