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-HB403 INTRODUCED
-Page 0
-HB403
-4UKMHIR-1
-By Representatives Rafferty, Hulsey, Tillman
-RFD: Transportation, Utilities and Infrastructure
-First Read: 05-Feb-26
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-4UKMHIR-1 02/05/2026 JWB (L)bm 2026-729
+FN-846LAHF-1
 Page 1
-First Read: 05-Feb-26
-SYNOPSIS:
-Under existing law, the Public Service
-Commission reviews retail electric service contracts
-between utilities and large load customers. The
-commission approves these contracts if the commission
-finds that the contracts are in the public interest.
-This bill would provide that when the commission
-is making the determination that a contract between a
-utility and a large load data center is in the public
-interest, the commission must take into account certain
-considerations, including that the contract will
-provide for the recovery from the data center of
-incremental costs that are attributable to the data
-center and that the contract will promote positive
-benefits for other residential, commercial, and
-industrial utility customers.
-A BILL
-TO BE ENTITLED
-AN ACT
-Relating to utilities; to add Section 37-4-22.1 to the
-Code of Alabama 1975; to provide specific considerations for
-the Public Service Commission's review and approval of retail
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-HB403 INTRODUCED
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-the Public Service Commission's review and approval of retail
-electric service contracts between a utility and a large load
-data center, including determining that such contracts provide
-for the recovery of incremental costs and promote other
-positive benefits.
-BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
-Section 1.  Section 37-4-22.1 is added to the Code of
-Alabama 1975, to read as follows:
-§37-4-22.1
-(a) For purposes of this section, the following terms
-have the following meanings:
-(1) INCREMENTAL COSTS OF RETAIL ELECTRIC SERVICE. The
-additional costs associated with the generation, transmission,
-distribution, sale, or furnishing of electricity to a large
-load data center customer, including fuel costs and taxes,
-which the utility would not incur but for the large load data
-center customer contract.
-(2) LARGE LOAD DATA CENTER. A customer of the utility
-which has executed a contract for retail electric service with
-the utility which requires the utility to serve an electric
-load of at least 150 megawatts and meets the definition of a
-data processing center as defined in Section 40-9B-3.
-(3) TERMS AND CONDITIONS. The provisions in a contract
-for service between a customer and utility which address
-matters such as minimum term for contract length, upfront
-payments, security and collateral, and minimum payment.
-(b) Consistent with the commission's authority under
-Title 37 generally and Section 37-4-22 specifically, a
-contract for retail electric service between a utility and a
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-HB403 INTRODUCED
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-contract for retail electric service between a utility and a
-person that qualifies as a large load data center is
-consistent with the public interest where the commission
-determines that the contract pricing and contract terms and
-conditions over the contract term will:
-(1) Provide for the recovery of the incremental costs
-of retail electric service to the large load data center
-customer's premises from the large load data center customer;
-and
-(2) Promote positive benefits to all other retail
-electric customers of the utility.
-(c) The determination of whether a contract between a
-large load data center and a utility promotes positive
-benefits under subdivision (b)(2) includes considerations such
-as:
-(1) Whether the pricing and terms and conditions of the
-contract could lower costs for other residential, commercial,
-and industrial customers of the utility; and
-(2) Whether the large load data center customer is
-expected to increase the efficiency of the utility's power
-system; and
-Section 2.  This act shall become effective on October
-1, 2026.
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+FISCAL NOTE
+House Bill 403
+Committee: Transportation, Utilities and
+Infrastructure
+Sponsor: Representative Neil Rafferty
+Analyst: Jennifer Farish Date: 02/06/2026
+House Bill 403 as introduced would not directly affect state or local funding.