Alabama
Light → Steady2026 laws trim tax breaks; PSC now votes on 150 MW contracts within 90 days10 items
- Grid connection1
No in-force connection, own-power or reliability rule; Alabama Power connects on standard service, with SB 270 of 1 Oct 2026 touching only contract pricing.
- Power rates3
SB 270, in force 1 Oct 2026, lets the PSC approve 150 MW contracts only if they recover incremental cost with collateral and minimum payments; no rate class.
- Siting and land use3
Birmingham's June 2026 ordinance sets a 500-foot setback above 30 MW; pauses in Homewood, Leeds, Cullman, Anniston, Tarrant and Foley ring the main market.
- Tax treatment3
HB 399, effective 1 June 2026, caps abatements at 20 years and ends state property and construction tax abatement for 100 MW sites once in service.
- Permits and water2
Birmingham's June 2026 ordinance requires water use estimates, closed-loop cooling and solar or fuel cell on-site power above 30 MW; no state rule is in force.
Scored on rules in force, 1 to 5. 5 is the most regulated. Pending rules set the arrow.
Alabama passed two data center laws in 2026 with near-unanimous votes and the governor's backing. HB 399 cuts the maximum tax abatement from 30 to 20 years and makes sites above 100 MW pay certain state taxes once in service. SB 270, in force since 1 October 2026, says the Public Service Commission may approve a contract with a data center of 150 MW or more only if it is expected to recover the added cost of serving it and benefit other customers. In practice review is light: under procedures the commission adopted on 6 October 2026, Alabama Power files a public petition naming the customer and its contracted capacity, the contract and financial analysis go confidentially to staff and the Attorney General, there is no hearing, and commissioners must vote within 90 days or the contract is deemed approved. A separate 2026 law, HB 475, expands the commission to seven members and freezes Alabama Power's rates through 1 January 2029. North Alabama is served by TVA, whose new data center rate applies there.
Alabama Power's contracts for Wooster LLC and APLD BHM-01 LLC, two Applied Digital entities in Tuscaloosa County, were under commission review as of 2 October 2026 under the interim 45-day window, and no vote or deemed approval has been reported since. The commission's 6 October 2026 order requires Alabama Power to file a large load tariff within 10 days of the written order, which will be the first test of the SB 270 standard. In Bessemer, QTS declined the mayor's 19 October 2026 request to pause work on Project Marvel, produced a city grading permit and a state stormwater permit on 22 October, and as of 27 October no meeting had been scheduled; Jefferson County is weighing a 1,000-foot vegetative buffer and will not process data center applications in unincorporated areas until its land use plan is updated. City moratoria keep spreading, with Anniston and Tarrant adding 12-month pauses and Foley six months since August, while counties say Dillon's Rule leaves them no power to act; Sen. Arthur Orr plans a 2027 local bill for Morgan County. The 3 November governor's race splits on the issue: Doug Jones proposes a one-year statewide moratorium and an end to data center tax incentives, and Tommy Tuberville opposes a moratorium and says data centers should pay their full share. The seven-member commission takes over in January 2027.
- SB 270: contract standard for data centers of 150 MW or more
Act 2026-610, effective 1 October 2026, adds Section 37-4-22.1. For a data center whose contract covers expected peak demand of 150 MW or more on contiguous parcels, the commission may find the contract in the public interest only if its pricing and terms are expected to recover the incremental cost of serving that customer, including fuel and taxes, and to promote benefits for the utility's other retail customers. Terms covered include minimum contract length, upfront payments, security and collateral and minimum payments.
alison.legislature.state.al.us - PSC review process for Alabama Power data center contracts: 90-day window
On 8 July 2026 the Public Service Commission opened a proceeding (Docket 33709) and extended its review window for data center contracts from the 10 days in place since 1996 to 45 days. On 6 October 2026 it unanimously adopted final procedures for contracts covered by Act 2026-610: Alabama Power files a public petition naming the customer and its parents, the county or city and the maximum contracted capacity, the full contract and financial analysis go confidentially to commission staff and the Attorney General, and commissioners must vote within 90 days or the contract is deemed approved. There is no hearing or intervention, and Alabama Power was ordered to file a large load tariff within 10 days of the written order. Under the interim window one contract, for ADC Holdings (Nebius, Oxmoor Valley), was deemed approved and two, Wooster LLC and APLD BHM-01 LLC (Applied Digital, Tuscaloosa County), were under review as of 2 October 2026.
abc3340.com - Project Marvel (QTS) campus: new mayor seeks halt, QTS continues under city permits
Bessemer's council approved the original Project Marvel plan 5-2 on 18 November 2025 and in April 2026 voted 5-2 to rezone about 914 more acres, taking the campus to roughly 1,600 acres; a residents' suit alleging spot zoning was dismissed with prejudice on 22 June 2026, and QTS confirmed in July 2026 it is the developer of the $14 billion campus. On 19 October 2026 newly sworn-in Mayor Louise Alexander had the city send QTS a letter asking it to pause clearing, grading and other site work pending a review of city permits and procedures. QTS declined on 20 October 2026, citing a city mass grading permit and a state construction stormwater permit, asked to postpone a 23 October meeting, and said it has no plans to expand the campus; as of 27 October 2026 no new meeting date had been set and QTS gave a five to seven year buildout. Jefferson County is weighing a 1,000-foot vegetative buffer between homes and the site.
abc3340.com - Counties say they lack authority to regulate data centers; local bill planned
Under Dillon's Rule Alabama counties have no zoning power in unincorporated areas, so Lowndes, Mobile and Escambia counties say they cannot stop proposed campuses. Sen. Arthur Orr plans a 2027 local bill giving Morgan County permitting authority over data centers and says a statewide measure would need wider vetting; Democratic governor nominee Doug Jones proposes a one-year statewide moratorium and an end to data center tax breaks, while Republican nominee Tommy Tuberville supports data centers.
govtech.com - Jefferson County: no data center applications until land use rules exist; 1,000-foot buffer weighed
On 24 June 2026 the county attorney said Jefferson County has no framework to process a data center application in its unincorporated areas until its land use plan is updated, which the county manager called a de facto moratorium, and the Developmental Services department is drafting a data center ordinance. Commission President Jimmie Stephens proposed a formal moratorium but on 25 June 2026 asked staff to proceed in an orderly way instead of voting one through. On 20 October 2026 Stephens said the county is considering a 1,000-foot vegetative buffer between homes and the QTS campus in Bessemer and would vote no on any expansion needing county approval. No adoption date has been set.
abc3340.com - City moratoria spread: Anniston and Tarrant add 12-month pauses, Foley six months
Leeds, Homewood, Cullman, Fort Payne, Fairfield, Springville and Prichard followed Birmingham's March 2026 pause with moratoria of their own, with Leeds and Homewood acting in June 2026 and Cullman on 23 June 2026. Anniston adopted a 12-month moratorium on data center permitting, development and licensing within its regulatory jurisdiction on 18 August 2026 (Resolution 26-R-97), Tarrant approved a 12-month pause reported on 8 September 2026, and Foley adopted a six-month halt covering data centers, crypto mining and server farms in September 2026. Counties cannot follow: Alabama counties lack zoning authority under Dillon's Rule, so Lowndes, Mobile and Escambia commissioners say they cannot block Project Red Clay or the $6 billion Beacon project, and Escambia passed only a non-binding resolution in June 2026.
govtech.com - Birmingham hyperscale data center zoning ordinance: 500-foot residential setback
Adopted 9 June 2026 by a 6-3 vote as the replacement for the city's 180-day pause. A hyperscale data center is one over 200,000 square feet of floor area or with aggregate electrical demand above 30 MW. Hyperscale sites must sit at least 500 feet from residential zoning or an urban neighborhood district and at least 1,000 feet from a fixed guideway transit line or station, must commission noise studies before and after construction, must state estimated daily and annual water use and use closed-loop cooling, and may generate on-site power only from solar or fuel cells. Existing operators are not affected but expansions must meet the rules.
alreporter.com - HB 399: abatements capped at 20 years
Enacted 17 April 2026 after passing the House 103 to 0 and the Senate 32 to 0; effective 1 June 2026. For abatements granted on or after 1 January 2027 the maximum for data processing centers investing more than $200 million falls from 30 to 20 years, with up to 10 more only under a binding agreement to fund local roads, bridges, broadband, water or wastewater systems or education; the extra years are revoked with repayment if the company defaults. For data centers with peak demand of 100 MW or more, the abatement of state non-education property tax and of state construction-related sales and use taxes ends once the site is in service, though servers, computers, networking, software and cooling equipment stay abatable. The program sunset moves from 2028 to 31 July 2032.
alison.legislature.state.al.us - HB 475: PSC expanded to seven members, rate freeze to 2029
Signed 2 April 2026. Expands the Public Service Commission from three members elected statewide to seven, with the governor to appoint four members by 15 July 2026 from lists supplied by legislative leaders and all seven seats then elected by congressional district on a phase-in through 2030; October 2026 reports say the seven-member commission takes over in January 2027 and that Cynthia Almond is the only current member keeping her seat. The next governor appoints a secretary of energy to supervise the commission, and no formal rate hearing may be held until 2029 unless the secretary or five of seven commissioners call one. Alabama Power's rates are frozen through 1 January 2029, which limits any test of whether data center load lowers rates.
alabamareflector.com - Birmingham 180-day moratorium on data centers above 20 MW
Adopted 3 March 2026 with immediate effect. For 180 days the city would not accept or act on permits, site plans or licenses for new or expanded data centers using more than 20 MW; DC Blox's expansion and the Nebius AI Factory were already in permitting and exempt. The council adopted a replacement zoning ordinance for hyperscale data centers on 9 June 2026 by a 6-3 vote, and the 180-day pause ran out around 30 August 2026 with no extension found.
birminghamwatch.org