Study: Alabama Energy Sector Has Massive Impact on State Economy

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The following guest blog comes from Seth Hammett, Chairman of the Energy Institute of Alabama and PowerSouth Energy Cooperative’s Vice President of Business Development. Hammett is a former Speaker of the House of Representatives in Alabama.


Alabama’s energy sector provides the spark that makes the state’s economic engine go. Akin to the consumer who never thinks of what goes into making the lights come on at the flick of a switch, those of us in the energy business were never certain of the exact economic impact provided by the industry.

That has changed.

An economic impact study commissioned by the Energy Institute of Alabama and the Economic Development Partnership of Alabama determined that the energy sector drives $13.22 billion a year into our economy. Dr. Keivan Deravi of Auburn University at Montgomery conducted the study this summer using figures from 2015. The study also determined that 124,000 Alabama jobs depend on the energy business, that our state’s General Fund and Education Trust Fund receive $385 million in tax dollars from the energy sector each year and that the electricity production component of the industry has a $8.24 billion impact.

Read the Full Report Here

This study was the first of its kind and is an important part of the puzzle that the EIA aims to piece together to help policy-makers base their decisions on facts, not fiction, when it comes to energy issues. The EIA, formed when the six electricity producers and distributors in the state – Alabama Municipal Electric Authority, Alabama Power Company, Alabama Rural Electric Association of Cooperatives, Electric Cities of Alabama, PowerSouth Energy Cooperative and the Tennessee Valley Authority – came together to speak with one voice on policy issues while always thinking of the end consumer.

Alabama has been blessed with abundant natural resources that have allowed us to enjoy a strong and diverse energy industry. In fact, Alabama has the third-largest coal exporting seaport, ranks fifth in the United States in generating electricity from biomass sources, is No. 6 in total electricity generation and is 16th in natural gas production.

Please take the time to explore the entire study, linked to this article, and visit our website for more information about the Energy Institute of Alabama and our state’s energy sector.