Energy Department to make $26.5 billion loan to Alabama, Georgia for electric power facilities

Energy Secretary Chris Wright said Wednesday that his department will be doling out its largest-ever loan, to Alabama and Georgia, to boost the states' electrical grids, which is expected to save residents in both states over $7 billion.

The $26.5 billion loan package will go to two wholly-owned subsidiaries of Southern Company, with $22.5 billion going to Georgia Power and $4 billion to Alabama Power, according to The Hill.

The department said the package is expected to lower American energy costs, create thousands of jobs, and increase grid reliability in Georgia and Alabama.

"The Energy Department is lowering energy costs and ensuring the American people have access to affordable, reliable, and secure energy for decades to come,” Wright said in a statement. “The President has been clear: America must reverse the energy subtraction agenda of past administrations and add more reliable power generation to our electrical grid." 

The loans come after Southern Company announced last year that it was freezing its rates for the two states for the next few years and the loans are estimated to reduce Southern Company’s interest expenses by over $300 million per year.