Exhibit 8.1
                              Balch & Bingham LLP
                               Post Office Box 306
                            Birmingham, Alabama 35201
                                  205-251-8100


                                February 18, 1999



Alabama Power Company
600 North 18th Street
Birmingham, AL 35291

Re: Alabama Power Capital Trust III - Capital Auction Preferred Securities

Ladies and Gentlemen:

         We have acted as counsel to Alabama Power Company in connection with
the preparation of a Prospectus Supplement dated February 18, 1999 related to
the Capital Auction Preferred Securities of Alabama Power Capital Trust III (the
"Prospectus Supplement") and the accompanying Prospectus (together with the
Prospectus Supplement, the "Prospectus"), which is filed with the Securities and
Exchange Commission under the Securities Act of 1933, as amended (the "Act").

         We have reviewed copies of the Prospectus and such other documents as
we have deemed necessary or appropriate as a basis for the opinion set forth
below.

         Based on the foregoing, we are of the opinion that the statements and
legal conclusions contained in the Prospectus Supplement under the caption
"Certain Federal Income Tax Considerations" are correct in all material
respects.

         We consent to the filing of this opinion as an exhibit to the
Prospectus Supplement. We also consent to the reference to Balch & Bingham LLP
under the captions "Certain Federal Income Tax Considerations" and "Legal
Opinions" in the Prospectus Supplement.

                                           Very truly yours,


                                          /s/Balch & Bingham LLP