Southern : Quarterly Report

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

• þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

  OF THE SECURITIES EXCHANGE ACT OF 1934

  For the quarterly period ended September 30, 2018

  OR

• ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period fromto

Commission File NumberRegistrant, State of Incorporation, Address and Telephone NumberI.R.S. Employer Identification No.

1-3526

The Southern Company 58-0690070 (A Delaware Corporation)

30 Ivan Allen Jr. Boulevard, N.W. Atlanta, Georgia 30308

[phone]

1-3164

Alabama Power Company 63-0004250 (An Alabama Corporation)

600 North 18 th Street Birmingham, Alabama 35203 [phone]

1-6468

Georgia Power Company 58-0257110 (A Georgia Corporation)

241 Ralph McGill Boulevard, N.E. Atlanta, Georgia 30308

[phone]

001-31737

Gulf Power Company 59-0276810 (A Florida Corporation)

One Energy Place Pensacola, Florida 32520 [phone]

001-11229

Mississippi Power Company 64-0205820 (A Mississippi Corporation)

2992 West Beach Boulevard Gulfport, Mississippi 39501 [phone]

001-37803

Southern Power Company 58-2598670 (A Delaware Corporation)

30 Ivan Allen Jr. Boulevard, N.W. Atlanta, Georgia 30308

[phone]

1-14174

Southern Company Gas 58-2210952 (A Georgia Corporation)

Ten Peachtree Place, N.E. Atlanta, Georgia 30309 [phone]

Table of Contents

Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrants have submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrants were required to submit such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Registrant	Large Accelerated Filer	Accelerated Filer	Non-accelerated Filer	Smaller Reporting Company	Emerging Growth Company
The Southern Company	X
Alabama Power Company	X
Georgia Power Company	X
Gulf Power Company	X
Mississippi Power Company	X
Southern Power Company	X
Southern Company Gas	X

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ registrants.)

(Response applicable to all
Description of	Shares Outstanding at
Registrant	Common Stock	September 30, 2018
The Southern Company	Par Value $5 Per Share	1,028,888,684
Alabama Power Company	Par Value $40 Per Share	30,537,500
Georgia Power Company	Without Par Value	9,261,500
Gulf Power Company	Without Par Value	7,392,717
Mississippi Power Company	Without Par Value	1,121,000
Southern Power Company	Par Value $0.01 Per Share	1,000
Southern Company Gas	Par Value $0.01 Per Share	100

No þ

This combined Form 10-Q is separately filed by The Southern Company, Alabama Power Company, Georgia Power Company, Gulf Power Company, Mississippi Power Company, Southern Power Company, and Southern Company Gas. Information contained herein relating to any individual registrant is filed by such registrant on its own behalf. Each registrant makes no representation as to information relating to the other registrants.

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September 30, 2018

Page
Number
5
9
The Southern Company and Subsidiary Companies
Condensed Consolidated Statements of Income	12
Condensed Consolidated Statements of Comprehensive Income	13
Condensed Consolidated Statements of Cash Flows	14
Condensed Consolidated Balance Sheets	15
Management's Discussion and Analysis of Financial Condition and Results of Operations	17
Alabama Power Company
Condensed Statements of Income	61
Condensed Statements of Comprehensive Income	61
Condensed Statements of Cash Flows	62
Condensed Balance Sheets	63
Management's Discussion and Analysis of Financial Condition and Results of Operations	65
Georgia Power Company
Condensed Statements of Income	82
Condensed Statements of Comprehensive Income	82
Condensed Statements of Cash Flows	83
Condensed Balance Sheets	84
Management's Discussion and Analysis of Financial Condition and Results of Operations	86
Gulf Power Company
Condensed Statements of Income	113
Condensed Statements of Comprehensive Income	113
Condensed Statements of Cash Flows	114
Condensed Balance Sheets	115
Management's Discussion and Analysis of Financial Condition and Results of Operations	117
Mississippi Power Company
Condensed Statements of Operations	133
Condensed Statements of Comprehensive Income	133
Condensed Statements of Cash Flows	134
Condensed Balance Sheets	135
Management's Discussion and Analysis of Financial Condition and Results of Operations	137
Southern Power Company and Subsidiary Companies
Condensed Consolidated Statements of Income	158
Condensed Consolidated Statements of Comprehensive Income	158
Condensed Consolidated Statements of Cash Flows	159
Condensed Consolidated Balance Sheets	160
Management's Discussion and Analysis of Financial Condition and Results of Operations	162
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DEFINITIONS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

PART I-FINANCIAL INFORMATION

Item 1.

Item 2.

Financial Statements (Unaudited)

Management's Discussion and Analysis of Financial Condition and Results of Operations

September 30, 2018

PART I-FINANCIAL INFORMATION (CONTINUED)

Southern Company Gas and Subsidiary Companies

Condensed Consolidated Statements of Income 177

Condensed Consolidated Statements of Comprehensive Income 177

Condensed Consolidated Statements of Cash Flows 178

Condensed Consolidated Balance Sheets 179

Management's Discussion and Analysis of Financial Condition and Results of Operations 181

Notes to the Condensed Financial Statements 207

Item 3.

Item 4.

Quantitative and Qualitative Disclosures about Market Risk 59

Controls and Procedures 59

Page Number

PART II-OTHER INFORMATION

Item 1.

Legal Proceedings 286

Item 1A.

Risk Factors 286

Item 2.

Item 3.

Unregistered Sales of Equity Securities and Use of Proceeds Defaults Upon Senior Securities

Item 4.

Mine Safety Disclosures

Item 5.

Other Information

Inapplicable Inapplicable Inapplicable Inapplicable

Item 6.

Exhibits 291

Signatures 295

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Table of Contents
Term	Meaning
2013 ARP	Alternative Rate Plan approved by the Georgia PSC in 2013 for Georgia Power for the years 2014 through 2016 and
subsequently extended through 2019
AFUDC	Allowance for funds used during construction
Alabama Power	Alabama Power Company
ARO	Asset retirement obligation
ASC	Accounting Standards Codification
ASU	Accounting Standards Update
Atlanta Gas Light	Atlanta Gas Light Company, a wholly-owned subsidiary of Southern Company Gas
Atlantic Coast Pipeline	Atlantic Coast Pipeline, LLC, a joint venture to construct and operate a natural gas pipeline in which Southern Company
Gas has a 5% ownership interest
Bechtel	Bechtel Power Corporation, the primary contractor for the remaining construction activities for Plant Vogtle Units 3 and 4
Bechtel Agreement	The October 23, 2017 construction completion agreement between the Vogtle Owners and Bechtel
CCR	Coal combustion residuals
Chattanooga Gas	Chattanooga Gas Company, a wholly-owned subsidiary of Southern Company Gas
Clean Power Plan	Final action published by the EPA in 2015 that established guidelines for states to develop
plans to meet EPA-mandated CO 2 emission rates or emission reduction goals for existing
electric generating units
CO 2	Carbon dioxide
COD	Commercial operation date
Contractor Settlement Agreement	The December 31, 2015 agreement between Westinghouse and the Vogtle Owners resolving disputes between the Vogtle
Owners and the EPC Contractor under the Vogtle 3 and 4 Agreement
Cooperative Energy	Electric cooperative in Mississippi
CPCN	Certificate of public convenience and necessity
Customer Refunds	Refunds issued to Georgia Power customers in 2018 as ordered by the Georgia PSC related to the Guarantee Settlement
Agreement
CWIP	Construction work in progress
Dalton Pipeline	A 50% undivided ownership interest of Southern Company Gas in a pipeline facility in Georgia
DOE	U.S. Department of Energy
ECO Plan	Mississippi Power's environmental compliance overview plan
Eligible Project Costs	Certain costs of construction relating to Plant Vogtle Units 3 and 4 that are eligible for financing under the loan guarantee
program established under Title XVII of the Energy Policy Act of 2005
EPA	U.S. Environmental Protection Agency
EPC Contractor	Westinghouse and its affiliate, WECTEC Global Project Services Inc.; the former engineering, procurement, and
construction contractor for Plant Vogtle Units 3 and 4
FASB	Financial Accounting Standards Board
FERC	Federal Energy Regulatory Commission
FFB	Federal Financing Bank
Fitch	Fitch Ratings, Inc.
Form 10-K	Annual Report on Form 10-K of Southern Company, Alabama Power, Georgia Power, Gulf Power, Mississippi Power,
Southern Power, and Southern Company Gas for the year ended December 31, 2017, as applicable
GAAP	U.S. generally accepted accounting principles
Georgia Power	Georgia Power Company
GHG	Greenhouse gas

DEFINITIONS

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