Feb 14 (Reuters) -

U.S. electric and gas utility Southern Co on Wednesday said its Vogtle nuclear plant's Unit 4 had safely reached initial criticality, a crucial step to eventually kick off commercial operations.

The Vogtle two-unit expansion project near Waynesboro, Georgia, has been hailed as a major milestone for the U.S. nuclear power industry, which some see as a key way to transition to cleaner energy sources.

The project, however, is running billions of dollars over budget and years behind schedule.

First criticality is a key step during startup testing and demonstrates that, for the first time, operators have safely started the nuclear reaction inside the reactor, the company added.

Last July, Southern Co's Unit 3 became the newest reactor in the United States to enter commercial service. Unit 4, its second reactor, is slated for completion in the first quarter.

Georgia Power, a unit of Southern Co, has a 45.7% stake in the Vogtle reactors.

Southern Co serves more than 9 million customers. Its electricity segment caters to the states of Alabama, Georgia and Mississippi. The gas segment provides services in the states of Illinois, Georgia, Virginia and Tennessee. (Reporting by Nicole Jao in New York and Ashitha Shivaprasad in Bengaluru; editing by Jason Neely, Liz Hampton and David Gregorio)