|
Commission
File Number
|
|
Registrant, State of Incorporation,
Address and Telephone Number
|
|
I.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
|
|
|
|
|
(404) 506-5000
|
|
|
|
|
|
|
|
1-3164
|
|
Alabama Power Company
|
|
63-0004250
|
|
|
(An Alabama Corporation)
|
|
|
|
|
600 North 18th Street
|
|
|
|
|
Birmingham, Alabama 35291
|
|
|
|
|
(205) 257-1000
|
|
|
|
|
|
|
|
1-6468
|
|
Georgia Power Company
|
|
58-0257110
|
|
|
(A Georgia Corporation)
|
|
|
|
|
241 Ralph McGill Boulevard, N.E.
|
|
|
|
|
Atlanta, Georgia 30308
|
|
|
|
|
(404) 506-6526
|
|
|
|
|
|
|
|
001-31737
|
|
Gulf Power Company
|
|
59-0276810
|
|
|
(A Florida Corporation)
|
|
|
|
|
One Energy Place
|
|
|
|
|
Pensacola, Florida 32520
|
|
|
|
|
(850) 444-6111
|
|
|
|
|
|
|
|
001-11229
|
|
Mississippi Power Company
|
|
64-0205820
|
|
|
(A Mississippi Corporation)
|
|
|
|
|
2992 West Beach Boulevard
|
|
|
|
|
Gulfport, Mississippi 39501
|
|
|
|
|
(228) 864-1211
|
|
|
|
|
|
|
|
001-37803
|
|
Southern Power Company
|
|
58-2598670
|
|
|
(A Delaware Corporation)
|
|
|
|
|
30 Ivan Allen Jr. Boulevard, N.W.
|
|
|
|
|
Atlanta, Georgia 30308
|
|
|
|
|
(404) 506-5000
|
|
|
|
|
|
|
|
1-14174
|
|
Southern Company Gas
|
|
58-2210952
|
|
|
(A Georgia Corporation)
|
|
|
|
|
Ten Peachtree Place, N.E.
|
|
|
|
|
Atlanta, Georgia 30309
|
|
|
|
|
(404) 584-4000
|
|
|
|
|
|
|
|
1
|
As of December 31, 2016.
|
Registrant
|
Yes
|
No
|
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
|
|
Registrant
|
Large
Accelerated
Filer
|
Accelerated
Filer
|
Non-accelerated
Filer
|
Smaller
Reporting
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
|
|
Registrant
|
|
Description of
Common Stock
|
|
Shares Outstanding
at January 31, 2017
|
|
The Southern Company
|
|
Par Value $5 Per Share
|
|
991,051,161
|
|
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
|
|
|
|
Page
|
|
|
|
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|
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|
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|
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|
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|
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|
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|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
|
|
|
|
|
|
Term
|
Meaning
|
Alabama Power
|
Alabama Power Company
|
Bcf
|
Billion cubic feet
|
CCR
|
Coal combustion residuals
|
Clean Air Act
|
Clean Air Act Amendments of 1990
|
CO
2
|
Carbon dioxide
|
Contractor
|
Westinghouse and its affiliate, WECTEC Global Project Services Inc. (formerly known as CB&I Stone & Webster, Inc.), formerly a subsidiary of The Shaw Group Inc. and Chicago Bridge & Iron Company N.V.
|
Dalton
|
City of Dalton, Georgia, acting by and through its Board of Water, Light, and Sinking Fund Commissioners
|
DOE
|
U.S. Department of Energy
|
Duke Energy Florida
|
Duke Energy Florida, LLC
|
EMC
|
Electric membership corporation
|
EPA
|
U.S. Environmental Protection Agency
|
FERC
|
Federal Energy Regulatory Commission
|
FMPA
|
Florida Municipal Power Agency
|
Georgia Power
|
Georgia Power Company
|
Gulf Power
|
Gulf Power Company
|
IBEW
|
International Brotherhood of Electrical Workers
|
IGCC
|
Integrated coal gasification combined cycle
|
IIC
|
Intercompany Interchange Contract
|
Internal Revenue Code
|
Internal Revenue Code of 1986, as amended
|
IPP
|
Independent Power Producer
|
IRP
|
Integrated Resource Plan
|
Kemper IGCC
|
IGCC facility under construction by Mississippi Power in Kemper County, Mississippi
|
KUA
|
Kissimmee Utility Authority
|
KW
|
Kilowatt
|
KWH
|
Kilowatt-hour
|
MEAG Power
|
Municipal Electric Authority of Georgia
|
Merger
|
The merger, effective July 1, 2016, of a wholly-owned, direct subsidiary of Southern Company with and into Southern Company Gas, with Southern Company Gas continuing as the surviving corporation
|
Mississippi Power
|
Mississippi Power Company
|
MW
|
Megawatt
|
natural gas distribution utilities
|
Southern Company Gas' seven natural gas distribution utilities (Nicor Gas, Atlanta Gas Light Company, Virginia Natural Gas, Inc., Elizabethtown Gas, Florida City Gas, Chattanooga Gas Company, and Elkton Gas)
|
Nicor Gas
|
Northern Illinois Gas Company, a wholly-owned subsidiary of Southern Company Gas
|
NRC
|
U.S. Nuclear Regulatory Commission
|
NYSE
|
New York Stock Exchange
|
OPC
|
Oglethorpe Power Corporation
|
OUC
|
Orlando Utilities Commission
|
PATH Act
|
Protecting Americans from Tax Hikes Act
|
Plant Vogtle Units 3 and 4
|
Two new nuclear generating units under construction at Georgia Power's Plant Vogtle
|
Term
|
Meaning
|
power pool
|
The operating arrangement whereby the integrated generating resources of the traditional electric operating companies and Southern Power (excluding subsidiaries) are subject to joint commitment and dispatch in order to serve their combined load obligations
|
PowerSecure
|
PowerSecure Inc.
|
PowerSouth
|
PowerSouth Energy Cooperative
|
PPA
|
Power purchase agreements and contracts for differences that provide the owner of a renewable facility a certain fixed price for the electricity sold to the grid
|
PSC
|
Public Service Commission
|
registrants
|
Southern Company, Alabama Power, Georgia Power, Gulf Power, Mississippi Power, Southern Power Company, and Southern Company Gas
|
RUS
|
Rural Utilities Service
|
SCS
|
Southern Company Services, Inc. (the Southern Company system service company)
|
SEC
|
Securities and Exchange Commission
|
SEGCO
|
Southern Electric Generating Company
|
SEPA
|
Southeastern Power Administration
|
SERC
|
Southeastern Electric Reliability Council
|
SMEPA
|
South Mississippi Electric Power Association (now known as Cooperative Energy)
|
Southern Company
|
The Southern Company
|
Southern Company Gas
|
Southern Company Gas (formerly known as AGL Resources Inc.) and its subsidiaries
|
Southern Company Gas Capital
|
Southern Company Gas Capital Corporation (formerly known as AGL Capital Corporation), a 100%-owned subsidiary of Southern Company Gas
|
Southern Company system
|
Southern Company, the traditional electric operating companies, Southern Power, Southern Company Gas (as of July 1, 2016), SEGCO, Southern Nuclear, SCS, Southern LINC, PowerSecure (as of May 9, 2016), and other subsidiaries
|
Southern Holdings
|
Southern Company Holdings, Inc.
|
Southern LINC
|
Southern Communications Services, Inc.
|
Southern Nuclear
|
Southern Nuclear Operating Company, Inc.
|
Southern Power
|
Southern Power Company and its subsidiaries
|
traditional electric operating companies
|
Alabama Power, Georgia Power, Gulf Power, and Mississippi Power
|
Vogtle Owners
|
Georgia Power, OPC, MEAG Power, and Dalton
|
Westinghouse
|
Westinghouse Electric Company LLC
|
•
|
the impact of recent and future federal and state regulatory changes, including environmental laws regulating emissions, discharges, and disposal to air, water, and land
,
and also changes in tax and other laws and regulations to which
Southern Company and its subsidiaries are
subject, including potential tax reform legislation, as well as changes in application of existing laws and regulations;
|
•
|
current and future litigation, regulatory investigations, proceedings, or inquiries
;
|
•
|
the effects, extent, and timing of the entry of additional competition in the markets in which
Southern Company's subsidiaries operate;
|
•
|
variations in demand for
electricity and natural gas,
including those relating to weather, the general economy and recovery from the last recession, population and business growth (and declines), the effects of energy conservation and efficiency measures, including from the development and deployment of alternative energy sources such as self-generation and distributed generation technologies, and any potential economic impacts resulting from federal fiscal decisions;
|
•
|
available sources and costs of
natural gas and other
fuels;
|
•
|
limits on pipeline capacity;
|
•
|
effects of inflation;
|
•
|
the ability to control costs and avoid cost overruns during the development
, construction, and operation of
facilities, which include the development and construction of
generating facilities
with designs that have not been finalized or previously constructed, including changes in labor costs and productivity, adverse weather conditions, shortages and inconsistent quality of equipment, materials, and labor
,
sustaining nitrogen supply,
contractor or supplier delay, non-performance under
construction, operating,
or other agreements, operational readiness, including specialized operator training and required site safety programs, unforeseen engineering or design problems, start-up activities (including major equipment failure and system integration), and/or operational performance (including additional costs to satisfy any operational parameters ultimately adopted by
any PSC);
|
•
|
the ability
to construct facilities in accordance with the requirements of permits and licenses,
to satisfy any environmental performance standards
and
the requirements of tax credits and other incentives
,
and to integrate facilities into the Southern Company system upon completion of construction;
|
•
|
investment performance of
the Southern Company system's employee and retiree benefit plans and nuclear decommissioning trust funds;
|
•
|
advances in technology;
|
•
|
ongoing renewable energy partnerships and development agreements;
|
•
|
state and federal rate regulations
and the impact of pending and future rate cases and negotiations, including rate
actions relating
to fuel and other cost recovery mechanisms;
|
•
|
legal proceedings and regulatory approvals and actions related to Plant Vogtle Units 3 and 4, including Georgia PSC approvals and NRC actions;
|
•
|
actions related to cost recovery for the Kemper IGCC, including the ultimate impact of the 2015 decision of the Mississippi Supreme Court, the Mississippi PSC's December 2015 rate order, and related legal or regulatory proceedings, Mississippi
|
•
|
the ability to successfully operate the electric utilities' generating, transmission, and distribution facilities
and Southern Company Gas' natural gas distribution and storage facilities
and the successful performance of necessary corporate functions;
|
•
|
the inherent risks involved in operating
and constructing
nuclear generating facilities, including environmental, health, regulatory, natural disaster, terrorism, and financial risks;
|
•
|
the inherent risks involved in transporting and storing natural gas;
|
•
|
the performance of projects undertaken by the non-utility businesses and the success of efforts to invest in and develop new opportunities;
|
•
|
internal restructuring or other restructuring options that may be pursued;
|
•
|
potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to
Southern Company or its subsidiaries;
|
•
|
the possibility that the anticipated benefits from the Merger cannot be fully realized or may take longer to realize than expected, the possibility that costs related to the integration of Southern Company and Southern Company Gas will be greater than expected, the ability to retain and hire key personnel and maintain relationships with customers, suppliers, or other business partners, and the diversion of management time on integration-related issues;
|
•
|
the ability of counterparties of
Southern Company and its subsidiaries
to make payments as and when due and to perform as required;
|
•
|
the ability to obtain new short- and long-term contracts with wholesale customers;
|
•
|
the direct or indirect effect on the
Southern Company system's
business resulting from cyber intrusion or terrorist incidents and the threat of terrorist incidents;
|
•
|
interest rate fluctuations and financial market conditions and the results of financing efforts;
|
•
|
changes in Southern Company's and any of its subsidiaries'
credit ratings, including impacts on interest rates, access to capital markets, and collateral requirements;
|
•
|
the impacts of any sovereign financial issues, including impacts on interest rates, access to capital markets, impacts on foreign currency exchange rates, counterparty performance, and the economy in general
, as well as potential impacts on the benefits of the DOE loan guarantees;
|
•
|
the ability of
Southern Company's electric utilities
to obtain additional generating capacity (or sell excess generating capacity) at competitive prices;
|
•
|
catastrophic events such as fires, earthquakes, explosions, floods, tornadoes,
hurricanes and other storms, droughts, pandemic health events such as influenzas, or other similar occurrences;
|
•
|
the direct or indirect effects on the
Southern Company system's
business resulting from incidents affecting the U.S. electric grid
, natural gas pipeline infrastructure
,
or operation of generating
or storage
resources;
|
•
|
the effect of accounting pronouncements issued periodically by standard-setting bodies; and
|
•
|
other factors discussed elsewhere herein and in other reports filed by the registrants
from time to time with the SEC.
|
Item 1.
|
BUSINESS
|
Facility/Source
|
|
Counterparty
|
|
MWs
|
|
|
|
|
Contract Term
|
Addison Unit 1
|
|
MEAG Power
|
|
152
|
|
|
|
|
through April 2029
|
Addison Units 2 and 4
|
|
Georgia Power
|
|
293
|
|
|
|
|
through May 2030
|
Addison Unit 3
|
|
Georgia Energy Cooperative
|
|
151
|
|
|
|
|
through May 2030
|
Cleveland County Unit 1
|
|
North Carolina Electric Membership Corporation (NCEMC)
|
|
45-180
|
|
|
|
|
through Dec. 2036
|
Cleveland County Unit 2
|
|
NCEMC
|
|
180
|
|
|
|
|
through Dec. 2036
|
Cleveland County Unit 3
|
|
North Carolina Municipal Power Agency 1
|
|
183
|
|
|
|
|
through Dec. 2031
|
Dahlberg Units 1, 3, and 5
|
|
Cobb EMC
|
|
224
|
|
|
|
|
through Dec. 2026
|
Dahlberg Units 2, 6, 8, and 10
|
|
Georgia Power
|
|
298
|
|
|
|
|
through May 2025
|
Dahlberg Unit 4
|
|
Georgia Power
|
|
73
|
|
|
|
|
through May 2030
|
Franklin Unit 1
|
|
Duke Energy Florida
|
|
434
|
|
|
|
|
through May 2021
|
Franklin Unit 2
|
|
Morgan Stanley Capital Group
|
|
250
|
|
|
|
|
through Dec. 2025
|
Franklin Unit 2
|
|
Jackson EMC
|
|
60-65
|
|
|
|
|
through Dec. 2035
|
Franklin Unit 2
|
|
GreyStone Power Corporation
|
|
35-40
|
|
|
|
|
through Dec. 2035
|
Franklin Unit 2
|
|
Cobb EMC
|
|
100
|
|
|
|
|
through Dec. 2026
|
Franklin Unit 3
|
|
Morgan Stanley Capital Group
|
|
200
|
|
|
|
|
through Dec. 2027
|
Harris Unit 1
|
|
Georgia Power
|
|
628
|
|
|
|
|
through May 2030
|
Harris Unit 2
|
|
Georgia Power
|
|
649
|
|
|
|
|
through May 2019
|
Harris Unit 2
|
|
Alabama Municipal Electric Authority(1)
|
|
25
|
|
|
|
|
Jan. 2020 – Dec. 2025
|
Mankato
|
|
Northern States Power Company
|
|
375
|
|
|
|
|
through June 2026
|
Mankato
|
|
Northern States Power Company
|
|
345
|
|
|
|
|
June 2019 – May 2039(2)
|
Nacogdoches
|
|
City of Austin, Texas
|
|
100
|
|
|
|
|
through May 2032
|
NCEMC PPA(3)
|
|
EnergyUnited
|
|
100
|
|
|
|
|
through Dec. 2021
|
Oleander Units 2, 3, and 4
|
|
Seminole Electric Cooperative
|
|
465
|
|
|
|
|
through May 2021
|
Oleander Unit 5
|
|
FMPA
|
|
157
|
|
|
|
|
through Dec. 2027
|
Rowan CT Unit 1
|
|
North Carolina Municipal Power Agency 1
|
|
150
|
|
|
|
|
through Dec. 2030
|
Rowan CT Units 2 and 3
|
|
EnergyUnited
|
|
100-175
|
|
|
|
|
Jan. 2022 – Dec. 2025
|
Rowan CT Unit 3
|
|
EnergyUnited
|
|
113
|
|
|
|
|
through Dec. 2023
|
Rowan CC Unit 4
|
|
EnergyUnited
|
|
9-328
|
|
|
|
|
through Dec. 2025
|
Rowan CC Unit 4
|
|
Duke Energy Progress, LLC
|
|
150
|
|
|
|
|
through Dec. 2019
|
Rowan CC Unit 4(4)
|
|
Century Aluminum
|
|
154
|
|
|
|
|
through Dec. 2017
|
Stanton Unit A
|
|
OUC
|
|
341
|
|
|
|
|
through Sept. 2033
|
Stanton Unit A
|
|
FMPA
|
|
85
|
|
|
|
|
through Sept. 2033
|
Wansley Unit 6
|
|
Georgia Power
|
|
570
|
|
|
|
|
through May 2017
|
(1)
|
Alabama Municipal Electric Authority will also be served by Plant Franklin Unit 1 from January 2018 through December 2019.
|
(2)
|
Subject to commercial operation of the expansion project.
|
(3)
|
Represents sale of power purchased from NCEMC under a PPA.
|
(4)
|
Century Aluminum PPA is partially served by Plant Franklin Unit 3.
|
Counterparty
|
|
MWs
|
|
|
|
|
Contract Term
|
Nine Georgia EMCs
|
|
281-370
|
|
|
(1)
|
|
through Dec. 2024
|
Sawnee EMC
|
|
267-609
|
|
|
(1)
|
|
through Dec. 2027
|
Cobb EMC
|
|
0-160
|
|
|
(1)
|
|
through Dec. 2026
|
Flint EMC
|
|
132-316
|
|
|
(1)
|
|
through Dec. 2024
|
City of Dalton, Georgia
|
|
60
|
|
|
|
|
through Dec. 2017
|
EnergyUnited
|
|
55-152
|
|
|
(1)
|
|
through Dec. 2025
|
City of Blountstown, Florida
|
|
10
|
|
|
|
|
through April 2022
|
(1)
|
Represents a range of forecasted incremental capacity needs over the contract term.
|
Facility
|
Counterparty
|
MWs(1)
|
|
Contract Term
|
Solar
|
|
|
|
|
Adobe(2)
|
Southern California Edison Company
|
20
|
|
through May 2034
|
Apex(2)
|
Nevada Power Company
|
20
|
|
through Dec. 2037
|
Boulder 1(3)
|
Nevada Power Company
|
100
|
|
through Dec. 2036
|
Butler
|
Georgia Power
|
100
|
|
through Dec. 2046
|
Butler Solar Farm
|
Georgia Power
|
20
|
|
through Feb. 2036
|
Calipatria(2)
|
San Diego Gas & Electric Company
|
20
|
|
through Feb. 2036
|
Campo Verde(2)
|
San Diego Gas & Electric Company
|
139
|
|
through Sept. 2033
|
Cimarron(2)
|
Tri-State Generation and Transmission Association, Inc.
|
30
|
|
through Nov. 2035
|
Decatur County
|
Georgia Power
|
19
|
|
through Dec. 2035
|
Decatur Parkway
|
Georgia Power
|
80
|
|
through Dec. 2040
|
Desert Stateline(4)
|
Southern California Edison Company
|
300
|
|
through Aug. 2036
|
East Pecos
|
Austin Energy
|
119
|
|
March 2017 – Feb. 2032 (6)
|
Garland A(3)
|
Southern California Edison Company
|
20
|
|
through Sept. 2036
|
Garland(3)
|
Southern California Edison Company
|
180
|
|
through Oct. 2031
|
Granville(2)
|
Duke Energy Progress, LLC
|
2
|
|
through Nov. 2032
|
Henrietta(3)
|
Pacific Gas & Electric Company
|
100
|
|
through Sept. 2036
|
Imperial Valley(3)
|
San Diego Gas & Electric Company
|
150
|
|
through Nov. 2039
|
Lamesa
|
City of Garland, Texas
|
102
|
|
April 2017 – March 2032 (6)
|
Lost Hills Blackwell(3)
|
City of Roseville & Pacific Gas & Electric Company
|
32
|
|
through Dec. 2043
|
Macho Springs(2)
|
El Paso Energy
|
50
|
|
through May 2034
|
Morelos(2)
|
Pacific Gas & Electric Company
|
15
|
|
through Feb. 2036
|
North Star(3)
|
Pacific Gas & Electric Company
|
60
|
|
through June 2035
|
Pawpaw
|
Georgia Power
|
30
|
|
through March 2046
|
Roserock(3)
|
Austin Energy
|
157
|
|
through Nov. 2036
|
Rutherford(2)
|
Duke Energy Carolinas, LLC
|
75
|
|
through Dec. 2031
|
Facility
|
Counterparty
|
MWs(1)
|
|
Contract Term
|
Sandhills
|
Cobb EMC
|
111
|
|
through Oct. 2041
|
Sandhills
|
Flint EMC
|
15
|
|
through Oct. 2041
|
Sandhills
|
Sawnee EMC
|
15
|
|
through Oct. 2041
|
Sandhills
|
Middle Georgia and Irwin EMC
|
2
|
|
through Oct. 2041
|
Spectrum(2)
|
Nevada Power Company
|
30
|
|
through Dec. 2038
|
Tranquillity(3)
|
Shell Energy North America (US), LP
|
204
|
|
through Nov. 2019
|
Tranquillity(3)
|
Southern California Edison Company
|
204
|
|
Dec. 2019 – Nov. 2034
|
Wind
|
|
|
|
|
Grant Plains
|
Oklahoma Municipal Power Authority
|
41
|
|
Jan. 2020 – Dec. 2039
|
Grant Plains
|
Steelcase Inc.
|
25
|
|
through Dec. 2028
|
Grant Plains
|
Allianz Risk Transfer (Bermuda) Ltd.
|
81-122
|
|
April 2017 – March 2027
|
Grant Wind
|
East Texas Electric Cooperative
|
50
|
|
through March 2036
|
Grant Wind
|
Northeast Texas Electric Cooperative
|
50
|
|
through March 2036
|
Grant Wind
|
Western Farmers Electric Cooperative
|
50
|
|
through March 2036
|
Kay Wind
|
Westar Energy Inc.
|
199
|
|
through Sept. 2036
|
Kay Wind
|
Grand River Dam Authority
|
100
|
|
through Dec. 2035
|
Passadumkeag
|
Western Massachusetts Electric Company
|
40
|
|
through June 2031
|
Salt Fork Wind
|
City of Garland, Texas
|
150
|
|
through Nov. 2030
|
Salt Fork Wind
|
Salesforce.com, Inc.
|
24
|
|
through Nov. 2028
|
Tyler Bluff Wind
|
The Proctor & Gamble Company
|
96
|
|
through Dec. 2028
|
Wake Wind(5)
|
Equinix Enterprises, Inc.
|
100
|
|
through Oct. 2028
|
Wake Wind(5)
|
Owens Corning
|
125
|
|
through Oct. 2028
|
Facility/Source
|
Counterparty
|
MWs
|
|
Contract Term
|
NCEMC
|
NCEMC
|
100
|
|
through Dec. 2021
|
|
Southern
Company
system
(a)(b)
|
Alabama
Power
|
Georgia
Power
|
Gulf
Power
|
Mississippi
Power
|
||||||||||
|
(in billions)
|
||||||||||||||
New Generation
|
$
|
1.0
|
|
$
|
—
|
|
$
|
0.7
|
|
$
|
—
|
|
$
|
0.3
|
|
Environmental Compliance
(c)
|
0.9
|
|
0.5
|
|
0.4
|
|
—
|
|
—
|
|
|||||
Generation Maintenance
|
0.9
|
|
0.4
|
|
0.3
|
|
0.1
|
|
0.1
|
|
|||||
Transmission
|
0.8
|
|
0.3
|
|
0.4
|
|
—
|
|
—
|
|
|||||
Distribution
|
1.0
|
|
0.4
|
|
0.5
|
|
0.1
|
|
0.1
|
|
|||||
Nuclear Fuel
|
0.2
|
|
0.1
|
|
0.1
|
|
—
|
|
—
|
|
|||||
General Plant
|
0.4
|
|
0.1
|
|
0.2
|
|
—
|
|
0.1
|
|
|||||
|
5.3
|
|
1.9
|
|
2.6
|
|
0.2
|
|
0.5
|
|
|||||
Southern Power
(d)
|
1.6
|
|
|
|
|
|
|||||||||
Southern Company Gas
(e)
|
1.7
|
|
|
|
|
|
|||||||||
Other subsidiaries
|
0.5
|
|
|
|
|
|
|||||||||
Total
(a)
|
$
|
9.1
|
|
$
|
1.9
|
|
$
|
2.6
|
|
$
|
0.2
|
|
$
|
0.5
|
|
(a)
|
Totals do not add due to rounding.
|
(b)
|
Includes the traditional electric operating companies, Southern Power, and Southern Company Gas, as well as the other subsidiaries. See "Other Businesses" herein for additional information.
|
(c)
|
Reflects cost estimates for environmental regulations. These estimated expenditures do not include any potential compliance costs that may arise from the EPA's final rules and guidelines or future state plans that would limit CO
2
emissions from new, existing, and modified or reconstructed fossil-fuel-fired electric generating units or costs associated with closure and groundwater monitoring under the CCR Rule. See MANAGEMENT'S DISCUSSION AND ANALYSIS – FUTURE EARNINGS POTENTIAL – "Environmental Matters – Environmental Statutes and Regulations" and FINANCIAL CONDITION AND LIQUIDITY – "Capital Requirements and Contractual Obligations" of Southern Company and each traditional electric operating company in Item 7 herein for additional information.
|
(d)
|
Includes approximately $0.8 billion for potential acquisitions and/or construction of new generating facilities.
|
(e)
|
Includes costs for ongoing capital projects associated with infrastructure improvement programs in six different states that have been previously approved by their applicable state regulatory agencies. See MANAGEMENT'S DISCUSSION AND ANALYSIS – FUTURE EARNINGS POTENTIAL – "Infrastructure Replacement Programs and Capital Projects" of Southern Company Gas in Item 7 herein for additional information.
|
Utility
|
State
|
Number of customers
|
Approximate miles of pipe
|
||
|
|
(in thousands)
|
|
||
Nicor Gas
|
Illinois
|
2,220
|
|
34,300
|
|
Atlanta Gas Light Company
|
Georgia
|
1,603
|
|
33,100
|
|
Virginia Natural Gas, Inc.
|
Virginia
|
296
|
|
5,600
|
|
Elizabethtown Gas
|
New Jersey
|
287
|
|
3,200
|
|
Florida City Gas
|
Florida
|
108
|
|
3,700
|
|
Chattanooga Gas Company
|
Tennessee
|
65
|
|
1,600
|
|
Elkton Gas
|
Maryland
|
7
|
|
100
|
|
Total
|
|
4,586
|
|
81,600
|
|
•
|
changes in the availability or price of natural gas and other forms of energy;
|
•
|
general economic conditions;
|
•
|
energy conservation, including state-supported energy efficiency programs;
|
•
|
legislation and regulations;
|
•
|
the cost and capability to convert from natural gas to alternative energy products; and
|
•
|
technological changes resulting in displacement or replacement of natural gas appliances.
|
|
Employees at December 31, 2016
|
|
Alabama Power
|
6,805
|
|
Georgia Power
|
7,527
|
|
Gulf Power
|
1,352
|
|
Mississippi Power
|
1,484
|
|
PowerSecure
|
1,051
|
|
SCS
|
4,341
|
|
Southern Company Gas
|
5,292
|
|
Southern Nuclear
|
3,928
|
|
Southern Power*
|
0
|
|
Other
|
235
|
|
Total
|
32,015
|
|
*
|
Southern Power has no employees. Southern Power has agreements with SCS and the traditional electric operating companies whereby employee services are rendered at amounts in compliance with FERC regulations.
|
•
|
possible disruption of the integrated resource planning processes within the states in the Southern Company system's service territory;
|
•
|
delays and additional processes for developing transmission plans; and
|
•
|
possible impacts on state jurisdiction of approving, certifying, and pricing new transmission facilities.
|
•
|
operator error or failure of equipment or processes;
|
•
|
accidents or explosions;
|
•
|
operating limitations that may be imposed by environmental or other regulatory requirements;
|
•
|
labor disputes;
|
•
|
terrorist attacks (physical and/or cyber);
|
•
|
fuel or material supply interruptions;
|
•
|
transmission disruption or capacity constraints, including with respect to the Southern Company system's transmission, storage, and transportation facilities and third party transmission, storage, and transportation facilities;
|
•
|
compliance with mandatory reliability standards, including mandatory cyber security standards;
|
•
|
implementation of new technologies;
|
•
|
information technology system failure;
|
•
|
cyber intrusion;
|
•
|
an environmental event, such as a spill or release; and
|
•
|
catastrophic events such as fires, earthquakes, floods, droughts, hurricanes and other storms, pandemic health events such as influenzas, or other similar occurrences.
|
•
|
the potential harmful effects on the environment and human health and safety resulting from a release of radioactive materials in connection with the operation of nuclear facilities and the storage, handling, and disposal of radioactive material, including spent nuclear fuel;
|
•
|
uncertainties with respect to the ability to dispose of spent nuclear fuel and the need for longer term on-site storage;
|
•
|
uncertainties with respect to the technological and financial aspects of decommissioning nuclear plants at the end of licensed lives and the ability to maintain and anticipate adequate capital reserves for decommissioning;
|
•
|
limitations on the amounts and types of insurance commercially available to cover losses that might arise in connection with the nuclear operations of Alabama Power and Georgia Power or those of other commercial nuclear facility owners in the U.S.;
|
•
|
potential liabilities arising out of the operation of these facilities;
|
•
|
significant capital expenditures relating to maintenance, operation, security, and repair of these facilities, including repairs and upgrades required by the NRC;
|
•
|
the threat of a possible terrorist attack, including a potential cyber security attack; and
|
•
|
the potential impact of an accident or natural disaster.
|
•
|
shortages and inconsistent quality of equipment, materials, and labor;
|
•
|
changes in labor costs and productivity;
|
•
|
work stoppages;
|
•
|
contractor or supplier delay or non-performance under construction, operating, or other agreements or non-performance by other major participants in construction projects;
|
•
|
delays in or failure to receive necessary permits, approvals, tax credits, and other regulatory authorizations;
|
•
|
delays associated with start-up activities, including major equipment failure and system integration, and/or operational performance (including additional costs to satisfy any operational parameters ultimately adopted by any PSC or other applicable state regulatory agency);
|
•
|
operational readiness, including specialized operator training and required site safety programs;
|
•
|
impacts of new and existing laws and regulations, including environmental laws and regulations;
|
•
|
the outcome of legal challenges to projects, including legal challenges to regulatory approvals;
|
•
|
failure to construct in accordance with permitting and licensing requirements;
|
•
|
failure to satisfy any environmental performance standards and the requirements of tax credits and other incentives;
|
•
|
continued public and policymaker support for such projects;
|
•
|
adverse weather conditions or natural disasters;
|
•
|
other unforeseen engineering or design problems;
|
•
|
changes in project design or scope;
|
•
|
environmental and geological conditions;
|
•
|
delays or increased costs to interconnect facilities to transmission grids; and
|
•
|
unanticipated cost increases, including materials and labor, and increased financing costs as a result of changes in market interest rates or as a result of construction schedule delays.
|
•
|
prevailing market prices for coal, natural gas, uranium, fuel oil, biomass, and other fuels, as applicable, used in the generation facilities of the traditional electric operating companies and Southern Power and, in the case of natural gas, distributed by Southern Company Gas, including associated transportation costs, and supplies of such commodities;
|
•
|
demand for energy and the extent of additional supplies of energy available from current or new competitors;
|
•
|
liquidity in the general wholesale electricity and natural gas markets;
|
•
|
weather conditions impacting demand for electricity and natural gas;
|
•
|
seasonality;
|
•
|
transmission or transportation constraints, disruptions, or inefficiencies;
|
•
|
availability of competitively priced alternative energy sources;
|
•
|
forced or unscheduled plant outages for the Southern Company system, its competitors, or third party providers;
|
•
|
the financial condition of market participants;
|
•
|
the economy in the Southern Company system's service territory, the nation, and worldwide, including the impact of economic conditions on demand for electricity and the demand for fuels, including natural gas;
|
•
|
natural disasters, wars, embargos, acts of terrorism, and other catastrophic events; and
|
•
|
federal, state, and foreign energy and environmental regulation and legislation.
|
•
|
they may not result in an increase in income or provide an adequate return on capital or other anticipated benefits;
|
•
|
they may result in Southern Company or its subsidiaries entering into new or additional lines of business, which may have new or different business or operational risks;
|
•
|
they may not be successfully integrated into the acquiring company's operations and/or internal control processes;
|
•
|
the due diligence conducted prior to a transaction may not uncover situations that could result in financial or legal exposure or the acquiring company may not appropriately evaluate the likelihood or quantify the exposure from identified risks;
|
•
|
they may result in decreased earnings, revenues, or cash flow;
|
•
|
expected benefits of a transaction may be dependent on the cooperation or performance of a counterparty; or
|
•
|
for the traditional electric operating companies, costs associated with such investments that were expected to be recovered through rates may not be recoverable.
|
•
|
an economic downturn or uncertainty;
|
•
|
bankruptcy or financial distress at an unrelated energy company, financial institution, or sovereign entity;
|
•
|
capital markets volatility and disruption, either nationally or internationally;
|
•
|
changes in tax policy;
|
•
|
volatility in market prices for electricity and natural gas;
|
•
|
terrorist attacks or threatened attacks on the Southern Company system's facilities or unrelated energy companies' facilities;
|
•
|
war or threat of war; or
|
•
|
the overall health of the utility and financial institution industries.
|
Item 1B.
|
UNRESOLVED STAFF COMMENTS.
|
Generating Station
|
Location
|
Nameplate
Capacity (1)
|
|
|
|
NUCLEAR STEAM
|
|
|
|
||
Farley
|
Dothan, AL
|
|
|
||
Alabama Power Total
|
|
1,720,000
|
|
|
|
Hatch
|
Baxley, GA
|
899,612
|
|
(11
|
)
|
Vogtle Units 1 and 2
|
Augusta, GA
|
1,060,240
|
|
(12
|
)
|
Georgia Power Total
|
|
1,959,852
|
|
|
|
Total Nuclear Steam
|
|
3,679,852
|
|
|
|
COMBUSTION TURBINES
|
|
|
|
||
Greene County
|
Demopolis, AL
|
|
|
||
Alabama Power Total
|
|
720,000
|
|
|
|
Boulevard
|
Savannah, GA
|
19,700
|
|
|
|
McDonough Unit 3
|
Atlanta, GA
|
78,800
|
|
|
|
McIntosh Units 1 through 8
|
Effingham County, GA
|
640,000
|
|
|
|
McManus
|
Brunswick, GA
|
481,700
|
|
|
|
Robins
|
Warner Robins, GA
|
158,400
|
|
|
|
Wansley
|
Carrollton, GA
|
26,322
|
|
(6
|
)
|
Wilson
|
Augusta, GA
|
354,100
|
|
|
|
Georgia Power Total
|
|
1,759,022
|
|
|
|
Lansing Smith Unit A
|
Panama City, FL
|
39,400
|
|
|
|
Pea Ridge Units 1 through 3
|
Pea Ridge, FL
|
15,000
|
|
|
|
Gulf Power Total
|
|
54,400
|
|
|
|
Chevron Cogenerating Station
|
Pascagoula, MS
|
147,292
|
|
(13
|
)
|
Sweatt
|
Meridian, MS
|
39,400
|
|
|
|
Watson
|
Gulfport, MS
|
39,360
|
|
|
|
Mississippi Power Total
|
|
226,052
|
|
|
|
Addison
|
Thomaston, GA
|
668,800
|
|
|
|
Cleveland County
|
Cleveland County, NC
|
720,000
|
|
|
|
Dahlberg
|
Jackson County, GA
|
756,000
|
|
|
|
Oleander
|
Cocoa, FL
|
791,301
|
|
|
|
Rowan
|
Salisbury, NC
|
455,250
|
|
|
|
Southern Power Total
|
|
3,391,351
|
|
|
|
Gaston
(SEGCO)
|
Wilsonville, AL
|
19,680
|
|
(9
|
)
|
Total Combustion Turbines
|
|
6,170,505
|
|
|
|
COGENERATION
|
|
|
|
||
Washington County
|
Washington County, AL
|
123,428
|
|
|
|
GE Plastics Project
|
Burkeville, AL
|
104,800
|
|
|
|
Theodore
|
Theodore, AL
|
236,418
|
|
|
|
Total Cogeneration
|
|
464,646
|
|
|
Generating Station
|
Location
|
Nameplate
Capacity (1)
|
|
|
|
COMBINED CYCLE
|
|
|
|
||
Barry
|
Mobile, AL
|
|
|
||
Alabama Power Total
|
|
1,070,424
|
|
|
|
McIntosh Units 10&11
|
Effingham County, GA
|
1,318,920
|
|
|
|
McDonough-Atkinson Units 4 through 6
|
Atlanta, GA
|
2,520,000
|
|
|
|
Georgia Power Total
|
|
3,838,920
|
|
|
|
Smith
|
Lynn Haven, FL
|
|
|
||
Gulf Power Total
|
|
545,500
|
|
|
|
Daniel
|
Pascagoula, MS
|
|
|
||
Mississippi Power Total
|
|
1,070,424
|
|
|
|
Franklin
|
Smiths, AL
|
1,857,820
|
|
|
|
Harris
|
Autaugaville, AL
|
1,318,920
|
|
|
|
Mankato
|
Mankato, MN
|
375,000
|
|
|
|
Rowan
|
Salisbury, NC
|
530,550
|
|
|
|
Stanton Unit A
|
Orlando, FL
|
428,649
|
|
(14
|
)
|
Wansley
|
Carrollton, GA
|
1,073,000
|
|
|
|
Southern Power Total
|
|
5,583,939
|
|
|
|
Total Combined Cycle
|
|
12,109,207
|
|
|
|
HYDROELECTRIC FACILITIES
|
|
|
|
||
Bankhead
|
Holt, AL
|
53,985
|
|
|
|
Bouldin
|
Wetumpka, AL
|
225,000
|
|
|
|
Harris
|
Wedowee, AL
|
132,000
|
|
|
|
Henry
|
Ohatchee, AL
|
72,900
|
|
|
|
Holt
|
Holt, AL
|
46,944
|
|
|
|
Jordan
|
Wetumpka, AL
|
100,000
|
|
|
|
Lay
|
Clanton, AL
|
177,000
|
|
|
|
Lewis Smith
|
Jasper, AL
|
157,500
|
|
|
|
Logan Martin
|
Vincent, AL
|
135,000
|
|
|
|
Martin
|
Dadeville, AL
|
182,000
|
|
|
|
Mitchell
|
Verbena, AL
|
170,000
|
|
|
|
Thurlow
|
Tallassee, AL
|
81,000
|
|
|
|
Weiss
|
Leesburg, AL
|
87,750
|
|
|
|
Yates
|
Tallassee, AL
|
47,000
|
|
|
|
Alabama Power Total
|
|
1,668,079
|
|
|
|
Bartletts Ferry
|
Columbus, GA
|
173,000
|
|
|
|
Goat Rock
|
Columbus, GA
|
38,600
|
|
|
|
Lloyd Shoals
|
Jackson, GA
|
14,400
|
|
|
|
Morgan Falls
|
Atlanta, GA
|
16,800
|
|
|
|
North Highlands
|
Columbus, GA
|
29,600
|
|
|
|
Oliver Dam
|
Columbus, GA
|
60,000
|
|
|
|
Rocky Mountain
|
Rome, GA
|
215,256
|
|
(15
|
)
|
Sinclair Dam
|
Milledgeville, GA
|
45,000
|
|
|
|
Tallulah Falls
|
Clayton, GA
|
72,000
|
|
|
|
Terrora
|
Clayton, GA
|
16,000
|
|
|
|
Tugalo
|
Clayton, GA
|
45,000
|
|
|
|
Wallace Dam
|
Eatonton, GA
|
321,300
|
|
|
|
Yonah
|
Toccoa, GA
|
22,500
|
|
|
Generating Station
|
Location
|
Nameplate
Capacity (1)
|
|
|
|
6 Other Plants
|
Various Georgia locations
|
18,080
|
|
|
|
Georgia Power Total
|
|
1,087,536
|
|
|
|
Total Hydroelectric Facilities
|
|
2,755,615
|
|
|
|
RENEWABLE SOURCES:
|
|
|
|
||
SOLAR FACILITIES
|
|
|
|
||
Fort Benning
|
Columbus, GA
|
30,000
|
|
|
|
Fort Gordon
|
Augusta, GA
|
30,000
|
|
|
|
Fort Stewart
|
Fort Stewart, GA
|
30,000
|
|
|
|
Kings Bay
|
Camden County, GA
|
30,000
|
|
|
|
Dalton
|
Dalton, GA
|
6,305
|
|
|
|
3 Other Plants
|
Various Georgia locations
|
2,789
|
|
|
|
Georgia Power Total
|
|
129,094
|
|
|
|
Adobe
|
Kern County, CA
|
20,000
|
|
|
|
Apex
|
North Las Vegas, NV
|
20,000
|
|
|
|
Boulder I
|
Clark County, NV
|
100,000
|
|
|
|
Butler
|
Taylor County, GA
|
103,700
|
|
|
|
Butler Solar Farm
|
Taylor County, GA
|
22,000
|
|
|
|
Calipatria
|
Imperial County, CA
|
20,000
|
|
|
|
Campo Verde
|
Imperial County, CA
|
147,420
|
|
|
|
Cimarron
|
Springer, NM
|
30,640
|
|
|
|
Decatur County
|
Decatur County, GA
|
20,000
|
|
|
|
Decatur Parkway
|
Decatur County, GA
|
84,000
|
|
|
|
Desert Stateline
|
San Bernadino County, CA
|
299,900
|
|
(16)
|
|
Garland
|
Kern County, CA
|
205,130
|
|
|
|
Granville
|
Oxford, NC
|
2,500
|
|
|
|
Henrietta
|
Kings County, CA
|
102,000
|
|
|
|
Imperial Valley
|
Imperial County, CA
|
163,200
|
|
|
|
Lost Hills - Blackwell
|
Kern County, CA
|
33,440
|
|
|
|
Macho Springs
|
Luna County, NM
|
55,000
|
|
|
|
Morelos del Sol
|
Kern County, CA
|
15,000
|
|
|
|
North Star
|
Fresno County, CA
|
61,600
|
|
|
|
Pawpaw
|
Taylor County, GA
|
30,480
|
|
|
|
Roserock
|
Pecos County, TX
|
160,000
|
|
|
|
Rutherford
|
Rutherford County, NC
|
74,800
|
|
|
|
Sandhills
|
Taylor County, GA
|
146,890
|
|
|
|
Spectrum
|
Clark County, NV
|
30,240
|
|
|
|
Tranquillity
|
Fresno County, CA
|
205,300
|
|
|
|
Southern Power Total
|
|
2,153,240
|
|
(17
|
)
|
Total Solar
|
|
2,282,334
|
|
|
|
WIND FACILITIES
|
|
|
|
||
Grant Plains
|
Grant County, OK
|
147,200
|
|
|
|
Grant Wind
|
Grant County, OK
|
151,800
|
|
|
|
Kay Wind
|
Kay County, OK
|
299,000
|
|
|
|
Passadumkeag
|
Penobscot County, ME
|
42,900
|
|
|
|
Salt Fork
|
Donley & Gray Counties TX
|
174,000
|
|
|
|
Tyler Bluff
|
Cooke County, TX
|
125,580
|
|
|
|
Wake Wind
|
Crosby & Floyd Counties, TX
|
257,250
|
|
(18)
|
|
Generating Station
|
Location
|
Nameplate
Capacity (1)
|
|
|
|
Southern Power Total
|
|
1,197,730
|
|
|
|
LANDFILL GAS FACILITY
|
|
|
|
||
Perdido
|
Escambia County, FL
|
|
|
||
Gulf Power Total
|
|
3,200
|
|
|
|
BIOMASS FACILITY
|
|
|
|
||
Nacogdoches
|
Sacul, TX
|
|
|
||
Southern Power Total
|
|
115,500
|
|
|
|
Total Generating Capacity
|
|
46,291,124
|
|
|
(1)
|
See "Jointly-Owned Facilities" herein for additional information.
|
(2)
|
In April 2015, as part of its environmental compliance strategy, Alabama Power ceased using coal at Gadsden Steam Plant and at Plant Barry Units 1 and 2 (250 MWs), but such units will remain available with natural gas as the fuel source. Alabama Power retired Plant Barry Unit 3 (225 MWs) in August 2015 and it is no longer available for generation.
|
(3)
|
Owned by Alabama Power and Mississippi Power as tenants in common in the proportions of 60% and 40%, respectively. In April 2016, Alabama Power and Mississippi Power ceased using coal and began operating Units 1 and 2 solely on natural gas in June 2016 and July 2016, respectively. See Note 3 to the financial statements of Southern Company, Alabama Power, and Mississippi Power under "Regulatory Matters – Alabama Power – Environmental Accounting Order," "Retail Regulatory Matters – Environmental Accounting Order," and "Retail Regulatory Matters – Environmental Compliance Overview Plan," respectively, in Item 8 herein.
|
(4)
|
Capacity shown is Alabama Power's portion (91.84%) of total plant capacity.
|
(5)
|
Capacity shown for Georgia Power is 8.4% of Units 1 and 2 and 75% of Unit 3. Capacity shown for Gulf Power is 25% of Unit 3.
|
(6)
|
Capacity shown is Georgia Power's portion (53.5%) of total plant capacity.
|
(7)
|
Represents 50% of Plant Daniel Units 1 and 2, which are owned as tenants in common by Gulf Power and Mississippi Power.
|
(8)
|
Mississippi Power ceased burning coal and other solid fuel at Plant Watson Units 4 and 5 (750 MWs) and began operating those units solely on natural gas in April 2015. Mississippi Power retired Plant Sweatt Units 1 and 2 (80 MWs) on July 31, 2016.
|
(9)
|
SEGCO is jointly-owned by Alabama Power and Georgia Power. See BUSINESS in Item 1 herein for additional information.
|
(10)
|
The capacity shown is the gross capacity using natural gas fuel without supplemental firing. The net capacity using lignite fuel with supplemental firing is expected to be 582 MWs. Mississippi Power placed the combined cycle and the associated common facilities portion of the Kemper IGCC in service using natural gas in 2014 and expects to place the remainder of the Kemper IGCC, including the gasifier and the gas clean-up facilities, in service by mid-March 2017.
|
(11)
|
Capacity shown is Georgia Power's portion (50.1%) of total plant capacity.
|
(12)
|
Capacity shown is Georgia Power's portion (45.7%) of total plant capacity.
|
(13)
|
Generation is dedicated to a single industrial customer.
|
(14)
|
Capacity shown is Southern Power's portion (65%) of total plant capacity.
|
(15)
|
Capacity shown is Georgia Power's portion (25.4%) of total plant capacity. OPC operates the plant.
|
(16)
|
110 MWs were placed in service in the fourth quarter 2015 and 189 MWs were placed in service through July 2016, bringing the facility's total capacity to approximately 300 MWs.
|
(17)
|
Southern Power total solar capacity shown is 100% of the nameplate capacity for each facility. When taking into consideration Southern Power's 90% equity interest in STR and various 66% and 51% equity interests in SRP's nine solar partnerships, Southern Power's equity portion of the total nameplate capacity from all solar facilities is 1,505 MWs. See Note 2 to the financial statements of Southern Power in Item 8 herein and Note 12 to the financial statements of Southern Company under "Southern Power" in Item 8 herein for additional information.
|
(18)
|
Southern Power owns 90.1%.
|
|
|
|
|
Percentage Ownership
|
||||||||||||||||||||||||||||||
|
|
Total
Capacity
|
|
Alabama
Power
|
|
Power
South
|
|
Georgia
Power
|
|
OPC
|
|
MEAG
Power
|
|
Dalton
|
|
|
Southern
Power
|
|
OUC
|
|
FMPA
|
|
KUA
|
|||||||||||
|
|
(MWs)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Plant Miller Units 1 and 2
|
|
1,320
|
|
|
91.8
|
%
|
|
8.2
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Plant Hatch
|
|
1,796
|
|
|
—
|
|
|
—
|
|
|
50.1
|
|
|
30.0
|
|
|
17.7
|
|
|
2.2
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Plant Vogtle
Units 1 and 2
|
|
2,320
|
|
|
—
|
|
|
—
|
|
|
45.7
|
|
|
30.0
|
|
|
22.7
|
|
|
1.6
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Plant Scherer Units 1 and 2
|
|
1,636
|
|
|
—
|
|
|
—
|
|
|
8.4
|
|
|
60.0
|
|
|
30.2
|
|
|
1.4
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Plant Wansley
|
|
1,779
|
|
|
—
|
|
|
—
|
|
|
53.5
|
|
|
30.0
|
|
|
15.1
|
|
|
1.4
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Rocky Mountain
|
|
848
|
|
|
—
|
|
|
—
|
|
|
25.4
|
|
|
74.6
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Plant Stanton A
|
|
660
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
65.0
|
|
|
28.0
|
|
|
3.5
|
|
|
3.5
|
|
Item 3.
|
LEGAL PROCEEDINGS
|
Item 4.
|
MINE SAFETY DISCLOSURES
|
Item 5.
|
MARKET FOR REGISTRANTS' COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
|
High
|
|
Low
|
||||
2016
|
|
|
|
|
||||
First Quarter
|
|
$
|
51.73
|
|
|
$
|
46.00
|
|
Second Quarter
|
|
53.64
|
|
|
47.62
|
|
||
Third Quarter
|
|
54.64
|
|
|
50.00
|
|
||
Fourth Quarter
|
|
52.23
|
|
|
46.20
|
|
||
2015
|
|
|
|
|
||||
First Quarter
|
|
$
|
53.16
|
|
|
$
|
43.55
|
|
Second Quarter
|
|
45.44
|
|
|
41.40
|
|
||
Third Quarter
|
|
46.84
|
|
|
41.81
|
|
||
Fourth Quarter
|
|
47.50
|
|
|
43.38
|
|
Registrant
|
|
Quarter
|
|
2016
|
|
2015
|
||||
|
|
|
|
(in thousands)
|
||||||
Southern Company
|
|
First
|
|
$
|
496,718
|
|
|
$
|
478,454
|
|
|
|
Second
|
|
526,267
|
|
|
493,161
|
|
||
|
|
Third
|
|
529,876
|
|
|
493,382
|
|
||
|
|
Fourth
|
|
551,110
|
|
|
493,884
|
|
||
Alabama Power
|
|
First
|
|
191,206
|
|
|
142,820
|
|
||
|
|
Second
|
|
191,206
|
|
|
142,820
|
|
||
|
|
Third
|
|
191,206
|
|
|
142,820
|
|
||
|
|
Fourth
|
|
191,206
|
|
|
142,820
|
|
||
Georgia Power
|
|
First
|
|
326,269
|
|
|
258,570
|
|
||
|
|
Second
|
|
326,269
|
|
|
258,870
|
|
||
|
|
Third
|
|
326,269
|
|
|
258,870
|
|
||
|
|
Fourth
|
|
326,269
|
|
|
258,870
|
|
||
Gulf Power
|
|
First
|
|
30,017
|
|
|
32,540
|
|
||
|
|
Second
|
|
30,017
|
|
|
32,540
|
|
||
|
|
Third
|
|
30,017
|
|
|
32,540
|
|
||
|
|
Fourth
|
|
30,017
|
|
|
32,540
|
|
Registrant
|
|
Quarter
|
|
2016
|
|
2015
|
||||
|
|
|
|
(in thousands)
|
||||||
Southern Power Company
|
|
First
|
|
$
|
68,082
|
|
|
$
|
32,640
|
|
|
|
Second
|
|
68,082
|
|
|
32,640
|
|
||
|
|
Third
|
|
68,082
|
|
|
32,640
|
|
||
|
|
Fourth
|
|
68,082
|
|
|
32,640
|
|
Item 6.
|
SELECTED FINANCIAL DATA
|
Item 7.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
Page
|
Item 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Item 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
|
Page
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Page
|
|
|
|
|
|
|
|
|
|
|
Item 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
Item 9A.
|
CONTROLS AND PROCEDURES
|
Item 9B.
|
OTHER INFORMATION
|
Term
|
Meaning
|
2012 MPSC CPCN Order
|
A detailed order issued by the Mississippi PSC in April 2012 confirming the CPCN originally approved by the Mississippi PSC in 2010 authorizing acquisition, construction, and operation of the Kemper IGCC
|
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
|
Baseload Act
|
State of Mississippi legislation designed to enhance the Mississippi PSC's authority to facilitate development and construction of baseload generation in the State of Mississippi
|
CCR
|
Coal combustion residuals
|
Clean Air Act
|
Clean Air Act Amendments of 1990
|
CO
2
|
Carbon dioxide
|
COD
|
Commercial operation date
|
CPCN
|
Certificate of public convenience and necessity
|
CWIP
|
Construction work in progress
|
DOE
|
U.S. Department of Energy
|
EPA
|
U.S. Environmental Protection Agency
|
FASB
|
Financial Accounting Standards Board
|
FERC
|
Federal Energy Regulatory Commission
|
FFB
|
Federal Financing Bank
|
GAAP
|
U.S. generally accepted accounting principles
|
Georgia Power
|
Georgia Power Company
|
Gulf Power
|
Gulf Power Company
|
IGCC
|
Integrated coal gasification combined cycle
|
IRS
|
Internal Revenue Service
|
ITC
|
Investment tax credit
|
Kemper IGCC
|
IGCC facility under construction by Mississippi Power in Kemper County, Mississippi
|
KWH
|
Kilowatt-hour
|
LIBOR
|
London Interbank Offered Rate
|
Merger
|
The merger, effective July 1, 2016, of a wholly-owned, direct subsidiary of Southern Company with and into Southern Company Gas, with Southern Company Gas continuing as the surviving corporation
|
Mirror CWIP
|
A regulatory liability used by Mississippi Power to record customer refunds resulting from a 2015 Mississippi PSC order
|
Mississippi Power
|
Mississippi Power Company
|
mmBtu
|
Million British thermal units
|
Moody's
|
Moody's Investors Service, Inc.
|
MPUS
|
Mississippi Public Utilities Staff
|
MW
|
Megawatt
|
natural gas distribution utilities
|
Southern Company Gas' seven natural gas distribution utilities (Nicor Gas, Atlanta Gas Light, Virginia Natural Gas, Inc., Elizabethtown Gas, Florida City Gas, Chattanooga Gas Company, and Elkton Gas)
|
Term
|
Meaning
|
NCCR
|
Georgia Power's Nuclear Construction Cost Recovery
|
NDR
|
Alabama Power's Natural Disaster Reserve
|
Nicor Gas
|
Northern Illinois Gas Company, a wholly-owned subsidiary of Southern Company Gas
|
NRC
|
U.S. Nuclear Regulatory Commission
|
OCI
|
Other comprehensive income
|
Plant Vogtle Units 3 and 4
|
Two new nuclear generating units under construction at Georgia Power's Plant Vogtle
|
PowerSecure
|
PowerSecure, Inc.
|
power pool
|
The operating arrangement whereby the integrated generating resources of the traditional electric operating companies and Southern Power (excluding subsidiaries) are subject to joint commitment and dispatch in order to serve their combined load obligations
|
PPA
|
Power purchase agreements and contracts for differences that provide the owner of a renewable facility a certain fixed price for the electricity sold to the grid
|
PSC
|
Public Service Commission
|
PTC
|
Production tax credit
|
Rate CNP
|
Alabama Power's Rate Certificated New Plant
|
Rate CNP Compliance
|
Alabama Power's Rate Certificated New Plant Compliance
|
Rate CNP PPA
|
Alabama Power's Rate Certificated New Plant Power Purchase Agreement
|
Rate ECR
|
Alabama Power's Rate Energy Cost Recovery
|
Rate NDR
|
Alabama Power's Rate Natural Disaster Reserve
|
Rate RSE
|
Alabama Power's Rate Stabilization and Equalization plan
|
ROE
|
Return on equity
|
S&P
|
S&P Global Ratings, a division of S&P Global Inc.
|
SCS
|
Southern Company Services, Inc. (the Southern Company system service company)
|
SEC
|
U.S. Securities and Exchange Commission
|
SEGCO
|
Southern Electric Generating Company
|
SMEPA
|
South Mississippi Electric Power Association (now known as Cooperative Energy)
|
Southern Company Gas
|
Southern Company Gas (formerly known as AGL Resources Inc.) and its subsidiaries
|
Southern Company Gas Capital
|
Southern Company Gas Capital Corporation (formerly known as AGL Capital Corporation), a 100%-owned subsidiary of Southern Company Gas
|
Southern Company system
|
The Southern Company, the traditional electric operating companies, Southern Power, Southern Company Gas (as of July 1, 2016), SEGCO, Southern Nuclear, SCS, Southern LINC, PowerSecure (as of May 9, 2016), and other subsidiaries
|
Southern LINC
|
Southern Communications Services, Inc.
|
Southern Nuclear
|
Southern Nuclear Operating Company, Inc.
|
Southern Power
|
Southern Power Company and its subsidiaries
|
traditional electric operating companies
|
Alabama Power, Georgia Power, Gulf Power, and Mississippi Power
|
Westinghouse
|
Westinghouse Electric Company LLC
|
|
Amount
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Electricity business
|
$
|
2,571
|
|
|
$
|
2,401
|
|
|
$
|
1,969
|
|
Gas business
|
114
|
|
|
—
|
|
|
—
|
|
|||
Other business activities
|
(237
|
)
|
|
(34
|
)
|
|
(6
|
)
|
|||
Net Income
|
$
|
2,448
|
|
|
$
|
2,367
|
|
|
$
|
1,963
|
|
|
Amount
|
|
Increase (Decrease)
from Prior Year
|
||||||||
|
2016
|
|
2016
|
|
2015
|
||||||
|
(in millions)
|
||||||||||
Electric operating revenues
|
$
|
17,941
|
|
|
$
|
499
|
|
|
$
|
(964
|
)
|
Fuel
|
4,361
|
|
|
(389
|
)
|
|
(1,255
|
)
|
|||
Purchased power
|
750
|
|
|
105
|
|
|
(27
|
)
|
|||
Cost of other sales
|
58
|
|
|
58
|
|
|
—
|
|
|||
Other operations and maintenance
|
4,523
|
|
|
231
|
|
|
33
|
|
|||
Depreciation and amortization
|
2,233
|
|
|
213
|
|
|
91
|
|
|||
Taxes other than income taxes
|
1,039
|
|
|
44
|
|
|
16
|
|
|||
Estimated loss on Kemper IGCC
|
428
|
|
|
63
|
|
|
(503
|
)
|
|||
Total electric operating expenses
|
13,392
|
|
|
325
|
|
|
(1,645
|
)
|
|||
Operating income
|
4,549
|
|
|
174
|
|
|
681
|
|
|||
Allowance for equity funds used during construction
|
200
|
|
|
(26
|
)
|
|
(19
|
)
|
|||
Interest expense, net of amounts capitalized
|
931
|
|
|
157
|
|
|
(20
|
)
|
|||
Other income (expense), net
|
(75
|
)
|
|
(43
|
)
|
|
23
|
|
|||
Income taxes
|
1,091
|
|
|
(235
|
)
|
|
273
|
|
|||
Net income
|
2,652
|
|
|
183
|
|
|
432
|
|
|||
Less:
|
|
|
|
|
|
||||||
Dividends on preferred and preference stock of subsidiaries
|
45
|
|
|
(9
|
)
|
|
(14
|
)
|
|||
Net income attributable to noncontrolling interests
|
36
|
|
|
22
|
|
|
14
|
|
|||
Net Income Attributable to Southern Company
|
$
|
2,571
|
|
|
$
|
170
|
|
|
$
|
432
|
|
|
Amount
|
||||||
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Retail electric — prior year
|
$
|
14,987
|
|
|
$
|
15,550
|
|
Estimated change resulting from —
|
|
|
|
||||
Rates and pricing
|
427
|
|
|
375
|
|
||
Sales growth (decline)
|
(35
|
)
|
|
50
|
|
||
Weather
|
153
|
|
|
(59
|
)
|
||
Fuel and other cost recovery
|
(298
|
)
|
|
(929
|
)
|
||
Retail electric — current year
|
15,234
|
|
|
14,987
|
|
||
Wholesale electric revenues
|
1,926
|
|
|
1,798
|
|
||
Other electric revenues
|
698
|
|
|
657
|
|
||
Other revenues
|
83
|
|
|
—
|
|
||
Electric operating revenues
|
$
|
17,941
|
|
|
$
|
17,442
|
|
Percent change
|
2.9
|
%
|
|
(5.2
|
)%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Capacity and other
|
$
|
771
|
|
|
$
|
875
|
|
|
$
|
974
|
|
Energy
|
1,155
|
|
|
923
|
|
|
1,210
|
|
|||
Total
|
$
|
1,926
|
|
|
$
|
1,798
|
|
|
$
|
2,184
|
|
|
Total
KWHs
|
|
Total KWH
Percent Change
|
|
Weather-Adjusted
Percent Change
|
|||||||||
|
2016
|
|
2016
|
|
2015
|
|
2016
(*)
|
|
2015
(*)
|
|||||
|
(in billions)
|
|
|
|
|
|
|
|
|
|||||
Residential
|
53.3
|
|
|
2.3
|
%
|
|
(2.3
|
)%
|
|
0.2
|
%
|
|
0.4
|
%
|
Commercial
|
53.7
|
|
|
0.4
|
|
|
0.5
|
|
|
(1.0
|
)
|
|
0.9
|
|
Industrial
|
52.8
|
|
|
(2.1
|
)
|
|
(0.4
|
)
|
|
(2.2
|
)
|
|
(0.3
|
)
|
Other
|
0.9
|
|
|
(1.7
|
)
|
|
(1.4
|
)
|
|
(1.7
|
)
|
|
(1.3
|
)
|
Total retail
|
160.7
|
|
|
0.2
|
|
|
(0.7
|
)
|
|
(1.0
|
)%
|
|
0.3
|
%
|
Wholesale
|
34.9
|
|
|
14.4
|
|
|
(7.0
|
)
|
|
|
|
|
||
Total energy sales
|
195.6
|
|
|
2.4
|
%
|
|
(1.8
|
)%
|
|
|
|
|
(*)
|
In the first quarter 2015, Mississippi Power updated the methodology to estimate the unbilled revenue allocation among customer classes. This change did not have a significant impact on net income. The KWH sales variances in the above table reflect an adjustment to the estimated allocation of Mississippi Power's unbilled 2014 and first quarter 2015 KWH sales among customer classes that is consistent with the actual allocation in 2015 and 2016, respectively. Without this adjustment, 2016 weather-adjusted commercial sales decreased 0.9% and industrial KWH sales decreased 2.1% as compared to 2015. Without this adjustment, 2015 weather-adjusted commercial sales increased 0.8% and industrial KWH sales decreased 0.4% as compared to 2014.
|
|
2016
|
|
2015
|
|
2014
|
|||
Total generation
(in billions of KWHs)
|
188
|
|
|
187
|
|
|
191
|
|
Total purchased power
(in billions of KWHs)
|
16
|
|
|
13
|
|
|
12
|
|
Sources of generation
(percent)
—
|
|
|
|
|
|
|||
Coal
|
33
|
|
|
34
|
|
|
42
|
|
Nuclear
|
16
|
|
|
16
|
|
|
16
|
|
Gas
|
46
|
|
|
46
|
|
|
39
|
|
Hydro
|
2
|
|
|
3
|
|
|
3
|
|
Other Renewables
|
3
|
|
|
1
|
|
|
—
|
|
Cost of fuel, generated
(in cents per net KWH)
—
|
|
|
|
|
|
|||
Coal
|
3.04
|
|
|
3.55
|
|
|
3.81
|
|
Nuclear
|
0.81
|
|
|
0.79
|
|
|
0.87
|
|
Gas
|
2.48
|
|
|
2.60
|
|
|
3.63
|
|
Average cost of fuel, generated
(in cents per net KWH)
|
2.40
|
|
|
2.64
|
|
|
3.25
|
|
Average cost of purchased power
(in cents per net KWH)
(
*)
|
5.43
|
|
|
6.11
|
|
|
7.13
|
|
(*)
|
Average cost of purchased power includes fuel purchased by the Southern Company system for tolling agreements where power is generated by the provider.
|
|
Amount
|
||
|
2016
|
||
|
(in millions)
|
||
Operating revenues
|
$
|
1,652
|
|
Cost of natural gas
|
613
|
|
|
Cost of other sales
|
10
|
|
|
Other operations and maintenance
|
523
|
|
|
Depreciation and amortization
|
238
|
|
|
Taxes other than income taxes
|
71
|
|
|
Total operating expenses
|
1,455
|
|
|
Operating income
|
197
|
|
|
Earnings from equity method investments
|
60
|
|
|
Interest expense, net of amounts capitalized
|
81
|
|
|
Other income (expense), net
|
14
|
|
|
Income taxes
|
76
|
|
|
Net income
|
114
|
|
|
Less: Net income attributable to noncontrolling interests
|
—
|
|
|
Net Income Attributable to Southern Company Gas
|
$
|
114
|
|
|
Amount
|
|
Increase (Decrease)
from Prior Year
|
||||||||
|
2016
|
|
2016
|
|
2015
|
||||||
|
(in millions)
|
||||||||||
Operating revenues
|
$
|
303
|
|
|
$
|
256
|
|
|
$
|
(14
|
)
|
Cost of other sales
|
192
|
|
|
192
|
|
|
—
|
|
|||
Other operations and maintenance
|
194
|
|
|
70
|
|
|
29
|
|
|||
Depreciation and amortization
|
31
|
|
|
17
|
|
|
(2
|
)
|
|||
Taxes other than income taxes
|
3
|
|
|
1
|
|
|
—
|
|
|||
Total operating expenses
|
420
|
|
|
280
|
|
|
27
|
|
|||
Operating income (loss)
|
(117
|
)
|
|
(24
|
)
|
|
(41
|
)
|
|||
Interest expense
|
305
|
|
|
239
|
|
|
25
|
|
|||
Other income (expense), net
|
(31
|
)
|
|
(24
|
)
|
|
(18
|
)
|
|||
Income taxes
|
(216
|
)
|
|
(84
|
)
|
|
(56
|
)
|
|||
Net income (loss)
|
$
|
(237
|
)
|
|
$
|
(203
|
)
|
|
$
|
(28
|
)
|
Change in Assumption
|
Increase/(Decrease) in Total Benefit Expense for 2017
|
|
Increase/(Decrease) in Projected Obligation for Pension Plan at December 31, 2016
|
|
Increase/(Decrease) in Projected Obligation for Other Postretirement Benefit Plans at December 31, 2016
|
|
(in millions)
|
||||
25 basis point change in discount rate
|
$34/$(39)
|
|
$418/$(396)
|
|
$64/$(61)
|
25 basis point change in salaries
|
$20/$(19)
|
|
$97/$(94)
|
|
$–/$–
|
25 basis point change in long-term return on plan assets
|
$31/$(31)
|
|
N/A
|
|
N/A
|
•
|
the creditworthiness of the counterparties involved and the impact of credit enhancements (such as cash deposits and letters of credit);
|
•
|
events specific to a given counterparty; and
|
•
|
the impact of Southern Company's nonperformance risk on its liabilities.
|
|
Expires
|
|
|
|
Executable Term Loans
|
|
Expires Within One Year
|
||||||||||||||||||||||||||||
Company
|
2017
|
|
2018
|
|
2020
|
|
Total
|
|
Unused
|
|
One
Year
|
|
Two
Years
|
|
Term Out
|
|
No Term Out
|
||||||||||||||||||
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
||||||||||||||||||||||||||||
Southern Company
(a)
|
$
|
—
|
|
|
$
|
1,000
|
|
|
$
|
1,250
|
|
|
$
|
2,250
|
|
|
$
|
2,250
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Alabama Power
|
35
|
|
|
500
|
|
|
800
|
|
|
1,335
|
|
|
1,335
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35
|
|
|||||||||
Georgia Power
|
—
|
|
|
—
|
|
|
1,750
|
|
|
1,750
|
|
|
1,732
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Gulf Power
|
85
|
|
|
195
|
|
|
—
|
|
|
280
|
|
|
280
|
|
|
45
|
|
|
—
|
|
|
25
|
|
|
60
|
|
|||||||||
Mississippi Power
|
173
|
|
|
—
|
|
|
—
|
|
|
173
|
|
|
150
|
|
|
—
|
|
|
13
|
|
|
13
|
|
|
160
|
|
|||||||||
Southern Power Company
(b)
|
—
|
|
|
—
|
|
|
600
|
|
|
600
|
|
|
522
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Southern Company Gas
(c)
|
75
|
|
|
1,925
|
|
|
—
|
|
|
2,000
|
|
|
1,949
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
75
|
|
|||||||||
Other
|
55
|
|
|
—
|
|
|
—
|
|
|
55
|
|
|
55
|
|
|
20
|
|
|
—
|
|
|
20
|
|
|
35
|
|
|||||||||
Southern Company Consolidated
|
$
|
423
|
|
|
$
|
3,620
|
|
|
$
|
4,400
|
|
|
$
|
8,443
|
|
|
$
|
8,273
|
|
|
$
|
65
|
|
|
$
|
13
|
|
|
$
|
58
|
|
|
$
|
365
|
|
(a)
|
Represents the Southern Company parent entity.
|
(b)
|
Excludes credit agreements (Project Credit Facilities) assumed with the acquisition of certain solar facilities, which were non-recourse to Southern Power Company, the proceeds of which were used to finance project costs related to such solar facilities. See Note 12 to the financial statements under "
Southern Power
" for additional information. Also excludes a $120 million continuing letter of credit facility entered into by Southern Power in December 2016 for standby letters of credit expiring in 2019. At December 31, 2016, the total amount available under the letter of credit facility was $82 million.
|
(c)
|
Southern Company Gas, as the parent entity, guarantees the obligations of Southern Company Gas Capital, which is the borrower of $1.3 billion of these arrangements. Southern Company Gas' committed credit arrangements also include $700 million for which Nicor Gas is the borrower and which is restricted for working capital needs of Nicor Gas.
|
|
Short-term Debt at the End of the Period
|
|
Short-term Debt During the Period
(*)
|
||||||||||||||
|
Amount Outstanding
|
|
Weighted Average Interest Rate
|
|
Average Amount Outstanding
|
|
Weighted Average Interest Rate
|
|
Maximum Amount Outstanding
|
||||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
|
(in millions)
|
||||||||
December 31, 2016:
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
$
|
1,909
|
|
|
1.1
|
%
|
|
$
|
976
|
|
|
0.8
|
%
|
|
$
|
1,970
|
|
Short-term bank debt
|
123
|
|
|
1.7
|
%
|
|
176
|
|
|
1.7
|
%
|
|
500
|
|
|||
Total
|
$
|
2,032
|
|
|
1.1
|
%
|
|
$
|
1,152
|
|
|
1.1
|
%
|
|
|
||
December 31, 2015:
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
$
|
740
|
|
|
0.7
|
%
|
|
$
|
842
|
|
|
0.4
|
%
|
|
$
|
1,563
|
|
Short-term bank debt
|
500
|
|
|
1.4
|
%
|
|
444
|
|
|
1.1
|
%
|
|
795
|
|
|||
Total
|
$
|
1,240
|
|
|
0.9
|
%
|
|
$
|
1,286
|
|
|
0.5
|
%
|
|
|
||
December 31, 2014:
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
$
|
803
|
|
|
0.3
|
%
|
|
$
|
754
|
|
|
0.2
|
%
|
|
$
|
1,582
|
|
Short-term bank debt
|
—
|
|
|
—
|
%
|
|
98
|
|
|
0.8
|
%
|
|
400
|
|
|||
Total
|
$
|
803
|
|
|
0.3
|
%
|
|
$
|
852
|
|
|
0.3
|
%
|
|
|
(*)
|
Average and maximum amounts are based upon daily balances during the twelve-month periods ended
December 31, 2016
,
2015
, and
2014
.
|
Company
|
Senior
Note
Issuances
|
|
Senior
Note
Maturities
and
Redemptions
|
|
Revenue
Bond
Maturities, Redemptions,
and Repurchases
|
|
Other
Long-Term
Debt
Issuances
|
|
Other
Long-Term
Debt
Redemptions
and
Maturities
(a)
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Southern Company
(b)
|
$
|
8,500
|
|
|
$
|
500
|
|
|
$
|
—
|
|
|
$
|
1,350
|
|
|
$
|
—
|
|
Alabama Power
|
400
|
|
|
200
|
|
|
—
|
|
|
45
|
|
|
—
|
|
|||||
Georgia Power
|
650
|
|
|
700
|
|
|
4
|
|
|
425
|
|
|
10
|
|
|||||
Gulf Power
|
—
|
|
|
235
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|||||
Mississippi Power
|
—
|
|
|
300
|
|
|
—
|
|
|
1,400
|
|
|
653
|
|
|||||
Southern Power
|
2,831
|
|
|
200
|
|
|
—
|
|
|
65
|
|
|
86
|
|
|||||
Southern Company Gas
(c)
|
900
|
|
|
420
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
79
|
|
|
65
|
|
|||||
Elimination
(d)
|
—
|
|
|
—
|
|
|
—
|
|
|
(279
|
)
|
|
(228
|
)
|
|||||
Southern Company Consolidated
|
$
|
13,281
|
|
|
$
|
2,555
|
|
|
$
|
4
|
|
|
$
|
3,087
|
|
|
$
|
586
|
|
(a)
|
Includes reductions in capital lease obligations resulting from cash payments under capital leases.
|
(b)
|
Represents the Southern Company parent entity.
|
(c)
|
Reflects only long-term debt financing activities occurring subsequent to completion of the Merger. The senior notes were issued by Southern Company Gas Capital and guaranteed by Southern Company Gas, as the parent entity.
|
(d)
|
Includes intercompany loans from Southern Company to Mississippi Power and PowerSecure, as well as reductions in affiliate capital lease obligations at Georgia Power. These transactions are eliminated in Southern Company's Consolidated Financial Statements.
|
•
|
$0.5 billion of 1.55% Senior Notes due July 1, 2018;
|
•
|
$1.0 billion of 1.85% Senior Notes due July 1, 2019;
|
•
|
$1.5 billion of 2.35% Senior Notes due July 1, 2021;
|
•
|
$1.25 billion of 2.95% Senior Notes due July 1, 2023;
|
•
|
$1.75 billion of 3.25% Senior Notes due July 1, 2026;
|
•
|
$0.5 billion of 4.25% Senior Notes due July 1, 2036; and
|
•
|
$2.0 billion of 4.40% Senior Notes due July 1, 2046.
|
Credit Ratings
|
Maximum
Potential
Collateral
Requirements
|
||
|
(in millions)
|
||
At BBB and/or Baa2
|
$
|
39
|
|
At BBB- and/or Baa3
|
$
|
691
|
|
At BB+ and/or Ba1
(*)
|
$
|
2,723
|
|
(*)
|
Any additional credit rating downgrades at or below BB- and/or Ba3 could increase collateral requirements up to an additional $91 million.
|
|
2016
Changes
|
|
2015
Changes
|
||||
|
Fair Value
|
||||||
|
(in millions)
|
||||||
Contracts outstanding at the beginning of the period, assets (liabilities), net
|
$
|
(213
|
)
|
|
$
|
(188
|
)
|
Acquisitions
|
(54
|
)
|
|
—
|
|
||
Contracts realized or settled
|
141
|
|
|
142
|
|
||
Current period changes
(*)
|
171
|
|
|
(167
|
)
|
||
Contracts outstanding at the end of the period, assets (liabilities), net
|
$
|
45
|
|
|
$
|
(213
|
)
|
(*)
|
Current period changes also include the changes in fair value of new contracts entered into during the period, if any.
|
|
Fair Value Measurements
|
||||||||||||||
|
December 31, 2016
|
||||||||||||||
|
Total
Fair Value
|
|
Maturity
|
||||||||||||
|
|
Year 1
|
|
Years 2&3
|
|
Years 4&5
|
|||||||||
|
(in millions)
|
||||||||||||||
Level 1
|
$
|
(7
|
)
|
|
$
|
15
|
|
|
$
|
(15
|
)
|
|
$
|
(7
|
)
|
Level 2
|
52
|
|
|
52
|
|
|
(7
|
)
|
|
7
|
|
||||
Level 3
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Fair value of contracts outstanding at end of period
|
$
|
45
|
|
|
$
|
67
|
|
|
$
|
(22
|
)
|
|
$
|
—
|
|
|
2017
|
|
2018-
2019
|
|
2020-
2021
|
|
After
2021
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Long-term debt
(a)
—
|
|
|
|
|
|
|
|
|
|
||||||||||
Principal
|
$
|
2,556
|
|
|
$
|
7,025
|
|
|
$
|
4,448
|
|
|
$
|
30,890
|
|
|
$
|
44,919
|
|
Interest
|
1,635
|
|
|
3,034
|
|
|
2,592
|
|
|
24,055
|
|
|
31,316
|
|
|||||
Preferred and preference stock dividends
(b)
|
45
|
|
|
91
|
|
|
91
|
|
|
—
|
|
|
227
|
|
|||||
Financial derivative obligations
(c)
|
516
|
|
|
101
|
|
|
12
|
|
|
1
|
|
|
630
|
|
|||||
Operating leases
(d)
|
152
|
|
|
247
|
|
|
190
|
|
|
1,195
|
|
|
1,784
|
|
|||||
Capital leases
(d)
|
16
|
|
|
32
|
|
|
22
|
|
|
79
|
|
|
149
|
|
|||||
Unrecognized tax benefits
(e)
|
484
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
484
|
|
|||||
Pipeline charges, storage capacity, and gas supply
(f)
|
822
|
|
|
1,049
|
|
|
746
|
|
|
2,591
|
|
|
5,208
|
|
|||||
Asset management agreements
(g)
|
10
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|||||
Standby letters of credit, performance/surety bonds
(h)
|
85
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
86
|
|
|||||
Purchase commitments
—
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Capital
(i)
|
8,797
|
|
|
14,649
|
|
|
12,055
|
|
|
—
|
|
|
35,501
|
|
|||||
Fuel
(j)
|
3,763
|
|
|
4,379
|
|
|
2,248
|
|
|
7,095
|
|
|
17,485
|
|
|||||
Purchased power
(k)
|
362
|
|
|
753
|
|
|
782
|
|
|
2,651
|
|
|
4,548
|
|
|||||
Other
(l)
|
479
|
|
|
560
|
|
|
777
|
|
|
3,024
|
|
|
4,840
|
|
|||||
Trusts —
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Nuclear decommissioning
(m)
|
5
|
|
|
11
|
|
|
11
|
|
|
99
|
|
|
126
|
|
|||||
Pension and other postretirement benefit plans
(n)
|
146
|
|
|
293
|
|
|
—
|
|
|
—
|
|
|
439
|
|
|||||
Total
|
$
|
19,873
|
|
|
$
|
32,232
|
|
|
$
|
23,974
|
|
|
$
|
71,680
|
|
|
$
|
147,759
|
|
(a)
|
All amounts are reflected based on final maturity dates except for amounts related to FFB borrowings. As it relates to the FFB borrowings, the final maturity date is February 20, 2044; however, principal amortization is reflected beginning in 2020. See Note 6 to the financial statements under "
DOE Loan Guarantee Borrowings
" for additional information. Southern Company and its subsidiaries plan to continue, when economically feasible, to retire higher-cost securities and replace these obligations with lower-cost capital if market conditions permit. Variable rate interest obligations are estimated based on rates as of January 1,
2017
, as reflected in the statements of capitalization. Fixed rates include, where applicable, the effects of interest rate derivatives employed to manage interest rate risk.
Long-term debt principal for 2017 includes $40 million of pollution control revenue bonds that are classified on the balance sheet at
December 31, 2016
as short-term
since they are variable rate demand obligations that are supported by short-term credit facilities; however, the final maturity date is in 2028
.
Long-term debt excludes capital lease amounts (shown separately).
|
(b)
|
Represents preferred and preference stock of subsidiaries. Preferred and preference stock do not mature; therefore, amounts are provided for the next five years only.
|
(c)
|
Includes derivative liabilities related to cash flow hedges of forecasted debt, as well as energy-related derivatives. For additional information, see Notes 1 and 11 to the financial statements.
|
(d)
|
Excludes PPAs that are accounted for as leases and included in "Purchased power."
|
(e)
|
See Note 5 to the financial statements under "
Unrecognized Tax Benefits
" for additional information.
|
(f)
|
Includes charges recoverable through a natural gas cost recovery mechanism, or alternatively billed to marketers selling retail natural gas, and demand charges associated with Southern Company Gas' wholesale gas services. The gas supply balance includes amounts for gas commodity purchase commitments associated with Southern Company Gas' gas marketing services of
33 million
mmBtu at floating gas prices calculated using forward natural gas prices at
December 31, 2016
and valued at
$106 million
. Southern Company Gas provides guarantees to certain gas suppliers for certain of its subsidiaries in support of payment obligations.
|
(g)
|
Represents fixed-fee minimum payments for asset management agreements associated with wholesale gas services.
|
(h)
|
Guarantees are provided to certain municipalities and other agencies and certain natural gas suppliers in support of payment obligations.
|
(i)
|
The Southern Company system provides estimated capital expenditures for a five-year period, including capital expenditures associated with environmental regulations. These amounts exclude contractual purchase commitments for nuclear fuel and capital expenditures covered under long-term service agreements which are reflected in "Fuel" and "Other," respectively. At
December 31, 2016
, significant purchase commitments were outstanding in connection with the construction program. See FUTURE EARNINGS POTENTIAL – "
Environmental Matters
–
Environmental Statutes and Regulations
" herein for additional information.
|
(j)
|
Primarily includes commitments to purchase coal, nuclear fuel, and natural gas, as well as the related transportation and storage. In most cases, these contracts contain provisions for price escalation, minimum purchase levels, and other financial commitments. Natural gas purchase commitments are based on various indices at the time of delivery. Amounts reflected for natural gas purchase commitments have been estimated based on the New York Mercantile Exchange future prices at
December 31, 2016
.
|
(k)
|
Estimated minimum long-term obligations for various PPA purchases from gas-fired, biomass, and wind-powered facilities. Includes a total of $292 million of biomass PPAs that is contingent upon the counterparties meeting specified contract dates for commercial operation. Subsequent to December 31, 2016, the specified contract dates for commercial operation were extended from 2017 to 2019 and may change further as a result of regulatory action. See FUTURE EARNINGS POTENTIAL – "
Regulatory Matters
–
Renewables
" herein for additional information.
|
(l)
|
Includes long-term service agreements, contracts for the procurement of limestone, contractual environmental remediation liabilities, and operation and maintenance agreements. Long-term service agreements include price escalation based on inflation indices.
|
(m)
|
Projections of nuclear decommissioning trust fund contributions for Plant Hatch and Plant Vogtle Units 1 and 2 are based on the 2013 ARP
for Georgia Power. Alabama Power also has external trust funds for nuclear decommissioning costs; however, Alabama Power currently has no additional funding requirements.
See Note 1 to the financial statements under "Nuclear Decommissioning" for additional information.
|
(n)
|
The Southern Company system forecasts contributions to the pension and other postretirement benefit plans over a three-year period. Southern Company anticipates no mandatory contributions to the qualified pension plans during the next three years. Amounts presented represent estimated benefit payments for the nonqualified pension plans, estimated non-trust benefit payments for the other postretirement benefit plans, and estimated contributions to the other postretirement benefit plan trusts, all of which will be made from corporate assets of Southern Company's subsidiaries. See Note 2 to the financial statements for additional information related to the pension and other postretirement benefit plans, including estimated benefit payments. Certain benefit payments will be made through the related benefit plans. Other benefit payments will be made from corporate assets of Southern Company's subsidiaries.
|
•
|
the impact of recent and future federal and state regulatory changes, including environmental laws regulating emissions, discharges, and disposal to air, water, and land
,
and also changes in tax and other laws and regulations to which
Southern Company and its subsidiaries are
subject, including potential tax reform legislation, as well as changes in application of existing laws and regulations;
|
•
|
current and future litigation, regulatory investigations, proceedings, or inquiries
;
|
•
|
the effects, extent, and timing of the entry of additional competition in the markets in which
Southern Company's subsidiaries operate;
|
•
|
variations in demand for
electricity and natural gas,
including those relating to weather, the general economy and recovery from the last recession, population and business growth (and declines), the effects of energy conservation and efficiency measures, including from the development and deployment of alternative energy sources such as self-generation and distributed generation technologies, and any potential economic impacts resulting from federal fiscal decisions;
|
•
|
available sources and costs of
natural gas and other
fuels;
|
•
|
limits on pipeline capacity;
|
•
|
effects of inflation;
|
•
|
the ability to control costs and avoid cost overruns during the development
, construction, and operation of
facilities, which include the development and construction of
generating facilities
with designs that have not been finalized or previously constructed, including changes in labor costs and productivity, adverse weather conditions, shortages and inconsistent quality of equipment, materials, and labor
,
sustaining nitrogen supply,
contractor or supplier delay, non-performance under
construction, operating,
or other agreements, operational readiness, including specialized operator training and required site safety programs, unforeseen engineering or design problems, start-up activities (including major equipment failure and system integration), and/or operational performance (including additional costs to satisfy any operational parameters ultimately adopted by
any PSC);
|
•
|
the ability
to construct facilities in accordance with the requirements of permits and licenses,
to satisfy any environmental performance standards
and
the requirements of tax credits and other incentives
,
and to integrate facilities into the Southern Company system upon completion of construction;
|
•
|
investment performance of
the Southern Company system's
employee and retiree benefit plans
and
nuclear decommissioning trust funds;
|
•
|
advances in technology;
|
•
|
ongoing renewable energy partnerships and development agreements;
|
•
|
state and federal rate regulations
and the impact of pending and future rate cases and negotiations, including rate
actions relating
to fuel and other cost recovery mechanisms;
|
•
|
legal proceedings and regulatory approvals and actions related to Plant Vogtle Units 3 and 4, including Georgia PSC approvals and NRC actions;
|
•
|
actions related to cost recovery for the Kemper IGCC, including the ultimate impact of the 2015 decision of the Mississippi Supreme Court, the Mississippi PSC's December 2015 rate order, and related legal or regulatory proceedings, Mississippi PSC review of the prudence of Kemper IGCC costs and approval of further permanent rate recovery plans, actions relating to proposed securitization,
satisfaction of requirements to utilize grants, and the ultimate impact of the termination of the proposed sale of an interest in the Kemper IGCC to SMEPA;
|
•
|
the ability to successfully operate the electric utilities' generating, transmission, and distribution facilities
and Southern Company Gas' natural gas distribution and storage facilities
and the successful performance of necessary corporate functions;
|
•
|
the inherent risks involved in operating
and constructing
nuclear generating facilities, including environmental, health, regulatory, natural disaster, terrorism, and financial risks;
|
•
|
the inherent risks involved in transporting and storing natural gas;
|
•
|
the performance of projects undertaken by the non-utility businesses and the success of efforts to invest in and develop new opportunities;
|
•
|
internal restructuring or other restructuring options that may be pursued;
|
•
|
potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to
Southern Company or its subsidiaries;
|
•
|
the possibility that the anticipated benefits from the Merger cannot be fully realized or may take longer to realize than expected, the possibility that costs related to the integration of Southern Company and Southern Company Gas will be greater than expected, the ability to retain and hire key personnel and maintain relationships with customers, suppliers, or other business partners, and the diversion of management time on integration-related issues;
|
•
|
the ability of counterparties of
Southern Company and its subsidiaries
to make payments as and when due and to perform as required;
|
•
|
the ability to obtain new short- and long-term contracts with wholesale customers;
|
•
|
the direct or indirect effect on the
Southern Company system's
business resulting from cyber intrusion or terrorist incidents and the threat of terrorist incidents;
|
•
|
interest rate fluctuations and financial market conditions and the results of financing efforts;
|
•
|
changes in Southern Company's and any of its subsidiaries'
credit ratings, including impacts on interest rates, access to capital markets, and collateral requirements;
|
•
|
the impacts of any sovereign financial issues, including impacts on interest rates, access to capital markets, impacts on foreign currency exchange rates, counterparty performance, and the economy in general
, as well as potential impacts on the benefits of the DOE loan guarantees;
|
•
|
the ability of
Southern Company's electric utilities
to obtain additional generating capacity (or sell excess generating capacity) at competitive prices;
|
•
|
catastrophic events such as fires, earthquakes, explosions, floods, tornadoes,
hurricanes and other storms, droughts, pandemic health events such as influenzas, or other similar occurrences;
|
•
|
the direct or indirect effects on the
Southern Company system's
business resulting from incidents affecting the U.S. electric grid
, natural gas pipeline infrastructure
,
or operation of generating
or storage
resources;
|
•
|
the effect of accounting pronouncements issued periodically by standard-setting bodies; and
|
•
|
other factors discussed elsewhere herein and in other reports (including the Form 10-K) filed by
Southern Company
from time to time with the SEC.
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
||||||
Retail electric revenues
|
$
|
15,234
|
|
|
$
|
14,987
|
|
|
$
|
15,550
|
|
Wholesale electric revenues
|
1,926
|
|
|
1,798
|
|
|
2,184
|
|
|||
Other electric revenues
|
698
|
|
|
657
|
|
|
672
|
|
|||
Natural gas revenues
|
1,596
|
|
|
—
|
|
|
—
|
|
|||
Other revenues
|
442
|
|
|
47
|
|
|
61
|
|
|||
Total operating revenues
|
19,896
|
|
|
17,489
|
|
|
18,467
|
|
|||
Operating Expenses:
|
|
|
|
|
|
||||||
Fuel
|
4,361
|
|
|
4,750
|
|
|
6,005
|
|
|||
Purchased power
|
750
|
|
|
645
|
|
|
672
|
|
|||
Cost of natural gas
|
613
|
|
|
—
|
|
|
—
|
|
|||
Cost of other sales
|
260
|
|
|
—
|
|
|
—
|
|
|||
Other operations and maintenance
|
5,240
|
|
|
4,416
|
|
|
4,354
|
|
|||
Depreciation and amortization
|
2,502
|
|
|
2,034
|
|
|
1,945
|
|
|||
Taxes other than income taxes
|
1,113
|
|
|
997
|
|
|
981
|
|
|||
Estimated loss on Kemper IGCC
|
428
|
|
|
365
|
|
|
868
|
|
|||
Total operating expenses
|
15,267
|
|
|
13,207
|
|
|
14,825
|
|
|||
Operating Income
|
4,629
|
|
|
4,282
|
|
|
3,642
|
|
|||
Other Income and (Expense):
|
|
|
|
|
|
||||||
Allowance for equity funds used during construction
|
202
|
|
|
226
|
|
|
245
|
|
|||
Earnings from equity method investments
|
59
|
|
|
—
|
|
|
—
|
|
|||
Interest expense, net of amounts capitalized
|
(1,317
|
)
|
|
(840
|
)
|
|
(835
|
)
|
|||
Other income (expense), net
|
(93
|
)
|
|
(39
|
)
|
|
(44
|
)
|
|||
Total other income and (expense)
|
(1,149
|
)
|
|
(653
|
)
|
|
(634
|
)
|
|||
Earnings Before Income Taxes
|
3,480
|
|
|
3,629
|
|
|
3,008
|
|
|||
Income taxes
|
951
|
|
|
1,194
|
|
|
977
|
|
|||
Consolidated Net Income
|
2,529
|
|
|
2,435
|
|
|
2,031
|
|
|||
Less:
|
|
|
|
|
|
||||||
Dividends on preferred and preference stock of subsidiaries
|
45
|
|
|
54
|
|
|
68
|
|
|||
Net income attributable to noncontrolling interests
|
36
|
|
|
14
|
|
|
—
|
|
|||
Consolidated Net Income Attributable to Southern Company
|
$
|
2,448
|
|
|
$
|
2,367
|
|
|
$
|
1,963
|
|
Common Stock Data:
|
|
|
|
|
|
||||||
Earnings per share (EPS) —
|
|
|
|
|
|
||||||
Basic EPS
|
$
|
2.57
|
|
|
$
|
2.60
|
|
|
$
|
2.19
|
|
Diluted EPS
|
2.55
|
|
|
2.59
|
|
|
2.18
|
|
|||
Average number of shares of common stock outstanding — (in millions)
|
|
|
|
|
|
||||||
Basic
|
951
|
|
|
910
|
|
|
897
|
|
|||
Diluted
|
958
|
|
|
914
|
|
|
901
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Consolidated Net Income
|
$
|
2,529
|
|
|
$
|
2,435
|
|
|
$
|
2,031
|
|
Other comprehensive income:
|
|
|
|
|
|
||||||
Qualifying hedges:
|
|
|
|
|
|
||||||
Changes in fair value, net of tax of $(84), $(8), and $(6), respectively
|
(136
|
)
|
|
(13
|
)
|
|
(10
|
)
|
|||
Reclassification adjustment for amounts included in net
income, net of tax of $43, $4, and $3, respectively |
69
|
|
|
6
|
|
|
5
|
|
|||
Pension and other postretirement benefit plans:
|
|
|
|
|
|
||||||
Benefit plan net gain (loss), net of tax of $10, $(1), and $(32),
respectively |
13
|
|
|
(2
|
)
|
|
(51
|
)
|
|||
Reclassification adjustment for amounts included in net income, net of
tax of $3, $4, and $2, respectively |
4
|
|
|
7
|
|
|
3
|
|
|||
Total other comprehensive income (loss)
|
(50
|
)
|
|
(2
|
)
|
|
(53
|
)
|
|||
Less:
|
|
|
|
|
|
||||||
Dividends on preferred and preference stock of subsidiaries
|
45
|
|
|
54
|
|
|
68
|
|
|||
Comprehensive income attributable to noncontrolling interests
|
36
|
|
|
14
|
|
|
—
|
|
|||
Consolidated Comprehensive Income Attributable to Southern Company
|
$
|
2,398
|
|
|
$
|
2,365
|
|
|
$
|
1,910
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
|
|
(in millions)
|
||||||||
Operating Activities:
|
|
|
|
|
|
||||||
Consolidated net income
|
$
|
2,529
|
|
|
$
|
2,435
|
|
|
$
|
2,031
|
|
Adjustments to reconcile consolidated net income
to net cash provided from operating activities — |
|
|
|
|
|
||||||
Depreciation and amortization, total
|
2,923
|
|
|
2,395
|
|
|
2,293
|
|
|||
Deferred income taxes
|
(127
|
)
|
|
1,404
|
|
|
709
|
|
|||
Collateral deposits
|
(102
|
)
|
|
—
|
|
|
—
|
|
|||
Allowance for equity funds used during construction
|
(202
|
)
|
|
(226
|
)
|
|
(245
|
)
|
|||
Pension, postretirement, and other employee benefits
|
(65
|
)
|
|
83
|
|
|
(9
|
)
|
|||
Pension and postretirement funding
|
(1,029
|
)
|
|
(7
|
)
|
|
(506
|
)
|
|||
Settlement of asset retirement obligations
|
(171
|
)
|
|
(37
|
)
|
|
(17
|
)
|
|||
Stock based compensation expense
|
121
|
|
|
99
|
|
|
63
|
|
|||
Hedge settlements
|
(233
|
)
|
|
(17
|
)
|
|
—
|
|
|||
Estimated loss on Kemper IGCC
|
428
|
|
|
365
|
|
|
868
|
|
|||
Income taxes receivable, non-current
|
(122
|
)
|
|
(413
|
)
|
|
—
|
|
|||
Other, net
|
(36
|
)
|
|
(33
|
)
|
|
13
|
|
|||
Changes in certain current assets and liabilities —
|
|
|
|
|
|
||||||
-Receivables
|
(544
|
)
|
|
243
|
|
|
(352
|
)
|
|||
-Fossil fuel for generation
|
178
|
|
|
61
|
|
|
408
|
|
|||
-Natural gas for sale
|
(226
|
)
|
|
—
|
|
|
—
|
|
|||
-Materials and supplies
|
(31
|
)
|
|
(44
|
)
|
|
(67
|
)
|
|||
-Other current assets
|
(174
|
)
|
|
(108
|
)
|
|
(57
|
)
|
|||
-Accounts payable
|
301
|
|
|
(353
|
)
|
|
267
|
|
|||
-Accrued taxes
|
1,456
|
|
|
352
|
|
|
(105
|
)
|
|||
-Accrued compensation
|
36
|
|
|
(41
|
)
|
|
255
|
|
|||
-Retail fuel cost over recovery — short-term
|
(231
|
)
|
|
289
|
|
|
(23
|
)
|
|||
-Mirror CWIP
|
—
|
|
|
(271
|
)
|
|
180
|
|
|||
-Other current liabilities
|
215
|
|
|
98
|
|
|
109
|
|
|||
Net cash provided from operating activities
|
4,894
|
|
|
6,274
|
|
|
5,815
|
|
|||
Investing Activities:
|
|
|
|
|
|
||||||
Business acquisitions, net of cash acquired
|
(10,689
|
)
|
|
(1,719
|
)
|
|
(731
|
)
|
|||
Property additions
|
(7,310
|
)
|
|
(5,674
|
)
|
|
(5,246
|
)
|
|||
Investment in restricted cash
|
(733
|
)
|
|
(160
|
)
|
|
(11
|
)
|
|||
Distribution of restricted cash
|
742
|
|
|
154
|
|
|
57
|
|
|||
Nuclear decommissioning trust fund purchases
|
(1,160
|
)
|
|
(1,424
|
)
|
|
(916
|
)
|
|||
Nuclear decommissioning trust fund sales
|
1,154
|
|
|
1,418
|
|
|
914
|
|
|||
Cost of removal, net of salvage
|
(245
|
)
|
|
(167
|
)
|
|
(170
|
)
|
|||
Change in construction payables, net
|
(121
|
)
|
|
402
|
|
|
(107
|
)
|
|||
Investment in unconsolidated subsidiaries
|
(1,444
|
)
|
|
—
|
|
|
—
|
|
|||
Prepaid long-term service agreement
|
(134
|
)
|
|
(197
|
)
|
|
(181
|
)
|
|||
Other investing activities
|
(108
|
)
|
|
87
|
|
|
(17
|
)
|
|||
Net cash used for investing activities
|
(20,048
|
)
|
|
(7,280
|
)
|
|
(6,408
|
)
|
|||
Financing Activities:
|
|
|
|
|
|
||||||
Increase (decrease) in notes payable, net
|
1,228
|
|
|
73
|
|
|
(676
|
)
|
|||
Proceeds —
|
|
|
|
|
|
||||||
Long-term debt
|
16,368
|
|
|
7,029
|
|
|
3,169
|
|
|||
Interest-bearing refundable deposit
|
—
|
|
|
—
|
|
|
125
|
|
|||
Common stock
|
3,758
|
|
|
256
|
|
|
806
|
|
|||
Short-term borrowings
|
—
|
|
|
755
|
|
|
—
|
|
|||
Redemptions and repurchases —
|
|
|
|
|
|
||||||
Long-term debt
|
(3,145
|
)
|
|
(3,604
|
)
|
|
(816
|
)
|
|||
Common stock
|
—
|
|
|
(115
|
)
|
|
(5
|
)
|
|||
Interest-bearing refundable deposits
|
—
|
|
|
(275
|
)
|
|
—
|
|
|||
Preferred and preference stock
|
—
|
|
|
(412
|
)
|
|
—
|
|
|||
Short-term borrowings
|
(478
|
)
|
|
(255
|
)
|
|
—
|
|
|||
Distributions to noncontrolling interests
|
(72
|
)
|
|
(18
|
)
|
|
(1
|
)
|
|||
Capital contributions from noncontrolling interests
|
682
|
|
|
341
|
|
|
8
|
|
|||
Purchase of membership interests from noncontrolling interests
|
(129
|
)
|
|
—
|
|
|
—
|
|
|||
Payment of common stock dividends
|
(2,104
|
)
|
|
(1,959
|
)
|
|
(1,866
|
)
|
|||
Other financing activities
|
(383
|
)
|
|
(116
|
)
|
|
(100
|
)
|
|||
Net cash provided from financing activities
|
15,725
|
|
|
1,700
|
|
|
644
|
|
|||
Net Change in Cash and Cash Equivalents
|
571
|
|
|
694
|
|
|
51
|
|
|||
Cash and Cash Equivalents at Beginning of Year
|
1,404
|
|
|
710
|
|
|
659
|
|
|||
Cash and Cash Equivalents at End of Year
|
$
|
1,975
|
|
|
$
|
1,404
|
|
|
$
|
710
|
|
Assets
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,975
|
|
|
$
|
1,404
|
|
Receivables —
|
|
|
|
||||
Customer accounts receivable
|
1,565
|
|
|
1,058
|
|
||
Energy marketing receivable
|
623
|
|
|
—
|
|
||
Unbilled revenues
|
706
|
|
|
397
|
|
||
Under recovered regulatory clause revenues
|
18
|
|
|
63
|
|
||
Income taxes receivable, current
|
544
|
|
|
144
|
|
||
Other accounts and notes receivable
|
377
|
|
|
398
|
|
||
Accumulated provision for uncollectible accounts
|
(43
|
)
|
|
(13
|
)
|
||
Materials and supplies
|
1,462
|
|
|
1,061
|
|
||
Fossil fuel for generation
|
689
|
|
|
868
|
|
||
Natural gas for sale
|
631
|
|
|
—
|
|
||
Prepaid expenses
|
364
|
|
|
495
|
|
||
Other regulatory assets, current
|
581
|
|
|
580
|
|
||
Other current assets
|
230
|
|
|
71
|
|
||
Total current assets
|
9,722
|
|
|
6,526
|
|
||
Property, Plant, and Equipment:
|
|
|
|
||||
In service
|
98,416
|
|
|
75,118
|
|
||
Less accumulated depreciation
|
29,852
|
|
|
24,253
|
|
||
Plant in service, net of depreciation
|
68,564
|
|
|
50,865
|
|
||
Other utility plant, net
|
—
|
|
|
233
|
|
||
Nuclear fuel, at amortized cost
|
905
|
|
|
934
|
|
||
Construction work in progress
|
8,977
|
|
|
9,082
|
|
||
Total property, plant, and equipment
|
78,446
|
|
|
61,114
|
|
||
Other Property and Investments:
|
|
|
|
||||
Goodwill
|
6,251
|
|
|
2
|
|
||
Equity investments in unconsolidated subsidiaries
|
1,549
|
|
|
6
|
|
||
Other intangible assets, net of amortization of $62 and $12
at December 31, 2016 and December 31, 2015, respectively |
970
|
|
|
317
|
|
||
Nuclear decommissioning trusts, at fair value
|
1,606
|
|
|
1,512
|
|
||
Leveraged leases
|
774
|
|
|
755
|
|
||
Miscellaneous property and investments
|
270
|
|
|
160
|
|
||
Total other property and investments
|
11,420
|
|
|
2,752
|
|
||
Deferred Charges and Other Assets:
|
|
|
|
||||
Deferred charges related to income taxes
|
1,629
|
|
|
1,560
|
|
||
Unamortized loss on reacquired debt
|
223
|
|
|
227
|
|
||
Other regulatory assets, deferred
|
6,851
|
|
|
4,989
|
|
||
Income taxes receivable, non-current
|
11
|
|
|
413
|
|
||
Other deferred charges and assets
|
1,395
|
|
|
737
|
|
||
Total deferred charges and other assets
|
10,109
|
|
|
7,926
|
|
||
Total Assets
|
$
|
109,697
|
|
|
$
|
78,318
|
|
Liabilities and Stockholders' Equity
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
||||
Securities due within one year
|
$
|
2,587
|
|
|
$
|
2,674
|
|
Notes payable
|
2,241
|
|
|
1,376
|
|
||
Energy marketing trade payables
|
597
|
|
|
—
|
|
||
Accounts payable
|
2,228
|
|
|
1,905
|
|
||
Customer deposits
|
558
|
|
|
404
|
|
||
Accrued taxes —
|
|
|
|
||||
Accrued income taxes
|
193
|
|
|
9
|
|
||
Unrecognized tax benefits
|
385
|
|
|
10
|
|
||
Other accrued taxes
|
667
|
|
|
484
|
|
||
Accrued interest
|
518
|
|
|
249
|
|
||
Accrued compensation
|
915
|
|
|
777
|
|
||
Asset retirement obligations, current
|
378
|
|
|
217
|
|
||
Liabilities from risk management activities, net of collateral
|
107
|
|
|
156
|
|
||
Acquisitions payable
|
489
|
|
|
—
|
|
||
Other regulatory liabilities, current
|
236
|
|
|
278
|
|
||
Over recovered regulatory clause revenues, current
|
135
|
|
|
106
|
|
||
Other current liabilities
|
683
|
|
|
484
|
|
||
Total current liabilities
|
12,917
|
|
|
9,129
|
|
||
Long-Term Debt
(
See accompanying statements
)
|
42,629
|
|
|
24,688
|
|
||
Deferred Credits and Other Liabilities:
|
|
|
|
||||
Accumulated deferred income taxes
|
14,092
|
|
|
12,322
|
|
||
Deferred credits related to income taxes
|
219
|
|
|
187
|
|
||
Accumulated deferred investment tax credits
|
2,228
|
|
|
1,219
|
|
||
Employee benefit obligations
|
2,299
|
|
|
2,582
|
|
||
Asset retirement obligations, deferred
|
4,136
|
|
|
3,542
|
|
||
Unrecognized tax benefits, deferred
|
—
|
|
|
370
|
|
||
Accrued environmental remediation
|
397
|
|
|
42
|
|
||
Other cost of removal obligations
|
2,748
|
|
|
1,162
|
|
||
Other regulatory liabilities, deferred
|
258
|
|
|
254
|
|
||
Other deferred credits and liabilities
|
880
|
|
|
678
|
|
||
Total deferred credits and other liabilities
|
27,257
|
|
|
22,358
|
|
||
Total Liabilities
|
82,803
|
|
|
56,175
|
|
||
Redeemable Preferred Stock of Subsidiaries
(
See accompanying statements
)
|
118
|
|
|
118
|
|
||
Redeemable Noncontrolling Interests
(See accompanying statements)
|
164
|
|
|
43
|
|
||
Total Stockholders' Equity
(
See accompanying statements
)
|
26,612
|
|
|
21,982
|
|
||
Total Liabilities and Stockholders' Equity
|
$
|
109,697
|
|
|
$
|
78,318
|
|
Commitments and Contingent Matters
(
See notes
)
|
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
||
|
|
|
(in millions)
|
|
|
(percent of total)
|
|||||||||
Long-Term Debt:
|
|
|
|
|
|
|
|
|
|
||||||
Long-term debt payable to affiliated trusts —
|
|
|
|
|
|
|
|
|
|
||||||
Variable rate (3.95% at 1/1/17) due 2042
|
|
|
$
|
206
|
|
|
$
|
206
|
|
|
|
|
|
||
Long-term senior notes and debt —
|
|
|
|
|
|
|
|
|
|
||||||
Maturity
|
Interest Rates
|
|
|
|
|
|
|
|
|
||||||
2016
|
1.95% to 5.30%
|
|
—
|
|
|
1,360
|
|
|
|
|
|
||||
2017
|
1.30% to 7.20%
|
|
2,019
|
|
|
1,995
|
|
|
|
|
|
||||
2018
|
1.50% to 5.40%
|
|
2,353
|
|
|
1,697
|
|
|
|
|
|
||||
2019
|
1.85% to 5.55%
|
|
3,076
|
|
|
1,176
|
|
|
|
|
|
||||
2020
|
2.38% to 4.75%
|
|
1,326
|
|
|
1,327
|
|
|
|
|
|
||||
2021
|
2.35% to 9.10%
|
|
2,655
|
|
|
200
|
|
|
|
|
|
||||
2022 through 2051
|
1.00% to 8.70%
|
|
21,797
|
|
|
10,972
|
|
|
|
|
|
||||
Variable rates (0.76% to 3.50% at 1/1/16) due 2016
|
|
|
—
|
|
|
1,278
|
|
|
|
|
|
||||
Variable rates (1.82% to 3.75% at 1/1/17) due 2017
|
|
|
461
|
|
|
400
|
|
|
|
|
|
||||
Variable rates (1.88% to 2.24% at 1/1/17) due 2018
|
|
|
1,520
|
|
|
—
|
|
|
|
|
|
||||
Variable rates (1.87% to 2.10% at 1/1/17) due 2021
|
|
|
25
|
|
|
—
|
|
|
|
|
|
||||
Variable rate (3.75% at 1/1/17) due 2032 to 2036
|
|
|
15
|
|
|
13
|
|
|
|
|
|
||||
Total long-term senior notes and debt
|
|
|
35,247
|
|
|
20,418
|
|
|
|
|
|
||||
Other long-term debt —
|
|
|
|
|
|
|
|
|
|
||||||
Pollution control revenue bonds —
|
|
|
|
|
|
|
|
|
|
||||||
Maturity
|
Interest Rates
|
|
|
|
|
|
|
|
|
||||||
2019
|
4.55%
|
|
25
|
|
|
25
|
|
|
|
|
|
||||
2022 through 2049
|
0.65% to 5.15%
|
|
1,429
|
|
|
1,509
|
|
|
|
|
|
||||
Variable rate (0.22% at 1/1/16) due 2016
|
|
|
—
|
|
|
4
|
|
|
|
|
|
||||
Variable rates (0.77% to 0.87% at 1/1/17) due 2017
|
|
|
76
|
|
|
76
|
|
|
|
|
|
||||
Variable rates (0.82% to 0.86% at 1/1/17) due 2021
|
|
|
65
|
|
|
65
|
|
|
|
|
|
||||
Variable rates (0.75% to 0.87% at 1/1/17) due 2022 to 2053
|
|
|
1,739
|
|
|
1,659
|
|
|
|
|
|
||||
Plant Daniel revenue bonds (7.13%) due 2021
|
|
|
270
|
|
|
270
|
|
|
|
|
|
||||
FFB loans —
|
|
|
|
|
|
|
|
|
|
||||||
2.57% to 3.86% due 2020
|
|
|
44
|
|
|
37
|
|
|
|
|
|
||||
2.57% to 3.86% due 2021
|
|
|
44
|
|
|
37
|
|
|
|
|
|
||||
2.57% to 3.86% due 2022 to 2044
|
|
|
2,537
|
|
|
2,126
|
|
|
|
|
|
||||
First mortgage bonds —
|
|
|
|
|
|
|
|
|
|
||||||
4.70% due 2019
|
|
|
50
|
|
|
—
|
|
|
|
|
|
||||
2.66% to 6.58% due 2023 to 2038
|
|
|
575
|
|
|
—
|
|
|
|
|
|
||||
Gas facility revenue bonds —
|
|
|
|
|
|
|
|
|
|
||||||
Variable rate (1.28% at 1/1/17) due 2022 to 2033
|
|
|
200
|
|
|
—
|
|
|
|
|
|
||||
Junior subordinated notes (5.25% to 6.25%) due 2057 to 2076
|
|
|
2,350
|
|
|
1,000
|
|
|
|
|
|
||||
Total other long-term debt
|
|
|
9,404
|
|
|
6,808
|
|
|
|
|
|
||||
Unamortized fair value adjustment of long-term debt
|
|
|
578
|
|
|
—
|
|
|
|
|
|
||||
Capitalized lease obligations
|
|
|
136
|
|
|
146
|
|
|
|
|
|
||||
Unamortized debt premium
|
|
|
52
|
|
|
61
|
|
|
|
|
|
||||
Unamortized debt discount
|
|
|
(194
|
)
|
|
(36
|
)
|
|
|
|
|
||||
Unamortized debt issuance expense
|
|
|
(213
|
)
|
|
(241
|
)
|
|
|
|
|
||||
Total long-term debt (annual interest requirement — $1.6 billion)
|
|
45,216
|
|
|
27,362
|
|
|
|
|
|
|||||
Less amount due within one year
|
|
|
2,587
|
|
|
2,674
|
|
|
|
|
|
||||
Long-term debt excluding amount due within one year
|
|
|
42,629
|
|
|
24,688
|
|
|
61.3
|
%
|
|
52.6
|
%
|
||
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENTS OF CAPITALIZATION (continued)
At December 31, 2016 and 2015 Southern Company and Subsidiary Companies 2016 Annual Report |
|
|
|
|
|
|
|
|
|||||||
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
||
|
|
|
(in millions)
|
|
|
(percent of total)
|
|||||||||
Redeemable Preferred Stock of Subsidiaries:
|
|
|
|
|
|
|
|
|
|
||||||
Cumulative preferred stock
|
|
|
|
|
|
|
|
|
|
||||||
$100 par or stated value — 4.20% to 5.44%
|
|
|
|
|
|
|
|
|
|
||||||
Authorized — 20 million shares
|
|
|
|
|
|
|
|
|
|
||||||
Outstanding — 1 million shares
|
|
|
81
|
|
|
81
|
|
|
|
|
|
||||
$1 par value — 5.83%
|
|
|
|
|
|
|
|
|
|
||||||
Authorized — 28 million shares
|
|
|
|
|
|
|
|
|
|
||||||
Outstanding — 2 million shares: $25 stated value
|
|
|
37
|
|
|
37
|
|
|
|
|
|
||||
Total redeemable preferred stock of subsidiaries
(annual dividend requirement — $6 million) |
|
|
118
|
|
|
118
|
|
|
0.2
|
|
|
0.3
|
|
||
Redeemable Noncontrolling Interests
|
|
|
164
|
|
|
43
|
|
|
0.2
|
|
|
0.1
|
|
||
Common Stockholders' Equity:
|
|
|
|
|
|
|
|
|
|
||||||
Common stock, par value $5 per share —
|
|
|
4,952
|
|
|
4,572
|
|
|
|
|
|
||||
Authorized — 1.5 billion shares
|
|
|
|
|
|
|
|
|
|
||||||
Issued — 2016: 991 million shares
|
|
|
|
|
|
|
|
|
|
||||||
— 2015: 915 million shares
|
|
|
|
|
|
|
|
|
|
||||||
Treasury — 2016: 0.8 million shares
|
|
|
|
|
|
|
|
|
|
||||||
— 2015: 3.4 million shares
|
|
|
|
|
|
|
|
|
|
||||||
Paid-in capital
|
|
|
9,661
|
|
|
6,282
|
|
|
|
|
|
||||
Treasury, at cost
|
|
|
(31
|
)
|
|
(142
|
)
|
|
|
|
|
||||
Retained earnings
|
|
|
10,356
|
|
|
10,010
|
|
|
|
|
|
||||
Accumulated other comprehensive loss
|
|
|
(180
|
)
|
|
(130
|
)
|
|
|
|
|
||||
Total common stockholders' equity
|
|
|
24,758
|
|
|
20,592
|
|
|
35.6
|
|
|
44.0
|
|
||
Preferred and Preference Stock of Subsidiaries
and Noncontrolling Interests:
|
|
|
|
|
|
|
|
|
|
||||||
Non-cumulative preferred stock
|
|
|
|
|
|
|
|
|
|
||||||
$25 par value — 6.00% to 6.13%
|
|
|
|
|
|
|
|
|
|
||||||
Authorized — 60 million shares
|
|
|
|
|
|
|
|
|
|
||||||
Outstanding — 2 million shares
|
|
|
45
|
|
|
45
|
|
|
|
|
|
||||
Preference stock
|
|
|
|
|
|
|
|
|
|
||||||
Authorized — 65 million shares
|
|
|
|
|
|
|
|
|
|
||||||
Outstanding — $1 par value
|
|
|
196
|
|
|
196
|
|
|
|
|
|
||||
— 6.45% to 6.50% — 8 million shares (non-cumulative)
|
|
|
|
|
|
|
|
|
|
||||||
Outstanding — $100 par or stated value
|
|
|
368
|
|
|
368
|
|
|
|
|
|
||||
— 5.60% to 6.50% — 4 million shares (non-cumulative)
|
|
|
|
|
|
|
|
|
|
||||||
Noncontrolling interests
|
|
|
1,245
|
|
|
781
|
|
|
|
|
|
||||
Total preferred and preference stock of subsidiaries and noncontrolling
interests (annual dividend requirement — $39 million) |
|
|
1,854
|
|
|
1,390
|
|
|
2.7
|
|
|
3.0
|
|
||
Total stockholders' equity
|
|
|
26,612
|
|
|
21,982
|
|
|
|
|
|
||||
Total Capitalization
|
|
|
$
|
69,523
|
|
|
$
|
46,831
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Southern Company Common Stockholders' Equity
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Number of Common Shares
|
|
Common Stock
|
|
|
|
Accumulated
Other
Comprehensive Income
(Loss) |
|
Preferred
and Preference Stock of Subsidiaries
|
|
Noncontrolling
Interests
|
|
||||||||||||||||||||||||
|
Issued
|
|
Treasury
|
|
Par Value
|
|
Paid-In Capital
|
|
Treasury
|
|
Retained Earnings
|
|
|
|
Total
|
|||||||||||||||||||||
|
(in thousands)
|
|
(in millions)
|
|||||||||||||||||||||||||||||||||
Balance at December 31, 2013
|
892,733
|
|
|
(5,647
|
)
|
|
$
|
4,461
|
|
|
$
|
5,362
|
|
|
$
|
(250
|
)
|
|
$
|
9,510
|
|
|
$
|
(75
|
)
|
|
$
|
756
|
|
|
$
|
—
|
|
$
|
19,764
|
|
Consolidated net income attributable
to Southern Company
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,963
|
|
|
—
|
|
|
—
|
|
|
—
|
|
1,963
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(53
|
)
|
|
—
|
|
|
—
|
|
(53
|
)
|
||||||||
Stock issued
|
15,769
|
|
|
4,996
|
|
|
78
|
|
|
501
|
|
|
227
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
806
|
|
||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
86
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
86
|
|
||||||||
Cash dividends of $2.0825 per share
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,866
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
(1,866
|
)
|
||||||||
Contributions from
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
221
|
|
221
|
|
||||||||
Net loss attributable to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
(2
|
)
|
||||||||
Other
|
—
|
|
|
(74
|
)
|
|
—
|
|
|
6
|
|
|
(3
|
)
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
7
|
|
||||||||
Balance at December 31, 2014
|
908,502
|
|
|
(725
|
)
|
|
4,539
|
|
|
5,955
|
|
|
(26
|
)
|
|
9,609
|
|
|
(128
|
)
|
|
756
|
|
|
221
|
|
20,926
|
|
||||||||
Consolidated net income attributable
to Southern Company
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,367
|
|
|
—
|
|
|
—
|
|
|
—
|
|
2,367
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
(2
|
)
|
||||||||
Stock issued
|
6,571
|
|
|
(2,599
|
)
|
|
33
|
|
|
223
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
256
|
|
||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
100
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
100
|
|
||||||||
Stock repurchased, at cost
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(115
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(115
|
)
|
||||||||
Cash dividends of $2.1525 per share
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,959
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
(1,959
|
)
|
||||||||
Preference stock redemptions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(150
|
)
|
|
—
|
|
(150
|
)
|
||||||||
Contributions from
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
567
|
|
567
|
|
||||||||
Distributions to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
(18
|
)
|
||||||||
Net income attributable to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12
|
|
12
|
|
||||||||
Other
|
—
|
|
|
(28
|
)
|
|
—
|
|
|
4
|
|
|
(1
|
)
|
|
(7
|
)
|
|
—
|
|
|
3
|
|
|
(1
|
)
|
(2
|
)
|
||||||||
Balance at December 31, 2015
|
915,073
|
|
|
(3,352
|
)
|
|
4,572
|
|
|
6,282
|
|
|
(142
|
)
|
|
10,010
|
|
|
(130
|
)
|
|
609
|
|
|
781
|
|
21,982
|
|
||||||||
Consolidated net income attributable
to Southern Company
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,448
|
|
|
—
|
|
|
—
|
|
|
—
|
|
2,448
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(50
|
)
|
|
—
|
|
|
—
|
|
(50
|
)
|
||||||||
Stock issued
|
76,140
|
|
|
2,599
|
|
|
380
|
|
|
3,263
|
|
|
115
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
3,758
|
|
||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
120
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
120
|
|
||||||||
Cash dividends of $2.2225 per share
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,104
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
(2,104
|
)
|
||||||||
Contributions from
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
618
|
|
618
|
|
||||||||
Distributions to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(57
|
)
|
(57
|
)
|
||||||||
Purchase of membership interests
from noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(129
|
)
|
(129
|
)
|
||||||||
Net income attributable to redeemable
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32
|
|
32
|
|
||||||||
Other
|
—
|
|
|
(66
|
)
|
|
—
|
|
|
(4
|
)
|
|
(4
|
)
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(6
|
)
|
||||||||
Balance at December 31, 2016
|
991,213
|
|
|
(819
|
)
|
|
$
|
4,952
|
|
|
$
|
9,661
|
|
|
$
|
(31
|
)
|
|
$
|
10,356
|
|
|
$
|
(180
|
)
|
|
$
|
609
|
|
|
$
|
1,245
|
|
$
|
26,612
|
|
Note
|
|
Page
|
1
|
||
2
|
||
3
|
||
4
|
||
5
|
||
6
|
||
7
|
||
8
|
||
9
|
||
10
|
||
11
|
||
12
|
||
13
|
||
14
|
|
2016
|
|
2015
|
|
Note
|
||||
|
(in millions)
|
|
|
||||||
Retiree benefit plans
|
$
|
3,959
|
|
|
$
|
3,440
|
|
|
(a,n)
|
Deferred income tax charges
|
1,590
|
|
|
1,514
|
|
|
(b)
|
||
Asset retirement obligations-asset
|
1,080
|
|
|
481
|
|
|
(b,n)
|
||
Environmental remediation-asset
|
491
|
|
|
78
|
|
|
(j,n)
|
||
Other regulatory assets
|
355
|
|
|
299
|
|
|
(k)
|
||
Remaining net book value of retired assets
|
351
|
|
|
283
|
|
|
(o)
|
||
Under recovered regulatory clause revenues
|
273
|
|
|
142
|
|
|
(g)
|
||
Loss on reacquired debt
|
243
|
|
|
248
|
|
|
(c)
|
||
Property damage reserves-asset
|
206
|
|
|
92
|
|
|
(i)
|
||
Kemper IGCC
|
201
|
|
|
216
|
|
|
(h)
|
||
Vacation pay
|
182
|
|
|
178
|
|
|
(f,n)
|
||
Long-term debt fair value adjustment
|
155
|
|
|
—
|
|
|
(p)
|
||
Deferred PPA charges
|
141
|
|
|
163
|
|
|
(e,n)
|
||
Nuclear outage
|
97
|
|
|
88
|
|
|
(g)
|
||
Fuel-hedging-asset
|
35
|
|
|
225
|
|
|
(d,n)
|
||
Other cost of removal obligations
|
(2,774
|
)
|
|
(1,177
|
)
|
|
(b)
|
||
Deferred income tax credits
|
(219
|
)
|
|
(187
|
)
|
|
(b)
|
||
Over recovered regulatory clause revenues
|
(203
|
)
|
|
(261
|
)
|
|
(g)
|
||
Property damage reserves-liability
|
(177
|
)
|
|
(178
|
)
|
|
(l)
|
||
Other regulatory liabilities
|
(110
|
)
|
|
(35
|
)
|
|
(m)
|
||
Asset retirement obligations-liability
|
(10
|
)
|
|
(45
|
)
|
|
(b,n)
|
||
Total regulatory assets (liabilities), net
|
$
|
5,866
|
|
|
$
|
5,564
|
|
|
|
(a)
|
Recovered and amortized over the average remaining service period which may range up to
15 years
. See Note 2 for additional information.
|
(b)
|
Asset retirement and other cost of removal obligations are recorded, deferred income tax assets are recovered, and deferred income tax liabilities are amortized over the related property lives, which may range up to
70 years
. Asset retirement and removal liabilities will be settled and trued up following completion of the related activities.
|
(c)
|
Recovered over either the remaining life of the original issue or, if refinanced, over the remaining life of the new issue, which may range up to
50 years
.
|
(d)
|
Recorded over the life of the underlying hedged purchase contracts, which generally do not exceed
five years
. Upon final settlement, actual costs incurred are recovered through fuel and energy cost recovery mechanisms.
|
(e)
|
Recovered over the life of the PPA for periods up to
seven years
.
|
(f)
|
Recorded as earned by employees and recovered as paid, generally within
one year
. This includes both vacation and banked holiday pay.
|
(g)
|
Recorded and recovered or amortized as approved or accepted by the appropriate state PSCs or other applicable regulatory agencies over periods generally not exceeding
ten years
.
|
(h)
|
Includes
$97 million
of regulatory assets currently in rates to be recovered over periods of
two
,
seven
, or
10 years
. For additional information, see Note 3 under "
Integrated Coal Gasification Combined Cycle
–
Rate Recovery of Kemper IGCC Costs
–
Regulatory Assets and Liabilities
."
|
(i)
|
Previous under-recovery as of December 2013 is recorded and recovered or amortized as approved by the Georgia PSC through 2019. Amortization of
$185 million
related to the under-recovery from January 2014 through December 2016 will be determined by the Georgia PSC in the 2019 base rate case. See Note 3 for additional information.
|
(j)
|
Recovered through environmental cost recovery mechanisms when the remediation is performed or the work is performed.
|
(k)
|
Comprised of numerous immaterial components including deferred income tax charges - Medicare subsidy, cancelled construction projects, building and generating plant leases, property tax, and other miscellaneous assets. These costs are recorded and recovered or amortized as approved by the appropriate state PSCs over periods generally not exceeding
50 years
.
|
(l)
|
Recovered as storm restoration and potential reliability-related expenses are incurred as approved by the appropriate state PSCs.
|
(m)
|
Comprised of numerous immaterial components including retiree benefit plans, fuel-hedging gains, and other liabilities that are recorded and recovered or amortized as approved by the appropriate state PSCs or other applicable regulatory agencies generally over periods not exceeding
4 years
.
|
(n)
|
Not earning a return as offset in rate base by a corresponding asset or liability.
|
(o)
|
Amortized as approved by the appropriate state PSCs over periods generally up to
11 years
.
|
(p)
|
Recorded in relation to the Merger. Recovered over the remaining life of the original debt issuances, which range up to
22 years
. For additional information see Note 12 under "
Southern Company
–
Merger with Southern Company Gas
."
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Electric utilities:
|
|
|
|
||||
Generation
|
$
|
48,836
|
|
|
$
|
41,648
|
|
Transmission
|
11,156
|
|
|
10,544
|
|
||
Distribution
|
18,418
|
|
|
17,670
|
|
||
General
|
4,629
|
|
|
4,377
|
|
||
Plant acquisition adjustment
|
126
|
|
|
123
|
|
||
Electric utility plant in service
|
83,165
|
|
|
74,362
|
|
||
Natural gas distribution utilities:
|
|
|
|
||||
Transportation and distribution
|
11,996
|
|
|
—
|
|
||
Utility plant in service
|
95,161
|
|
|
74,362
|
|
||
Information technology equipment and software
|
544
|
|
|
222
|
|
||
Communications equipment
|
424
|
|
|
418
|
|
||
Storage facilities
|
1,463
|
|
|
—
|
|
||
Other
|
824
|
|
|
116
|
|
||
Total other plant in service
|
3,255
|
|
|
756
|
|
||
Total plant in service
|
$
|
98,416
|
|
|
$
|
75,118
|
|
|
Asset Balances at
December 31,
|
||||||
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Office building
|
$
|
61
|
|
|
$
|
61
|
|
Nitrogen plant
|
83
|
|
|
83
|
|
||
Computer-related equipment
|
63
|
|
|
61
|
|
||
Gas pipeline
|
6
|
|
|
6
|
|
||
Less: Accumulated amortization
|
(69
|
)
|
|
(59
|
)
|
||
Balance, net of amortization
|
$
|
144
|
|
|
$
|
152
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Balance at beginning of year
|
$
|
3,759
|
|
|
$
|
2,201
|
|
Liabilities incurred
|
66
|
|
|
662
|
|
||
Liabilities settled
|
(171
|
)
|
|
(37
|
)
|
||
Accretion
|
162
|
|
|
115
|
|
||
Cash flow revisions
|
698
|
|
|
818
|
|
||
Balance at end of year
|
$
|
4,514
|
|
|
$
|
3,759
|
|
|
External Trust Funds
|
||||||
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Plant Farley
|
$
|
790
|
|
|
$
|
734
|
|
Plant Hatch
|
511
|
|
|
487
|
|
||
Plant Vogtle Units 1 and 2
|
303
|
|
|
288
|
|
|
Plant Farley
|
|
Plant Hatch
|
|
Plant Vogtle
Units 1 and 2
|
||||||
Decommissioning periods:
|
|
|
|
|
|
||||||
Beginning year
|
2037
|
|
|
2034
|
|
|
2047
|
|
|||
Completion year
|
2076
|
|
|
2075
|
|
|
2079
|
|
|||
|
(in millions)
|
||||||||||
Site study costs:
|
|
|
|
|
|
||||||
Radiated structures
|
$
|
1,362
|
|
|
$
|
678
|
|
|
$
|
568
|
|
Spent fuel management
|
—
|
|
|
160
|
|
|
147
|
|
|||
Non-radiated structures
|
80
|
|
|
64
|
|
|
89
|
|
|||
Total site study costs
|
$
|
1,442
|
|
|
$
|
902
|
|
|
$
|
804
|
|
|
Estimated Useful Life
|
Gross Carrying Amount
|
Accumulated Amortization
|
Other
Intangible Assets, Net |
||||||
|
|
(in millions)
|
||||||||
Other intangible assets subject to amortization:
|
|
|
|
|
||||||
Customer relationships
|
11-26 years
|
$
|
268
|
|
$
|
(32
|
)
|
$
|
236
|
|
Trade names
|
5-28 years
|
158
|
|
(5
|
)
|
153
|
|
|||
Patents
|
3-10 years
|
4
|
|
—
|
|
4
|
|
|||
Backlog
|
5 years
|
5
|
|
(1
|
)
|
4
|
|
|||
Storage and transportation contracts
|
1-5 years
|
64
|
|
(2
|
)
|
62
|
|
|||
Software and other
|
1-12 years
|
2
|
|
—
|
|
2
|
|
|||
PPA fair value adjustments
|
19-20 years
|
456
|
|
(22
|
)
|
434
|
|
|||
Total other intangible assets subject to amortization
|
|
$
|
957
|
|
$
|
(62
|
)
|
$
|
895
|
|
Other intangible assets not subject to amortization:
|
|
|
|
|
||||||
Federal Communications Commission licenses
|
|
75
|
|
—
|
|
75
|
|
|||
Total other intangible assets
|
|
$
|
1,032
|
|
$
|
(62
|
)
|
$
|
970
|
|
|
Amortization
|
||
|
(in millions)
|
||
2017
|
$
|
108
|
|
2018
|
93
|
|
|
2019
|
74
|
|
|
2020
|
63
|
|
|
2021
|
56
|
|
|
Amortization
|
||
|
(in millions)
|
||
2017
|
$
|
29
|
|
2018
|
24
|
|
|
2019
|
17
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Net rentals receivable
|
$
|
1,481
|
|
|
$
|
1,487
|
|
Unearned income
|
(707
|
)
|
|
(732
|
)
|
||
Investment in leveraged leases
|
774
|
|
|
755
|
|
||
Deferred taxes from leveraged leases
|
(309
|
)
|
|
(303
|
)
|
||
Net investment in leveraged leases
|
$
|
465
|
|
|
$
|
452
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Pretax leveraged lease income
|
$
|
25
|
|
|
$
|
20
|
|
|
$
|
24
|
|
Income tax expense
|
(9
|
)
|
|
(7
|
)
|
|
(9
|
)
|
|||
Net leveraged lease income
|
$
|
16
|
|
|
$
|
13
|
|
|
$
|
15
|
|
|
Qualifying
Hedges
|
|
Marketable
Securities
|
|
Pension and Other
Postretirement
Benefit Plans
|
|
Accumulated Other
Comprehensive
Income (Loss)
|
||||||||
|
(in millions)
|
||||||||||||||
Balance at December 31, 2015
|
$
|
(48
|
)
|
|
$
|
—
|
|
|
$
|
(82
|
)
|
|
$
|
(130
|
)
|
Current period change
|
(67
|
)
|
|
—
|
|
|
17
|
|
|
(50
|
)
|
||||
Balance at December 31, 2016
|
$
|
(115
|
)
|
|
$
|
—
|
|
|
$
|
(65
|
)
|
|
$
|
(180
|
)
|
Assumptions used to determine net periodic costs:
|
2016
|
|
2015
|
|
2014
|
|||
Pension plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.58
|
%
|
|
4.17
|
%
|
|
5.02
|
%
|
Discount rate – interest costs
|
3.88
|
|
|
4.17
|
|
|
5.02
|
|
Discount rate – service costs
|
4.98
|
|
|
4.48
|
|
|
5.02
|
|
Expected long-term return on plan assets
|
8.16
|
|
|
8.20
|
|
|
8.20
|
|
Annual salary increase
|
4.37
|
|
|
3.59
|
|
|
3.59
|
|
Other postretirement benefit plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.38
|
%
|
|
4.04
|
%
|
|
4.85
|
%
|
Discount rate – interest costs
|
3.66
|
|
|
4.04
|
|
|
4.85
|
|
Discount rate – service costs
|
4.85
|
|
|
4.39
|
|
|
4.85
|
|
Expected long-term return on plan assets
|
6.66
|
|
|
6.97
|
|
|
7.15
|
|
Annual salary increase
|
4.37
|
|
|
3.59
|
|
|
3.59
|
|
Assumptions used to determine benefit obligations:
|
2016
|
|
2015
|
||
Pension plans
|
|
|
|
||
Discount rate
|
4.40
|
%
|
|
4.67
|
%
|
Annual salary increase
|
4.37
|
|
|
4.46
|
|
Other postretirement benefit plans
|
|
|
|
||
Discount rate
|
4.23
|
%
|
|
4.51
|
%
|
Annual salary increase
|
4.37
|
|
|
4.46
|
|
|
Initial Cost Trend Rate
|
|
Ultimate Cost Trend Rate
|
|
Year That Ultimate Rate is Reached
|
||
Pre-65
|
6.50
|
%
|
|
4.50
|
%
|
|
2025
|
Post-65 medical
|
5.00
|
|
|
4.50
|
|
|
2025
|
Post-65 prescription
|
10.00
|
|
|
4.50
|
|
|
2025
|
|
1 Percent
Increase |
|
1 Percent
Decrease |
||||
|
(in millions)
|
||||||
Benefit obligation
|
$
|
128
|
|
|
$
|
110
|
|
Service and interest costs
|
4
|
|
|
3
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
10,542
|
|
|
$
|
10,909
|
|
Acquisitions
|
1,244
|
|
|
—
|
|
||
Service cost
|
262
|
|
|
257
|
|
||
Interest cost
|
422
|
|
|
445
|
|
||
Benefits paid
|
(466
|
)
|
|
(487
|
)
|
||
Actuarial (gain) loss
|
381
|
|
|
(582
|
)
|
||
Balance at end of year
|
12,385
|
|
|
10,542
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
9,234
|
|
|
9,690
|
|
||
Acquisitions
|
837
|
|
|
—
|
|
||
Actual return (loss) on plan assets
|
902
|
|
|
(14
|
)
|
||
Employer contributions
|
1,076
|
|
|
45
|
|
||
Benefits paid
|
(466
|
)
|
|
(487
|
)
|
||
Fair value of plan assets at end of year
|
11,583
|
|
|
9,234
|
|
||
Accrued liability
|
$
|
(802
|
)
|
|
$
|
(1,308
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
3,207
|
|
|
$
|
2,998
|
|
Other current liabilities
|
(53
|
)
|
|
(46
|
)
|
||
Employee benefit obligations
|
(749
|
)
|
|
(1,262
|
)
|
||
Other regulatory liabilities, deferred
|
(87
|
)
|
|
—
|
|
||
Accumulated OCI
|
100
|
|
|
125
|
|
|
Prior
Service
Cost
|
|
Net (Gain) Loss
|
||||
|
(in millions)
|
||||||
Balance at December 31, 2016:
|
|
|
|
||||
Accumulated OCI
|
$
|
4
|
|
|
$
|
96
|
|
Regulatory assets
|
51
|
|
|
3,069
|
|
||
Total
|
$
|
55
|
|
|
$
|
3,165
|
|
Balance at December 31, 2015:
|
|
|
|
||||
Accumulated OCI
|
$
|
3
|
|
|
$
|
122
|
|
Regulatory assets
|
27
|
|
|
2,971
|
|
||
Total
|
$
|
30
|
|
|
$
|
3,093
|
|
Estimated amortization in net periodic pension cost in 2017:
|
|
|
|
||||
Accumulated OCI
|
$
|
1
|
|
|
$
|
7
|
|
Regulatory assets
|
11
|
|
|
155
|
|
||
Total
|
$
|
12
|
|
|
$
|
162
|
|
|
Accumulated
OCI
|
|
Regulatory Assets
|
||||
|
(in millions)
|
||||||
Balance at December 31, 2014
|
$
|
134
|
|
|
$
|
3,073
|
|
Net (gain) loss
|
1
|
|
|
155
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
(1
|
)
|
|
(24
|
)
|
||
Amortization of net gain (loss)
|
(9
|
)
|
|
(206
|
)
|
||
Total reclassification adjustments
|
(10
|
)
|
|
(230
|
)
|
||
Total change
|
(9
|
)
|
|
(75
|
)
|
||
Balance at December 31, 2015
|
$
|
125
|
|
|
$
|
2,998
|
|
Net (gain) loss
|
(20
|
)
|
|
243
|
|
||
Change in prior service costs
|
2
|
|
|
37
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
(1
|
)
|
|
(13
|
)
|
||
Amortization of net gain (loss)
|
(6
|
)
|
|
(145
|
)
|
||
Total reclassification adjustments
|
(7
|
)
|
|
(158
|
)
|
||
Total change
|
(25
|
)
|
|
122
|
|
||
Balance at December 31, 2016
|
$
|
100
|
|
|
$
|
3,120
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
262
|
|
|
$
|
257
|
|
|
$
|
213
|
|
Interest cost
|
422
|
|
|
445
|
|
|
435
|
|
|||
Expected return on plan assets
|
(782
|
)
|
|
(724
|
)
|
|
(645
|
)
|
|||
Recognized net (gain) loss
|
150
|
|
|
215
|
|
|
110
|
|
|||
Net amortization
|
14
|
|
|
25
|
|
|
26
|
|
|||
Net periodic pension cost
|
$
|
66
|
|
|
$
|
218
|
|
|
$
|
139
|
|
|
Benefit
Payments
|
||
|
(in millions)
|
||
2017
|
$
|
571
|
|
2018
|
593
|
|
|
2019
|
620
|
|
|
2020
|
646
|
|
|
2021
|
666
|
|
|
2022 to 2026
|
3,673
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
1,989
|
|
|
$
|
1,986
|
|
Acquisitions
|
338
|
|
|
—
|
|
||
Service cost
|
22
|
|
|
23
|
|
||
Interest cost
|
76
|
|
|
78
|
|
||
Benefits paid
|
(119
|
)
|
|
(102
|
)
|
||
Actuarial (gain) loss
|
(16
|
)
|
|
(38
|
)
|
||
Plan amendments
|
—
|
|
|
34
|
|
||
Retiree drug subsidy
|
7
|
|
|
8
|
|
||
Balance at end of year
|
2,297
|
|
|
1,989
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
833
|
|
|
900
|
|
||
Acquisitions
|
100
|
|
|
—
|
|
||
Actual return (loss) on plan assets
|
58
|
|
|
(12
|
)
|
||
Employer contributions
|
65
|
|
|
39
|
|
||
Benefits paid
|
(112
|
)
|
|
(94
|
)
|
||
Fair value of plan assets at end of year
|
944
|
|
|
833
|
|
||
Accrued liability
|
$
|
(1,353
|
)
|
|
$
|
(1,156
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
419
|
|
|
$
|
433
|
|
Other current liabilities
|
(4
|
)
|
|
(4
|
)
|
||
Employee benefit obligations
|
(1,349
|
)
|
|
(1,152
|
)
|
||
Other regulatory liabilities, deferred
|
(41
|
)
|
|
(22
|
)
|
||
Accumulated OCI
|
7
|
|
|
8
|
|
|
Prior
Service
Cost
|
|
Net (Gain)
Loss
|
||||
|
(in millions)
|
||||||
Balance at December 31, 2016:
|
|
|
|
||||
Accumulated OCI
|
$
|
—
|
|
|
$
|
7
|
|
Net regulatory assets
|
25
|
|
|
353
|
|
||
Total
|
$
|
25
|
|
|
$
|
360
|
|
Balance at December 31, 2015:
|
|
|
|
||||
Accumulated OCI
|
$
|
—
|
|
|
$
|
8
|
|
Net regulatory assets
|
32
|
|
|
379
|
|
||
Total
|
$
|
32
|
|
|
$
|
387
|
|
Estimated amortization as net periodic postretirement benefit cost in 2017:
|
|
|
|
||||
Net regulatory assets
|
$
|
6
|
|
|
$
|
13
|
|
|
Accumulated
OCI
|
|
Net Regulatory
Assets
(Liabilities)
|
||||
|
(in millions)
|
||||||
Balance at December 31, 2014
|
$
|
8
|
|
|
$
|
366
|
|
Net (gain) loss
|
—
|
|
|
33
|
|
||
Change in prior service costs
|
—
|
|
|
33
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
—
|
|
|
(4
|
)
|
||
Amortization of net gain (loss)
|
—
|
|
|
(17
|
)
|
||
Total reclassification adjustments
|
—
|
|
|
(21
|
)
|
||
Total change
|
—
|
|
|
45
|
|
||
Balance at December 31, 2015
|
$
|
8
|
|
|
$
|
411
|
|
Net (gain) loss
|
(1
|
)
|
|
(13
|
)
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
—
|
|
|
(6
|
)
|
||
Amortization of net gain (loss)
|
—
|
|
|
(14
|
)
|
||
Total reclassification adjustments
|
—
|
|
|
(20
|
)
|
||
Total change
|
(1
|
)
|
|
(33
|
)
|
||
Balance at December 31, 2016
|
$
|
7
|
|
|
$
|
378
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
22
|
|
|
$
|
23
|
|
|
$
|
21
|
|
Interest cost
|
76
|
|
|
78
|
|
|
79
|
|
|||
Expected return on plan assets
|
(60
|
)
|
|
(58
|
)
|
|
(59
|
)
|
|||
Net amortization
|
21
|
|
|
21
|
|
|
6
|
|
|||
Net periodic postretirement benefit cost
|
$
|
59
|
|
|
$
|
64
|
|
|
$
|
47
|
|
|
Benefit
Payments
|
|
Subsidy
Receipts
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
2017
|
$
|
145
|
|
|
$
|
(10
|
)
|
|
$
|
135
|
|
2018
|
150
|
|
|
(11
|
)
|
|
139
|
|
|||
2019
|
155
|
|
|
(12
|
)
|
|
143
|
|
|||
2020
|
159
|
|
|
(13
|
)
|
|
146
|
|
|||
2021
|
162
|
|
|
(14
|
)
|
|
148
|
|
|||
2022 to 2026
|
823
|
|
|
(73
|
)
|
|
750
|
|
Description
|
Valuation Methodology
|
●
Domestic equity:
A mix of large and small capitalization stocks with generally an equal distribution of value and growth attributes, managed both actively and through passive index approaches.
●
International equity:
A mix of growth stocks and value stocks with both developed and emerging market exposure, managed both actively and through passive index approaches.
|
Domestic and International equities such as common stocks, American depositary receipts, and real estate investment trusts that trade on public exchanges are classified as Level 1 investments and are valued at the closing price in the active market. Equity funds with unpublished prices are valued as Level 2 when the underlying holdings are comprised of Level 1 or Level 2 equity securities.
|
●
Fixed income:
A mix of domestic and international bonds.
|
Investments in fixed income securities are generally classified as Level 2 investments and are valued based on prices reported in the market place. Additionally, the value of fixed income securities takes into consideration certain items such as broker quotes, spreads, yield curves, interest rates, and discount rates that apply to the term of a specific instrument.
|
●
Trust-owned life insurance (TOLI):
Investments of the Company's taxable trusts aimed at minimizing the impact of taxes on the portfolio.
|
Investments in TOLI policies are classified as Level 2 investments and are valued based on the underlying investments held in the policy's separate accounts. The underlying assets are equity and fixed income pooled funds that are comprised of Level 1 and Level 2 securities.
|
●
Special situations:
Investments in opportunistic strategies with the objective of diversifying and enhancing returns and exploiting short-term inefficiencies, as well as investments in promising new strategies of a longer-term nature.
●
Real estate:
Investments in traditional private market, equity-oriented investments in real properties (indirectly through pooled funds or partnerships) and in publicly traded real estate securities.
●
Private equity:
Investments in private partnerships that invest in private or public securities typically through privately-negotiated and/or structured transactions, including leveraged buyouts, venture capital, and distressed debt.
|
Investments in real estate, private equity, and special situations are generally classified as Net Asset Value as a Practical Expedient, since the underlying assets typically do not have publicly available observable inputs. The fund manager values the assets using various inputs and techniques depending on the nature of the underlying investments. Techniques may include purchase multiples for comparable transactions, comparable public company trading multiples, discounted cash flow analysis, prevailing market capitalization rates, recent sales of comparable investments, and independent third-party appraisals. The fair value of partnerships is determined by aggregating the value of the underlying assets less liabilities.
|
|
Fair Value Measurements Using
|
|
|
|
|||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
Significant
Other
Observable
Inputs
|
Significant
Unobservable
Inputs
|
Net Asset Value as a Practical Expedient
|
|
Target Allocation
|
Actual Allocation
|
||||||||||||
As of December 31, 2016:
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
(NAV)
|
Total
|
||||||||||||||
|
(in millions)
|
|
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||||||
Domestic equity
(*)
|
$
|
2,010
|
|
$
|
927
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,937
|
|
26
|
%
|
29
|
%
|
International equity
(*)
|
1,231
|
|
1,110
|
|
—
|
|
—
|
|
2,341
|
|
25
|
|
22
|
|
|||||
Fixed income:
|
|
|
|
|
|
23
|
|
29
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
588
|
|
—
|
|
—
|
|
588
|
|
|
|
|||||||
Mortgage- and asset-backed securities
|
—
|
|
13
|
|
—
|
|
—
|
|
13
|
|
|
|
|||||||
Corporate bonds
|
—
|
|
991
|
|
—
|
|
—
|
|
991
|
|
|
|
|||||||
Pooled funds
|
—
|
|
524
|
|
—
|
|
—
|
|
524
|
|
|
|
|||||||
Cash equivalents and other
|
996
|
|
2
|
|
—
|
|
—
|
|
998
|
|
|
|
|||||||
Real estate investments
|
310
|
|
—
|
|
—
|
|
1,152
|
|
1,462
|
|
14
|
|
13
|
|
|||||
Special situations
|
—
|
|
—
|
|
|
|
180
|
|
180
|
|
3
|
|
2
|
|
|||||
Private equity
|
—
|
|
—
|
|
—
|
|
549
|
|
549
|
|
9
|
|
5
|
|
|||||
Total
|
$
|
4,547
|
|
$
|
4,155
|
|
$
|
—
|
|
$
|
1,881
|
|
$
|
10,583
|
|
100
|
%
|
100
|
%
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
|
|||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
Significant
Other
Observable
Inputs
|
Significant
Unobservable
Inputs
|
Net Asset Value as a Practical Expedient
|
|
Target Allocation
|
Actual Allocation
|
||||||||||||
As of December 31, 2015:
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
(NAV)
|
Total
|
||||||||||||||
|
(in millions)
|
|
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||||||
Domestic equity
(a)
|
$
|
1,632
|
|
$
|
681
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,313
|
|
26
|
%
|
30
|
%
|
International equity
(a)
|
1,190
|
|
962
|
|
—
|
|
—
|
|
2,152
|
|
25
|
|
23
|
|
|||||
Fixed income:
|
|
|
|
|
|
23
|
|
23
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
454
|
|
—
|
|
—
|
|
454
|
|
|
|
|||||||
Mortgage- and asset-backed securities
|
—
|
|
199
|
|
—
|
|
—
|
|
199
|
|
|
|
|||||||
Corporate bonds
|
—
|
|
1,140
|
|
—
|
|
—
|
|
1,140
|
|
|
|
|||||||
Pooled funds
|
—
|
|
500
|
|
—
|
|
—
|
|
500
|
|
|
|
|||||||
Cash equivalents and other
|
—
|
|
145
|
|
—
|
|
—
|
|
145
|
|
|
|
|||||||
Real estate investments
|
299
|
|
—
|
|
—
|
|
1,185
|
|
1,484
|
|
14
|
|
16
|
|
|||||
Special situations
(b)
|
—
|
|
—
|
|
—
|
|
160
|
|
160
|
|
3
|
|
2
|
|
|||||
Private equity
|
—
|
|
—
|
|
—
|
|
536
|
|
536
|
|
9
|
|
6
|
|
|||||
Total
|
$
|
3,121
|
|
$
|
4,081
|
|
$
|
—
|
|
$
|
1,881
|
|
$
|
9,083
|
|
100
|
%
|
100
|
%
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||||||
Derivatives
|
$
|
(1
|
)
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
(1
|
)
|
|
|
||
Total
|
$
|
3,120
|
|
$
|
4,081
|
|
$
|
—
|
|
$
|
1,881
|
|
$
|
9,082
|
|
100
|
%
|
100
|
%
|
(a)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
(b)
|
The 2015 presentation above has been revised to separately reflect special situations, consistent with the 2016 presentation.
|
|
Fair Value Measurements Using
|
|
|||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
Significant
Other Observable Inputs |
Significant
Unobservable Inputs |
Net Asset Value as a Practical Expedient
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
(NAV)
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
142
|
|
$
|
343
|
|
$
|
—
|
|
$
|
—
|
|
$
|
485
|
|
International equity
(*)
|
—
|
|
185
|
|
—
|
|
—
|
|
185
|
|
|||||
Fixed income:
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
85
|
|
—
|
|
—
|
|
85
|
|
|||||
Corporate bonds
|
—
|
|
41
|
|
—
|
|
—
|
|
41
|
|
|||||
Pooled funds
|
—
|
|
66
|
|
—
|
|
—
|
|
66
|
|
|||||
Cash equivalents and other
|
12
|
|
5
|
|
—
|
|
83
|
|
100
|
|
|||||
Real estate investments
|
4
|
|
—
|
|
—
|
|
15
|
|
19
|
|
|||||
Private equity
|
—
|
|
—
|
|
—
|
|
2
|
|
2
|
|
|||||
Total
|
$
|
158
|
|
$
|
725
|
|
$
|
—
|
|
$
|
100
|
|
$
|
983
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
|
|||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
Significant
Other
Observable
Inputs
|
Significant
Unobservable
Inputs
|
Net Asset Value as a Practical Expedient
|
Total
|
Target Allocation
|
Actual Allocation
|
||||||||||||
As of December 31, 2016:
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
(NAV)
|
|||||||||||||||
|
(in millions)
|
|
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||||||
Domestic equity
(*)
|
$
|
118
|
|
$
|
28
|
|
$
|
—
|
|
$
|
—
|
|
$
|
146
|
|
39
|
%
|
40
|
%
|
International equity
(*)
|
37
|
|
61
|
|
—
|
|
—
|
|
98
|
|
23
|
|
21
|
|
|||||
Fixed income:
|
|
|
|
|
|
29
|
|
31
|
|
||||||||||
U.S. Treasury, government,
and agency bonds
|
—
|
|
24
|
|
—
|
|
—
|
|
24
|
|
|
|
|||||||
Corporate bonds
|
—
|
|
30
|
|
—
|
|
—
|
|
30
|
|
|
|
|||||||
Pooled funds
|
—
|
|
49
|
|
—
|
|
—
|
|
49
|
|
|
|
|||||||
Cash equivalents and other
|
41
|
|
—
|
|
—
|
|
—
|
|
41
|
|
|
|
|||||||
Trust-owned life insurance
|
—
|
|
382
|
|
—
|
|
—
|
|
382
|
|
|
|
|||||||
Real estate investments
|
11
|
|
—
|
|
—
|
|
35
|
|
46
|
|
5
|
|
5
|
|
|||||
Special situations
|
—
|
|
—
|
|
—
|
|
5
|
|
5
|
|
1
|
|
1
|
|
|||||
Private equity
|
—
|
|
—
|
|
—
|
|
17
|
|
17
|
|
3
|
|
2
|
|
|||||
Total
|
$
|
207
|
|
$
|
574
|
|
$
|
—
|
|
$
|
57
|
|
$
|
838
|
|
100
|
%
|
100
|
%
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
|
|||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
Significant
Other
Observable
Inputs
|
Significant
Unobservable
Inputs
|
Net Asset Value as a Practical Expedient
|
|
Target Allocation
|
Actual Allocation
|
||||||||||||
As of December 31, 2015:
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
(NAV)
|
Total
|
||||||||||||||
|
(in millions)
|
|
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||||||
Domestic equity
(a)
|
$
|
106
|
|
$
|
52
|
|
$
|
—
|
|
$
|
—
|
|
$
|
158
|
|
42
|
%
|
38
|
%
|
International equity
(a)
|
40
|
|
63
|
|
—
|
|
—
|
|
103
|
|
21
|
|
23
|
|
|||||
Fixed income:
|
|
|
|
|
|
28
|
|
30
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
22
|
|
—
|
|
—
|
|
22
|
|
|
|
|||||||
Mortgage- and asset-backed securities
|
—
|
|
7
|
|
—
|
|
—
|
|
7
|
|
|
|
|||||||
Corporate bonds
|
—
|
|
38
|
|
—
|
|
—
|
|
38
|
|
|
|
|||||||
Pooled funds
|
—
|
|
42
|
|
—
|
|
—
|
|
42
|
|
|
|
|||||||
Cash equivalents and other
|
11
|
|
9
|
|
—
|
|
—
|
|
20
|
|
|
|
|||||||
Trust-owned life insurance
|
—
|
|
370
|
|
—
|
|
—
|
|
370
|
|
|
|
|||||||
Real estate investments
|
11
|
|
—
|
|
—
|
|
40
|
|
51
|
|
5
|
|
6
|
|
|||||
Special situations
(b)
|
—
|
|
—
|
|
—
|
|
5
|
|
5
|
|
1
|
|
1
|
|
|||||
Private equity
|
—
|
|
—
|
|
—
|
|
18
|
|
18
|
|
3
|
|
2
|
|
|||||
Total
|
$
|
168
|
|
$
|
603
|
|
$
|
—
|
|
$
|
63
|
|
$
|
834
|
|
100
|
%
|
100
|
%
|
(a)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
(b)
|
The 2015 presentation above has been revised to separately reflect special situations, consistent with the 2016 presentation.
|
|
Fair Value Measurements Using
|
|
|||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
Significant
Other Observable Inputs |
Significant
Unobservable Inputs |
Net Asset Value as a Practical Expedient
|
Total
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
(NAV)
|
|||||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
3
|
|
$
|
58
|
|
$
|
—
|
|
$
|
—
|
|
$
|
61
|
|
International equity
(*)
|
—
|
|
18
|
|
—
|
|
—
|
|
18
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|||||||||
Pooled funds
|
—
|
|
23
|
|
—
|
|
—
|
|
23
|
|
|||||
Cash equivalents and other
|
1
|
|
—
|
|
—
|
|
2
|
|
3
|
|
|||||
Total
|
$
|
4
|
|
$
|
99
|
|
$
|
—
|
|
$
|
2
|
|
$
|
105
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
Cost Category
|
2010
Project Estimate
(a)
|
|
Current Cost Estimate
(b)
|
|
Actual Costs
|
||||||
|
(in billions)
|
||||||||||
Plant Subject to Cost Cap
(c)(e)
|
$
|
2.40
|
|
|
$
|
5.64
|
|
|
$
|
5.44
|
|
Lignite Mine and Equipment
|
0.21
|
|
|
0.23
|
|
|
0.23
|
|
|||
CO
2
Pipeline Facilities
|
0.14
|
|
|
0.11
|
|
|
0.11
|
|
|||
AFUDC
(d)
|
0.17
|
|
|
0.79
|
|
|
0.75
|
|
|||
Combined Cycle and Related Assets Placed in
Service – Incremental
(e)
|
—
|
|
|
0.04
|
|
|
0.04
|
|
|||
General Exceptions
|
0.05
|
|
|
0.10
|
|
|
0.09
|
|
|||
Deferred Costs
(e)
|
—
|
|
|
0.22
|
|
|
0.21
|
|
|||
Additional DOE Grants
(f)
|
—
|
|
|
(0.14
|
)
|
|
(0.14
|
)
|
|||
Total Kemper IGCC
(g)
|
$
|
2.97
|
|
|
$
|
6.99
|
|
|
$
|
6.73
|
|
(a)
|
The 2010 Project Estimate is the certificated cost estimate adjusted to include the certificated estimate for the CO
2
pipeline facilities approved in 2011 by the Mississippi PSC, as well as the lignite mine and equipment, AFUDC, and general exceptions.
|
(b)
|
Amounts in the Current Cost Estimate include certain estimated post-in-service costs which are expected to be subject to the cost cap.
|
(c)
|
The 2012 MPSC CPCN Order approved a construction cost cap of up to
$2.88 billion
, net of the Initial DOE Grants and excluding the cost of the lignite mine and equipment, the cost of the CO
2
pipeline facilities, AFUDC, and certain general exceptions, including change of law, force majeure, and beneficial capital (which exists when Mississippi Power demonstrates that the purpose and effect of the construction cost increase is to produce efficiencies that will result in a neutral or favorable effect on customers relative to the original proposal for the CPCN) (Cost Cap Exceptions). The Current Cost Estimate and the Actual Costs include non-incremental operating and maintenance costs related to the combined cycle and associated common facilities placed in service in August 2014 that are subject to the
$2.88 billion
cost cap and exclude post-in-service costs for the lignite mine. See "
Rate Recovery of Kemper IGCC Costs
–
2013 MPSC Rate Order
" herein for additional information.
|
(d)
|
Mississippi Power's 2010 Project Estimate included recovery of financing costs during construction rather than the accrual of AFUDC. This approach was not approved by the Mississippi PSC as described in "
Rate Recovery of Kemper IGCC Costs
–
2013 MPSC Rate Order
." The Current Cost Estimate also reflects the impact of a settlement agreement with the wholesale customers for cost-based rates under FERC's jurisdiction.
|
(e)
|
Non-capital Kemper IGCC-related costs incurred during construction were initially deferred as regulatory assets. Some of these costs are now included in rates and are being recognized through income; however, such costs continue to be included in the Current Cost Estimate and the Actual Costs at
December 31, 2016
. The wholesale portion of debt carrying costs, whether deferred or recognized through income, is not included in the Current Cost Estimate and the Actual Costs at
December 31, 2016
. See "
Rate Recovery of Kemper IGCC Costs
–
Regulatory Assets and Liabilities
" herein for additional information.
|
(f)
|
On April 8, 2016, Mississippi Power received approximately
$137 million
in additional grants from the DOE for the Kemper IGCC (Additional DOE Grants), which are expected to be used to reduce future rate impacts for customers.
|
(g)
|
The Current Cost Estimate and the Actual Costs include
$2.76 billion
that will not be recovered for costs above the cost cap,
$0.83 billion
of investment costs included in current rates for the combined cycle and related assets in service, and
$0.08 billion
of costs that were previously expensed for the combined cycle and related assets in service. The Current Cost Estimate and the Actual Costs exclude
$0.25 billion
of costs not included in current rates for post-June 2013 mine operations, the lignite fuel inventory, and the nitrogen plant capital lease, which will be included in the 2017 Rate Case to be filed by June 3, 2017. See Note 6 under "Capital Leases" and "Rate Recovery of Kemper IGCC Costs – 2017 Rate Case" herein for additional information.
|
Cost Category
|
Actual Costs
|
||
|
(in billions)
|
||
Gasifiers and Gas Clean-up Facilities
|
$
|
1.88
|
|
Lignite Mine Facility
|
0.31
|
|
|
CO
2
Pipeline Facilities
|
0.11
|
|
|
Combined Cycle and Common Facilities
|
0.16
|
|
|
AFUDC
|
0.69
|
|
|
General exceptions
|
0.07
|
|
|
Plant inventory
|
0.03
|
|
|
Lignite inventory
|
0.08
|
|
|
Regulatory and other deferred assets
|
0.12
|
|
|
Subtotal
|
3.45
|
|
|
Additional DOE Grants
|
(0.14
|
)
|
|
Total
|
$
|
3.31
|
|
Facility (Type)
|
Percent
Ownership
|
|
Plant in Service
|
|
Accumulated
Depreciation
|
|
CWIP
|
|||||||
|
|
|
(in millions)
|
|||||||||||
Plant Vogtle (nuclear) Units 1 and 2
|
45.7
|
%
|
|
$
|
3,545
|
|
|
$
|
2,111
|
|
|
$
|
74
|
|
Plant Hatch (nuclear)
|
50.1
|
|
|
1,297
|
|
|
585
|
|
|
81
|
|
|||
Plant Miller (coal) Units 1 and 2
|
91.8
|
|
|
1,657
|
|
|
587
|
|
|
23
|
|
|||
Plant Scherer (coal) Units 1 and 2
|
8.4
|
|
|
258
|
|
|
90
|
|
|
3
|
|
|||
Plant Wansley (coal)
|
53.5
|
|
|
1,046
|
|
|
308
|
|
|
12
|
|
|||
Rocky Mountain (pumped storage)
|
25.4
|
|
|
181
|
|
|
129
|
|
|
—
|
|
|||
Plant Stanton (combined cycle) Unit A
|
65.0
|
|
|
155
|
|
|
58
|
|
|
—
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Federal —
|
|
|
|
|
|
||||||
Current
|
$
|
1,184
|
|
|
$
|
(177
|
)
|
|
$
|
175
|
|
Deferred
|
(342
|
)
|
|
1,266
|
|
|
695
|
|
|||
|
842
|
|
|
1,089
|
|
|
870
|
|
|||
State —
|
|
|
|
|
|
||||||
Current
|
(108
|
)
|
|
(33
|
)
|
|
93
|
|
|||
Deferred
|
217
|
|
|
138
|
|
|
14
|
|
|||
|
109
|
|
|
105
|
|
|
107
|
|
|||
Total
|
$
|
951
|
|
|
$
|
1,194
|
|
|
$
|
977
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Deferred tax liabilities —
|
|
|
|
||||
Accelerated depreciation
|
$
|
15,392
|
|
|
$
|
12,767
|
|
Property basis differences
|
2,708
|
|
|
1,603
|
|
||
Leveraged lease basis differences
|
314
|
|
|
308
|
|
||
Employee benefit obligations
|
737
|
|
|
579
|
|
||
Premium on reacquired debt
|
89
|
|
|
95
|
|
||
Regulatory assets associated with employee benefit obligations
|
1,584
|
|
|
1,378
|
|
||
Regulatory assets associated with AROs
|
1,781
|
|
|
1,422
|
|
||
Other
|
907
|
|
|
793
|
|
||
Total
|
23,512
|
|
|
18,945
|
|
||
Deferred tax assets —
|
|
|
|
||||
Federal effect of state deferred taxes
|
597
|
|
|
479
|
|
||
Employee benefit obligations
|
1,868
|
|
|
1,720
|
|
||
Over recovered fuel clause
|
66
|
|
|
104
|
|
||
Other property basis differences
|
401
|
|
|
695
|
|
||
Deferred costs
|
100
|
|
|
83
|
|
||
ITC carryforward
|
1,974
|
|
|
770
|
|
||
Federal NOL carryforward
|
1,084
|
|
|
38
|
|
||
Unbilled revenue
|
92
|
|
|
111
|
|
||
Other comprehensive losses
|
152
|
|
|
85
|
|
||
AROs
|
1,732
|
|
|
1,482
|
|
||
Estimated Loss on Kemper IGCC
|
484
|
|
|
451
|
|
||
Deferred state tax assets
|
266
|
|
|
222
|
|
||
Other
|
679
|
|
|
443
|
|
||
Total
|
9,495
|
|
|
6,683
|
|
||
Valuation allowance
|
(23
|
)
|
|
(4
|
)
|
||
Total deferred income taxes
|
14,040
|
|
|
12,266
|
|
||
Portion included in accumulated deferred tax assets
|
(52
|
)
|
|
(56
|
)
|
||
Accumulated deferred income taxes
|
$
|
14,092
|
|
|
$
|
12,322
|
|
Jurisdiction
|
NOL Carryforwards
|
Net State Income Tax Benefit
|
Tax Year NOL
Begins Expiring
|
||||
|
(in millions)
|
|
|||||
Mississippi
|
$
|
3,448
|
|
$
|
112
|
|
2032
|
Oklahoma
|
839
|
|
31
|
|
2036
|
||
Georgia
|
685
|
|
25
|
|
2019
|
||
New York
|
229
|
|
11
|
|
2036
|
||
New York City
|
209
|
|
12
|
|
2036
|
||
Florida
|
198
|
|
7
|
|
2034
|
||
Other states
|
146
|
|
5
|
|
Various
|
||
Total
|
$
|
5,754
|
|
$
|
203
|
|
|
|
2016
|
|
2015
|
|
2014
|
|||
Federal statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income tax, net of federal deduction
|
2.1
|
|
|
1.9
|
|
|
2.3
|
|
Employee stock plans dividend deduction
|
(1.2
|
)
|
|
(1.2
|
)
|
|
(1.4
|
)
|
Non-deductible book depreciation
|
0.9
|
|
|
1.2
|
|
|
1.4
|
|
AFUDC-Equity
|
(2.0
|
)
|
|
(2.2
|
)
|
|
(2.9
|
)
|
ITC basis difference
|
(5.0
|
)
|
|
(1.5
|
)
|
|
(1.6
|
)
|
Federal PTCs
|
(1.2
|
)
|
|
—
|
|
|
—
|
|
Amortization of ITC
|
(0.9
|
)
|
|
(0.5
|
)
|
|
(0.5
|
)
|
Other
|
(0.4
|
)
|
|
0.2
|
|
|
0.2
|
|
Effective income tax rate
|
27.3
|
%
|
|
32.9
|
%
|
|
32.5
|
%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Unrecognized tax benefits at beginning of year
|
$
|
433
|
|
|
$
|
170
|
|
|
$
|
7
|
|
Tax positions increase from current periods
|
45
|
|
|
43
|
|
|
64
|
|
|||
Tax positions increase from prior periods
|
21
|
|
|
240
|
|
|
102
|
|
|||
Tax positions decrease from prior periods
|
(15
|
)
|
|
(20
|
)
|
|
(3
|
)
|
|||
Balance at end of year
|
$
|
484
|
|
|
$
|
433
|
|
|
$
|
170
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Tax positions impacting the effective tax rate
|
$
|
20
|
|
|
$
|
10
|
|
|
$
|
10
|
|
Tax positions not impacting the effective tax rate
|
464
|
|
|
423
|
|
|
160
|
|
|||
Balance of unrecognized tax benefits
|
$
|
484
|
|
|
$
|
433
|
|
|
$
|
170
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Senior notes
|
$
|
1,995
|
|
|
$
|
1,810
|
|
Other long-term debt
|
485
|
|
|
829
|
|
||
Pollution control revenue bonds
(*)
|
76
|
|
|
4
|
|
||
Capitalized leases
|
32
|
|
|
32
|
|
||
Unamortized debt issuance expense
|
(1
|
)
|
|
(1
|
)
|
||
Total
|
$
|
2,587
|
|
|
$
|
2,674
|
|
(*)
|
Includes
$40 million
of pollution control revenue bonds classified as short-term since they are variable rate demand obligations that are supported by short-term credit facilities; however, the final maturity date is in 2028.
|
|
Expires
|
|
|
|
Executable Term Loans
|
|
Expires Within
One Year
|
||||||||||||||||||||||||||||
Company
|
2017
|
|
2018
|
|
2020
|
|
Total
|
|
Unused
|
|
One
Year
|
|
Two
Years
|
|
Term Out
|
|
No Term Out
|
||||||||||||||||||
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
||||||||||||||||||||||||||||
Southern Company
(a)
|
$
|
—
|
|
|
$
|
1,000
|
|
|
$
|
1,250
|
|
|
$
|
2,250
|
|
|
$
|
2,250
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Alabama Power
|
35
|
|
|
500
|
|
|
800
|
|
|
1,335
|
|
|
1,335
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35
|
|
|||||||||
Georgia Power
|
—
|
|
|
—
|
|
|
1,750
|
|
|
1,750
|
|
|
1,732
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Gulf Power
|
85
|
|
|
195
|
|
|
—
|
|
|
280
|
|
|
280
|
|
|
45
|
|
|
—
|
|
|
25
|
|
|
60
|
|
|||||||||
Mississippi Power
|
173
|
|
|
—
|
|
|
—
|
|
|
173
|
|
|
150
|
|
|
—
|
|
|
13
|
|
|
13
|
|
|
160
|
|
|||||||||
Southern Power Company
(b)
|
—
|
|
|
—
|
|
|
600
|
|
|
600
|
|
|
522
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Southern Company Gas
(c)
|
75
|
|
|
1,925
|
|
|
—
|
|
|
2,000
|
|
|
1,949
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
75
|
|
|||||||||
Other
|
55
|
|
|
—
|
|
|
—
|
|
|
55
|
|
|
55
|
|
|
20
|
|
|
—
|
|
|
20
|
|
|
35
|
|
|||||||||
Southern Company Consolidated
|
$
|
423
|
|
|
$
|
3,620
|
|
|
$
|
4,400
|
|
|
$
|
8,443
|
|
|
$
|
8,273
|
|
|
$
|
65
|
|
|
$
|
13
|
|
|
$
|
58
|
|
|
$
|
365
|
|
(a)
|
Represents the Southern Company parent entity.
|
(b)
|
Excludes credit agreements (Project Credit Facilities) assumed with the acquisition of certain solar facilities, which were non-recourse to Southern Power Company, the proceeds of which were used to finance project costs related to such solar facilities. See Note 12 under "
Southern Power
" for additional information. Also excludes a
$120 million
continuing letter of credit facility entered into by Southern Power in December 2016 for standby letters of credit expiring in 2019. At December 31, 2016, the total amount available under the letter of credit facility was
$82 million
.
|
(c)
|
Southern Company Gas, as the parent entity, guarantees the obligations of Southern Company Gas Capital, which is the borrower of
$1.3 billion
of these arrangements. Southern Company Gas' committed credit arrangements also include
$700 million
for which Nicor Gas is the borrower and which is restricted for working capital needs of Nicor Gas.
|
|
Short-term Debt at the End of the Period
|
|||||
|
Amount
Outstanding
|
|
Weighted Average
Interest Rate
|
|||
|
(in millions)
|
|
|
|||
December 31, 2016:
|
|
|
|
|||
Commercial paper
|
$
|
1,909
|
|
|
1.1
|
%
|
Short-term bank debt
|
123
|
|
|
1.7
|
%
|
|
Total
|
$
|
2,032
|
|
|
1.1
|
%
|
December 31, 2015:
|
|
|
|
|||
Commercial paper
|
$
|
740
|
|
|
0.7
|
%
|
Short-term bank debt
|
500
|
|
|
1.4
|
%
|
|
Total
|
$
|
1,240
|
|
|
0.9
|
%
|
|
Redeemable Preferred Stock of Subsidiaries
|
||
|
(in millions)
|
||
Balance at December 31, 2013
|
$
|
375
|
|
Issued
|
—
|
|
|
Redeemed
|
—
|
|
|
Balance at December 31, 2014
|
375
|
|
|
Issued
|
—
|
|
|
Redeemed
|
(262
|
)
|
|
Other
|
5
|
|
|
Balance at December 31, 2015
|
118
|
|
|
Issued
|
—
|
|
|
Redeemed
|
—
|
|
|
Balance at December 31, 2016
|
$
|
118
|
|
|
Operating Leases
(*)
|
|
Other
|
||||
|
(in millions)
|
||||||
2017
|
$
|
242
|
|
|
$
|
8
|
|
2018
|
246
|
|
|
7
|
|
||
2019
|
249
|
|
|
6
|
|
||
2020
|
246
|
|
|
5
|
|
||
2021
|
249
|
|
|
5
|
|
||
2022 and thereafter
|
1,041
|
|
|
43
|
|
||
Total
|
$
|
2,273
|
|
|
$
|
74
|
|
(*)
|
A total of
$197 million
of biomass PPAs included under operating leases is contingent upon the counterparties meeting specified contract dates for commercial operation. Subsequent to December 31, 2016, the specified contract dates for commercial operation were extended from 2017 to 2019 and may change further as a result of regulatory action.
|
|
Minimum Lease Payments
|
||||||||||
|
Barges &
Railcars
|
|
Other
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
2017
|
$
|
31
|
|
|
$
|
121
|
|
|
$
|
152
|
|
2018
|
19
|
|
|
115
|
|
|
134
|
|
|||
2019
|
10
|
|
|
103
|
|
|
113
|
|
|||
2020
|
10
|
|
|
90
|
|
|
100
|
|
|||
2021
|
8
|
|
|
82
|
|
|
90
|
|
|||
2022 and thereafter
|
11
|
|
|
1,184
|
|
|
1,195
|
|
|||
Total
|
$
|
89
|
|
|
$
|
1,695
|
|
|
$
|
1,784
|
|
|
Shares Subject to Option
|
|
Weighted Average Exercise Price
|
|||
Outstanding at December 31, 2015
|
35,749,906
|
|
|
$
|
40.96
|
|
Exercised
|
11,120,613
|
|
|
40.26
|
|
|
Cancelled
|
43,429
|
|
|
41.38
|
|
|
Outstanding at December 31, 2016
|
24,585,864
|
|
|
$
|
41.28
|
|
Exercisable at December 31, 2016
|
21,133,320
|
|
|
$
|
41.26
|
|
Year Ended December 31
|
2016
|
|
2015
|
|
2014
|
Expected volatility
|
15.0%
|
|
12.9%
|
|
12.6%
|
Expected term
(in years)
|
3
|
|
3
|
|
3
|
Interest rate
|
0.8%
|
|
1.0%
|
|
0.6%
|
Annualized dividend rate
(*)
|
N/A
|
|
N/A
|
|
$2.03
|
Weighted average grant-date fair value
|
$45.06
|
|
$46.38
|
|
$37.54
|
(*)
|
Beginning in 2015, cash dividends paid on Southern Company's common stock are accumulated and payable in additional shares of Southern Company's common stock at the end of the
three
-year performance period and are embedded in the grant date fair value which equates to the grant date stock price.
|
|
Average Common Stock Shares
|
|||||||
|
2016
|
|
2015
|
|
2014
|
|||
|
(in millions)
|
|||||||
As reported shares
|
951
|
|
|
910
|
|
|
897
|
|
Effect of options and performance share award units
|
7
|
|
|
4
|
|
|
4
|
|
Diluted shares
|
958
|
|
|
914
|
|
|
901
|
|
•
|
Level 1 consists of observable market data in an active market for identical assets or liabilities.
|
•
|
Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.
|
•
|
Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
(a)(b)
|
$
|
338
|
|
|
$
|
333
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
671
|
|
Interest rate derivatives
|
—
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
14
|
|
|||||
Nuclear decommissioning trusts:
(c)
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
|
589
|
|
|
73
|
|
|
—
|
|
|
—
|
|
|
662
|
|
|||||
Foreign equity
|
48
|
|
|
168
|
|
|
—
|
|
|
—
|
|
|
216
|
|
|||||
U.S. Treasury and government agency securities
|
—
|
|
|
92
|
|
|
—
|
|
|
—
|
|
|
92
|
|
|||||
Municipal bonds
|
—
|
|
|
73
|
|
|
—
|
|
|
—
|
|
|
73
|
|
|||||
Corporate bonds
|
22
|
|
|
310
|
|
|
—
|
|
|
—
|
|
|
332
|
|
|||||
Mortgage and asset backed securities
|
—
|
|
|
183
|
|
|
—
|
|
|
—
|
|
|
183
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
20
|
|
|
20
|
|
|||||
Other
|
11
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
26
|
|
|||||
Cash equivalents
|
1,172
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,172
|
|
|||||
Other investments
|
9
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
10
|
|
|||||
Total
|
$
|
2,189
|
|
|
$
|
1,261
|
|
|
$
|
1
|
|
|
$
|
20
|
|
|
$
|
3,471
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
(a)(b)
|
$
|
345
|
|
|
$
|
285
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
630
|
|
Interest rate derivatives
|
—
|
|
|
29
|
|
|
—
|
|
|
—
|
|
|
29
|
|
|||||
Foreign currency derivatives
|
—
|
|
|
58
|
|
|
—
|
|
|
—
|
|
|
58
|
|
|||||
Contingent consideration
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
18
|
|
|||||
Total
|
$
|
345
|
|
|
$
|
372
|
|
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
735
|
|
(a)
|
Energy-related derivatives exclude
$4 million
associated with certain weather derivatives accounted for based on intrinsic value rather than fair value.
|
(b)
|
Energy-related derivatives exclude cash collateral of
$62 million
.
|
(c)
|
Includes the investment securities pledged to creditors and collateral received, and excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases and the lending pool. See Note 1 under "
Nuclear Decommissioning
" for additional information.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7
|
|
Interest rate derivatives
|
—
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|||||
Nuclear decommissioning trusts:
(*)
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
|
541
|
|
|
69
|
|
|
—
|
|
|
—
|
|
|
610
|
|
|||||
Foreign equity
|
47
|
|
|
160
|
|
|
—
|
|
|
—
|
|
|
207
|
|
|||||
U.S. Treasury and government agency securities
|
—
|
|
|
152
|
|
|
—
|
|
|
—
|
|
|
152
|
|
|||||
Municipal bonds
|
—
|
|
|
64
|
|
|
—
|
|
|
—
|
|
|
64
|
|
|||||
Corporate bonds
|
11
|
|
|
278
|
|
|
—
|
|
|
—
|
|
|
289
|
|
|||||
Mortgage and asset backed securities
|
—
|
|
|
145
|
|
|
—
|
|
|
—
|
|
|
145
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
17
|
|
|||||
Other
|
16
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
25
|
|
|||||
Cash equivalents
|
790
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
790
|
|
|||||
Other investments
|
9
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
10
|
|
|||||
Total
|
$
|
1,414
|
|
|
$
|
906
|
|
|
$
|
1
|
|
|
$
|
17
|
|
|
$
|
2,338
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
220
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
220
|
|
Interest rate derivatives
|
—
|
|
|
30
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|||||
Total
|
$
|
—
|
|
|
$
|
250
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
250
|
|
(*)
|
Includes the investment securities pledged to creditors and collateral received, and excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases and the lending pool. See Note 1 under "
Nuclear Decommissioning
" for additional information.
|
|
Fair
Value |
|
Unfunded
Commitments |
|
Redemption
Frequency |
|
Redemption
Notice Period |
||||
|
(in millions)
|
|
|
|
|
||||||
As of December 31, 2016
|
$
|
20
|
|
|
$
|
25
|
|
|
Not Applicable
|
|
Not Applicable
|
As of December 31, 2015
|
$
|
17
|
|
|
$
|
28
|
|
|
Not Applicable
|
|
Not Applicable
|
|
Carrying
Amount
|
|
Fair
Value
|
||||
|
(in millions)
|
||||||
Long-term debt, including securities due within one year:
|
|
|
|
||||
2016
|
$
|
45,080
|
|
|
$
|
46,286
|
|
2015
|
$
|
27,216
|
|
|
$
|
27,913
|
|
•
|
Regulatory Hedges
– Energy-related derivative contracts which are designated as regulatory hedges relate primarily to the traditional electric operating companies' and natural gas distribution utilities' fuel-hedging programs, where gains and losses are initially recorded as regulatory liabilities and assets, respectively, and then are included in fuel expense as the underlying fuel is used in operations and ultimately recovered through the respective fuel cost recovery clauses.
|
•
|
Cash Flow Hedges
– Gains and losses on energy-related derivatives designated as cash flow hedges (which are mainly used to hedge anticipated purchases and sales) are initially deferred in OCI before being recognized in the statements of income in the same period as the hedged transactions are reflected in earnings.
|
•
|
Not Designated
– Gains and losses on energy-related derivative contracts that are not designated or fail to qualify as hedges are recognized in the statements of income as incurred.
|
(a)
|
Swaption at RE Roserock LLC. See Note 12 for additional information.
|
(b)
|
Amortizing notional amount.
|
(c)
|
Represents the mandatory settlement date. Settlement amount was based on a
15
-year amortizing swap.
|
|
Pay Notional
|
Pay Rate
|
Receive Notional
|
Receive Rate
|
Hedge
Maturity Date |
Fair Value
Gain (Loss) at December 31, 2016 |
||||||
|
(in millions)
|
|
(in millions)
|
|
|
(in millions)
|
||||||
Cash Flow Hedges of Existing Debt
|
|
|
|
|
|
|||||||
|
$
|
677
|
|
2.95%
|
€
|
600
|
|
1.00%
|
June 2022
|
$
|
(34
|
)
|
|
564
|
|
3.78%
|
500
|
|
1.85%
|
June 2026
|
(24
|
)
|
|||
Total
|
$
|
1,241
|
|
|
€
|
1,100
|
|
|
|
$
|
(58
|
)
|
|
2016
|
|
2015
|
||||||||||
Derivative Category and Balance Sheet Location
|
Assets
|
Liabilities
|
|
Assets
|
Liabilities
|
||||||||
|
(in millions)
|
||||||||||||
Derivatives designated as hedging instruments for regulatory purposes
|
|
|
|
|
|
||||||||
Energy-related derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Liabilities from risk management activities, net of collateral
|
$
|
73
|
|
$
|
27
|
|
|
$
|
3
|
|
$
|
130
|
|
Other deferred charges and assets/Other deferred credits and liabilities
|
25
|
|
33
|
|
|
—
|
|
87
|
|
||||
Total derivatives designated as hedging instruments for regulatory purposes
|
$
|
98
|
|
$
|
60
|
|
|
$
|
3
|
|
$
|
217
|
|
Derivatives designated as hedging instruments in cash flow and fair value hedges
|
|
|
|
|
|
||||||||
Energy-related derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Liabilities from risk management activities, net of collateral
|
$
|
23
|
|
$
|
7
|
|
|
$
|
3
|
|
$
|
2
|
|
Interest rate derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Liabilities from risk management activities, net of collateral
|
12
|
|
1
|
|
|
19
|
|
23
|
|
||||
Other deferred charges and assets/Other deferred credits and liabilities
|
1
|
|
28
|
|
|
—
|
|
7
|
|
||||
Foreign currency derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Liabilities from risk management activities, net of collateral
|
—
|
|
25
|
|
|
—
|
|
—
|
|
||||
Other deferred charges and assets/Other deferred credits and liabilities
|
—
|
|
33
|
|
|
—
|
|
—
|
|
||||
Total derivatives designated as hedging instruments in cash flow and fair value hedges
|
$
|
36
|
|
$
|
94
|
|
|
$
|
22
|
|
$
|
32
|
|
Derivatives not designated as hedging instruments
|
|
|
|
|
|
||||||||
Energy-related derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Liabilities from risk management activities, net of collateral
|
$
|
489
|
|
$
|
483
|
|
|
$
|
1
|
|
$
|
1
|
|
Other deferred charges and assets/Other deferred credits and liabilities
|
66
|
|
81
|
|
|
—
|
|
—
|
|
||||
Interest rate derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Liabilities from risk management activities, net of collateral
|
1
|
|
—
|
|
|
3
|
|
—
|
|
||||
Total derivatives not designated as hedging instruments
|
$
|
556
|
|
$
|
564
|
|
|
$
|
4
|
|
$
|
1
|
|
Gross amounts recognized
|
$
|
690
|
|
$
|
718
|
|
|
$
|
29
|
|
$
|
250
|
|
Gross amounts offset
(a)
|
$
|
(462
|
)
|
$
|
(524
|
)
|
|
$
|
(15
|
)
|
$
|
(15
|
)
|
Net amounts recognized in the Balance Sheets
(b)
|
$
|
228
|
|
$
|
194
|
|
|
$
|
14
|
|
$
|
235
|
|
(a)
|
Gross amounts offset include cash collateral held on deposit in broker margin accounts of
$62 million
as of
December 31, 2016
.
|
(b)
|
At
December 31, 2015
, the fair value amounts for derivative contracts subject to netting arrangements were presented gross on the balance sheet.
|
|
Unrealized Losses
|
|
Unrealized Gains
|
||||||||||||||
Derivative Category
|
Balance Sheet Location
|
2016
|
|
2015
|
|
Balance Sheet Location
|
2016
|
|
2015
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Energy-related derivatives:
(a)
|
Other regulatory assets, current
|
$
|
(16
|
)
|
|
$
|
(130
|
)
|
|
Other regulatory liabilities, current
|
$
|
56
|
|
|
$
|
3
|
|
|
Other regulatory assets, deferred
|
(19
|
)
|
|
(87
|
)
|
|
Other regulatory liabilities, deferred
|
12
|
|
|
—
|
|
||||
Total energy-related derivative gains (losses)
(b)
|
|
$
|
(35
|
)
|
|
$
|
(217
|
)
|
|
|
$
|
68
|
|
|
$
|
3
|
|
(a)
|
At
December 31, 2016
, the unrealized gains and losses for derivative contracts subject to netting arrangements were presented net on the balance sheet. At
December 31, 2015
, the unrealized gains and losses for derivative contracts were presented gross on the balance sheet.
|
(b)
|
Fair value gains and losses recorded in regulatory assets and liabilities include cash collateral held on deposit in broker margin accounts of
$8 million
as of
December 31, 2016
.
|
Derivatives in Cash Flow Hedging Relationships
|
Gain (Loss) Recognized in OCI on Derivative (Effective Portion)
|
|
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
|||||||||||||||||||||
|
Amount
|
|
|
Amount
|
||||||||||||||||||||
Derivative Category
|
2016
|
|
2015
|
|
2014
|
|
Statements of Income Location
|
2016
|
|
2015
|
|
2014
|
||||||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||||||||||
Energy-related derivatives
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Depreciation and amortization
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
Cost of natural gas
|
(1
|
)
|
|
—
|
|
|
—
|
|
||||||
Interest rate derivatives
|
(180
|
)
|
|
(22
|
)
|
|
(16
|
)
|
|
Interest expense, net of amounts capitalized
|
(18
|
)
|
|
(9
|
)
|
|
(8
|
)
|
||||||
Foreign currency derivatives
|
(58
|
)
|
|
—
|
|
|
—
|
|
|
Interest expense, net of amounts capitalized
|
(13
|
)
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
Other income (expense), net
(*)
|
(82
|
)
|
|
—
|
|
|
—
|
|
||||||
Total
|
$
|
(220
|
)
|
|
$
|
(22
|
)
|
|
$
|
(16
|
)
|
|
|
$
|
(112
|
)
|
|
$
|
(9
|
)
|
|
$
|
(8
|
)
|
(*)
|
The reclassification from accumulated OCI into other income (expense), net completely offsets currency gains and losses arising from changes in the U.S. currency exchange rates used to record the euro-denominated notes.
|
Derivatives in Fair Value Hedging Relationships
|
|
Gain (Loss)
|
||||||||||
Derivative Category
|
Statements of Income Location
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(in millions)
|
||||||||||
Interest rate derivatives:
|
Interest expense, net of amounts capitalized
|
$
|
(21
|
)
|
|
$
|
2
|
|
|
$
|
(3
|
)
|
Derivatives Not Designated as Hedging Instruments
|
|
Unrealized Gain (Loss) Recognized in Income
|
||||||||||
|
|
Amount
|
||||||||||
Derivative Category
|
Statements of Income Location
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
(in millions)
|
||||||||||
Energy-related derivatives
|
Wholesale electric revenues
|
$
|
2
|
|
|
$
|
(5
|
)
|
|
$
|
6
|
|
|
Fuel
|
—
|
|
|
3
|
|
|
(4
|
)
|
|||
|
Natural gas revenues
(*)
|
33
|
|
|
—
|
|
|
—
|
|
|||
|
Cost of natural gas
|
3
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
38
|
|
|
$
|
(2
|
)
|
|
$
|
2
|
|
(*)
|
Excludes gains (losses) recorded in cost of natural gas associated with weather derivatives of
$6 million
for the period ended
December 31, 2016
.
|
Southern Company Gas Purchase Price
|
December 31, 2016
|
||
|
(in millions)
|
||
Current assets
|
$
|
1,557
|
|
Property, plant, and equipment
|
10,108
|
|
|
Goodwill
|
5,967
|
|
|
Intangible assets
|
400
|
|
|
Regulatory assets
|
1,118
|
|
|
Other assets
|
229
|
|
|
Current liabilities
|
(2,201
|
)
|
|
Other liabilities
|
(4,742
|
)
|
|
Long-term debt
|
(4,261
|
)
|
|
Noncontrolling interests
|
(174
|
)
|
|
Total purchase price
|
$
|
8,001
|
|
|
2016
|
2015
|
||||
|
|
|
||||
Operating revenues (in millions)
|
$
|
21,791
|
|
$
|
21,430
|
|
Net income attributable to Southern Company (in millions)
|
$
|
2,591
|
|
$
|
2,665
|
|
Basic EPS
|
$
|
2.70
|
|
$
|
2.85
|
|
Diluted EPS
|
$
|
2.68
|
|
$
|
2.84
|
|
PowerSecure Purchase Price
|
December 31, 2016
|
||
|
(in millions)
|
||
Current assets
|
$
|
172
|
|
Property, plant, and equipment
|
46
|
|
|
Intangible assets
|
101
|
|
|
Goodwill
|
282
|
|
|
Other assets
|
4
|
|
|
Current liabilities
|
(114
|
)
|
|
Long-term debt, including current portion
|
(48
|
)
|
|
Deferred credits and other liabilities
|
(14
|
)
|
|
Total purchase price
|
$
|
429
|
|
Project Facility
|
Resource
|
Seller; Acquisition Date
|
Approximate Nameplate Capacity (MW)
|
|
Location
|
Southern Power Percentage Ownership
|
Actual/Expected COD
|
PPA Contract Period
|
||
Acquisitions During the Year Ended December 31, 2016
|
||||||||||
Boulder 1
|
Solar
|
SunPower Corp.
November 16, 2016 |
100
|
|
Clark County, NV
|
51
|
%
|
(a)
|
December 2016
|
20 years
|
Calipatria
|
Solar
|
Solar Frontier Americas Holding LLC
February 11, 2016 |
20
|
|
Imperial County, CA
|
90
|
%
|
(b)
|
February 2016
|
20 years
|
East Pecos
|
Solar
|
First Solar, Inc.
March 4, 2016 |
120
|
|
Pecos County, TX
|
100
|
%
|
|
March 2017
|
15 years
|
Grant Plains
|
Wind
|
Apex Clean Energy Holdings, LLC
August 26, 2016 |
147
|
|
Grant County, OK
|
100
|
%
|
|
December 2016
|
20 years and 12 years
(c)
|
Grant Wind
|
Wind
|
Apex Clean Energy Holdings, LLC
April 7, 2016 |
151
|
|
Grant County, OK
|
100
|
%
|
|
April 2016
|
20 years
|
Henrietta
|
Solar
|
SunPower Corp.
July 1, 2016 |
102
|
|
Kings County, CA
|
51
|
%
|
(a)
|
July 2016
|
20 years
|
Lamesa
|
Solar
|
RES America Developments Inc.
July 1, 2016 |
102
|
|
Dawson County, TX
|
100
|
%
|
|
Second quarter 2017
|
15 years
|
Mankato
(d)
|
Natural Gas
|
Calpine Corporation October 26, 2016
|
375
|
|
Mankato, MN
|
100
|
%
|
|
N/A
(e)
|
10 years
|
Passadumkeag
|
Wind
|
Quantum Utility Generation, LLC
June 30, 2016 |
42
|
|
Penobscot County, ME
|
100
|
%
|
|
July 2016
|
15 years
|
Rutherford
|
Solar
|
Cypress Creek Renewables, LLC
July 1, 2016 |
74
|
|
Rutherford County, NC
|
90
|
%
|
(b)
|
December 2016
|
15 years
|
Salt Fork
|
Wind
|
EDF Renewable Energy, Inc.
December 1, 2016 |
174
|
|
Donley and Gray Counties, TX
|
100
|
%
|
|
December 2016
|
14 years and 12 years
|
Tyler Bluff
|
Wind
|
EDF Renewable Energy, Inc.
December 21, 2016 |
125
|
|
Cooke County, TX
|
100
|
%
|
|
December 2016
|
12 years
|
Wake Wind
|
Wind
|
Invenergy Wind
Global LLC
October 26, 2016 |
257
|
|
Floyd and Crosby Counties, TX
|
90.1
|
%
|
(f)
|
October 2016
|
12 years
|
Acquisitions Subsequent to December 31, 2016
|
||||||||||
Bethel
|
Wind
|
Invenergy Wind
Global LLC
January 6, 2017 |
276
|
|
Castro County, TX
|
100
|
%
|
|
January 2017
|
12 years
|
(a)
|
Southern Power owns
100%
of the class A membership interests and a wholly-owned subsidiary of the seller owns
100%
of the class B membership interests. Southern Power and the class B member are entitled to
51%
and
49%
, respectively, of all cash distributions from the project. In addition, Southern Power is entitled to substantially all of the federal tax benefits with respect to the transaction.
|
(b)
|
Southern Power owns
90%
, with the minority owner, Turner Renewable Energy, LLC (TRE), owning
10%
.
|
(c)
|
In addition to the
20
-year and
12
-year PPAs, the facility has a
10
-year contract with Allianz Risk Transfer (Bermuda) Ltd.
|
(d)
|
Under the terms of the remaining
10
-year PPA and the
20
-year expansion PPA, approximately
$408 million
of assets, primarily related to property, plant, and equipment, are subject to lien at December 31, 2016.
|
(e)
|
The acquisition included a fully operational
375
-MW natural gas-fired combined-cycle facility.
|
(f)
|
Southern Power owns
90.1%
, with the minority owner, Invenergy Wind Global LLC, owning
9.9%
.
|
|
2016
|
||
|
(in millions)
|
||
CWIP
|
$
|
2,354
|
|
Property, plant, and equipment
|
302
|
|
|
Intangible assets
(a)
|
128
|
|
|
Other assets
|
52
|
|
|
Accounts payable
|
(16
|
)
|
|
Debt
|
(217
|
)
|
|
Total purchase price
|
$
|
2,603
|
|
|
|
||
Funded by:
|
|
||
Southern Power
(b)(c)
|
$
|
2,345
|
|
Noncontrolling interests
(d)(e)
|
258
|
|
|
Total purchase price
|
$
|
2,603
|
|
(a)
|
Intangible assets consist of acquired PPAs that will be amortized over
10
and
20
-year terms. The estimated amortization for future periods is approximately
$9 million
per year.
|
(b)
|
At
December 31, 2016
,
$461 million
is included in acquisitions payable on the balance sheets.
|
(c)
|
Includes approximately
$281 million
of contingent consideration, of which
$67 million
remains payable at December 31, 2016.
|
(d)
|
Includes approximately
$51 million
of non-cash contributions recorded as capital contributions from noncontrolling interests in the statements of stockholders' equity.
|
(e)
|
Includes approximately
$142 million
of contingent consideration, all of which had been paid at December 31, 2016 by the noncontrolling interests.
|
Project Facility
|
Resource
|
Seller; Acquisition Date
|
Approximate
Nameplate Capacity ( MW ) |
|
Location
|
Southern Power
Percentage Ownership
|
Actual COD
|
PPA
Contract Period |
||
Acquisitions for the Year Ended December 31, 2015
|
||||||||||
Desert Stateline
|
Solar
|
First Solar Inc.
August 31, 2015 |
299
(a)
|
|
San Bernardino County, CA
|
51
|
%
|
(b)
|
From December 2015 to July 2016
|
20 years
|
Garland and Garland A
|
Solar
|
Recurrent Energy, LLC
December 17, 2015 |
205
|
|
Kern County, CA
|
51
|
%
|
(b)
|
October and August 2016
|
15 years and 20 years
|
Kay Wind
|
Wind
|
Apex Clean Energy Holdings, LLC December 11, 2015
|
299
|
|
Kay County, OK
|
100
|
%
|
|
December 2015
|
20 years
|
Lost Hills Blackwell
|
Solar
|
First Solar Inc.
April 15, 2015 |
33
|
|
Kern County, CA
|
51
|
%
|
(b)
|
April 2015
|
29 years
|
Morelos
|
Solar
|
Solar Frontier Americas Holding, LLC
October 22, 2015 |
15
|
|
Kern County, CA
|
90
|
%
|
(c)
|
November 2015
|
20 years
|
North Star
|
Solar
|
First Solar Inc.
April 30, 2015 |
61
|
|
Fresno County, CA
|
51
|
%
|
(b)
|
June 2015
|
20 years
|
Roserock
|
Solar
|
Recurrent Energy, LLC November 23, 2015
|
160
|
|
Pecos County, TX
|
51
|
%
|
(b)
|
November 2016
|
20 years
|
Tranquillity
|
Solar
|
Recurrent Energy, LLC
August 28, 2015 |
205
|
|
Fresno County, CA
|
51
|
%
|
(b)
|
July 2016
|
18 years
|
(a)
|
The facility has a total of
299
MWs, of which
110
MWs were placed in service in the fourth quarter 2015 and the remainder by July 2016.
|
(b)
|
Southern Power owns
100%
of the class A membership interests and a wholly-owned subsidiary of the seller owns
100%
of the class B membership interests. Southern Power and the class B member are entitled to
51%
and
49%
, respectively, of all cash distributions from the project. In addition, Southern Power is entitled to substantially all of the federal tax benefits with respect to the transaction.
|
(c)
|
Southern Power owns
90%
, with the minority owner, TRE, owning
10%
.
|
|
2015
|
||
|
(in millions)
|
||
CWIP
|
$
|
1,367
|
|
Property, plant, and equipment
|
315
|
|
|
Intangible assets
(a)
|
274
|
|
|
Other assets
|
64
|
|
|
Accounts payable
|
(89
|
)
|
|
Total purchase price
|
$
|
1,931
|
|
|
|
||
Funded by:
|
|
||
Southern Power
(b)
|
$
|
1,440
|
|
Noncontrolling interests
(c) (d)
|
491
|
|
|
Total purchase price
|
$
|
1,931
|
|
(a)
|
Intangible assets consist of acquired PPAs that will be amortized over
20
-year terms. The estimated amortization for future periods is approximately
$14 million
per year.
|
(b)
|
Includes approximately
$195 million
of contingent consideration, all of which has been paid at
December 31, 2016
.
|
(c)
|
Includes approximately
$227 million
of non-cash contributions recorded as capital contributions from noncontrolling interests in the statements of stockholders' equity.
|
(d)
|
Includes approximately
$76 million
of contingent consideration, all of which had been paid at December 31, 2016 by the noncontrolling interests.
|
Solar Facility
|
Seller
|
Approximate Nameplate Capacity (
MW
)
|
Location
|
Actual COD
|
PPA Contract Period
|
Butler
|
CERSM, LLC and Community Energy, Inc.
|
103
|
Taylor County, GA
|
December 2016
|
30 years
(a)
|
Butler Solar Farm
|
Strata Solar Development, LLC
|
22
|
Taylor County, GA
|
February 2016
|
20 years
(a)
|
Desert Stateline
|
First Solar Development, LLC
|
299
(b)
|
San Bernardino County, CA
|
From December 2015 to July 2016
|
20 years
|
Garland
|
Recurrent Energy, LLC
|
185
|
Kern County, CA
|
October 2016
|
15 years
|
Garland A
|
Recurrent Energy, LLC
|
20
|
Kern County, CA
|
August 2016
|
20 years
|
Pawpaw
|
Longview Solar, LLC
|
30
|
Taylor County, GA
|
March 2016
|
30 years
|
Roserock
(c)
|
Recurrent Energy, LLC
|
160
|
Pecos County, TX
|
November 2016
|
20 years
|
Sandhills
|
N/A
|
146
|
Taylor County, GA
|
October 2016
|
25 years
|
Tranquillity
|
Recurrent Energy, LLC
|
205
|
Fresno County, CA
|
July 2016
|
18 years
|
(a)
|
Affiliate PPA approved by the FERC.
|
(b)
|
The facility has a total of
299
MWs, of which
110
MWs were placed in service in the fourth quarter 2015 and the remainder by July 2016.
|
(c)
|
Prior to placing the Roserock facility in service, certain solar panels were damaged. While the facility is currently generating energy as expected, Southern Power is pursuing remedies under its insurance policies and other contracts to repair or replace these solar panels.
|
Project Facility
|
Resource
|
Approximate Nameplate Capacity (MW)
|
Location
|
Actual/Expected COD
|
PPA Contract Period
|
East Pecos
|
Solar
|
120
|
Pecos County, TX
|
March 2017
|
15 years
|
Lamesa
|
Solar
|
102
|
Dawson County, TX
|
Second quarter 2017
|
15 years
|
Mankato
|
Natural Gas
|
345
|
Mankato, MN
|
Second quarter 2019
|
20 years
|
|
Electric Utilities
|
|
|
|
|
|||||||||||||||||||
|
Traditional
Electric
Operating
Companies
|
Southern
Power
|
Eliminations
|
Total
|
Southern Company Gas
|
All
Other
|
Eliminations
|
Consolidated
|
||||||||||||||||
|
(in millions)
|
|||||||||||||||||||||||
2016
|
|
|
|
|
|
|
|
|
||||||||||||||||
Operating revenues
|
$
|
16,803
|
|
$
|
1,577
|
|
$
|
(439
|
)
|
$
|
17,941
|
|
$
|
1,652
|
|
$
|
463
|
|
$
|
(160
|
)
|
$
|
19,896
|
|
Depreciation and amortization
|
1,881
|
|
352
|
|
—
|
|
2,233
|
|
238
|
|
31
|
|
—
|
|
2,502
|
|
||||||||
Interest income
|
6
|
|
7
|
|
—
|
|
13
|
|
2
|
|
20
|
|
(15
|
)
|
20
|
|
||||||||
Earnings from equity method investments
|
2
|
|
—
|
|
—
|
|
2
|
|
60
|
|
(3
|
)
|
—
|
|
59
|
|
||||||||
Interest expense
|
814
|
|
117
|
|
—
|
|
931
|
|
81
|
|
317
|
|
(12
|
)
|
1,317
|
|
||||||||
Income taxes
|
1,286
|
|
(195
|
)
|
—
|
|
1,091
|
|
76
|
|
(216
|
)
|
—
|
|
951
|
|
||||||||
Segment net income (loss)
(a) (b)
|
2,233
|
|
338
|
|
—
|
|
2,571
|
|
114
|
|
(230
|
)
|
(7
|
)
|
2,448
|
|
||||||||
Total assets
|
72,141
|
|
15,169
|
|
(316
|
)
|
86,994
|
|
21,853
|
|
2,474
|
|
(1,624
|
)
|
109,697
|
|
||||||||
Gross property additions
|
4,852
|
|
2,114
|
|
—
|
|
6,966
|
|
618
|
|
41
|
|
(1
|
)
|
7,624
|
|
||||||||
2015
|
|
|
|
|
|
|
|
|
||||||||||||||||
Operating revenues
|
$
|
16,491
|
|
$
|
1,390
|
|
$
|
(439
|
)
|
$
|
17,442
|
|
$
|
—
|
|
$
|
152
|
|
$
|
(105
|
)
|
$
|
17,489
|
|
Depreciation and amortization
|
1,772
|
|
248
|
|
—
|
|
2,020
|
|
—
|
|
14
|
|
—
|
|
2,034
|
|
||||||||
Interest income
|
19
|
|
2
|
|
1
|
|
22
|
|
—
|
|
6
|
|
(5
|
)
|
23
|
|
||||||||
Earnings from equity method investments
|
1
|
|
—
|
|
—
|
|
1
|
|
—
|
|
(1
|
)
|
—
|
|
—
|
|
||||||||
Interest expense
|
697
|
|
77
|
|
—
|
|
774
|
|
—
|
|
69
|
|
(3
|
)
|
840
|
|
||||||||
Income taxes
|
1,305
|
|
21
|
|
—
|
|
1,326
|
|
—
|
|
(132
|
)
|
—
|
|
1,194
|
|
||||||||
Segment net income (loss)
(a) (b)
|
2,186
|
|
215
|
|
—
|
|
2,401
|
|
—
|
|
(32
|
)
|
(2
|
)
|
2,367
|
|
||||||||
Total assets
|
69,052
|
|
8,905
|
|
(397
|
)
|
77,560
|
|
—
|
|
1,819
|
|
(1,061
|
)
|
78,318
|
|
||||||||
Gross property additions
|
5,124
|
|
1,005
|
|
—
|
|
6,129
|
|
—
|
|
40
|
|
—
|
|
6,169
|
|
||||||||
2014
|
|
|
|
|
|
|
|
|
||||||||||||||||
Operating revenues
|
$
|
17,354
|
|
$
|
1,501
|
|
$
|
(449
|
)
|
$
|
18,406
|
|
$
|
—
|
|
$
|
159
|
|
$
|
(98
|
)
|
$
|
18,467
|
|
Depreciation and amortization
|
1,709
|
|
220
|
|
—
|
|
1,929
|
|
—
|
|
16
|
|
—
|
|
1,945
|
|
||||||||
Interest income
|
17
|
|
1
|
|
—
|
|
18
|
|
—
|
|
3
|
|
(2
|
)
|
19
|
|
||||||||
Earnings from equity method investments
|
1
|
|
—
|
|
—
|
|
1
|
|
—
|
|
(1
|
)
|
—
|
|
—
|
|
||||||||
Interest expense
|
705
|
|
89
|
|
—
|
|
794
|
|
—
|
|
43
|
|
(2
|
)
|
835
|
|
||||||||
Income taxes
|
1,056
|
|
(3
|
)
|
—
|
|
1,053
|
|
—
|
|
(76
|
)
|
—
|
|
977
|
|
||||||||
Segment net income (loss)
(a) (b)
|
1,797
|
|
172
|
|
—
|
|
1,969
|
|
—
|
|
(3
|
)
|
(3
|
)
|
1,963
|
|
||||||||
Total assets
(c)
|
64,300
|
|
5,233
|
|
(131
|
)
|
69,402
|
|
—
|
|
1,143
|
|
(312
|
)
|
70,233
|
|
||||||||
Gross property additions
|
5,568
|
|
942
|
|
—
|
|
6,510
|
|
—
|
|
11
|
|
1
|
|
6,522
|
|
(a)
|
Attributable to Southern Company.
|
(b)
|
Segment net income (loss) for the traditional electric operating companies includes pre-tax charges for estimated probable losses on the Kemper IGCC of
$428 million
(
$264 million
after tax) in 2016,
$365 million
(
$226 million
after tax) in 2015, and
$868 million
(
$536 million
after tax) in 2014. See Note 3 under "
Integrated Coal Gasification Combined Cycle
–
Kemper IGCC Schedule and Cost Estimate
" for additional information.
|
(c)
|
Net of
$202 million
of unamortized debt issuance costs as of December 31, 2014.
Also net of
$488 million
of deferred tax assets as of December 31, 2014.
|
Electric Utilities' Revenues
|
|||||||||||||||
Year
|
Retail
|
|
Wholesale
|
|
Other
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
2016
|
$
|
15,234
|
|
|
$
|
1,926
|
|
|
$
|
781
|
|
|
$
|
17,941
|
|
2015
|
14,987
|
|
|
1,798
|
|
|
657
|
|
|
17,442
|
|
||||
2014
|
15,550
|
|
|
2,184
|
|
|
672
|
|
|
18,406
|
|
|
|
|
|
|
Consolidated Net Income Attributable to Southern Company
|
|
Per Common Share
|
||||||||||||||||||||||||
|
Operating
Revenues
|
|
Operating
Income
|
|
|
Basic
Earnings
|
|
Diluted Earnings
|
|
|
|
Trading
Price Range
|
|||||||||||||||||||
Quarter Ended
|
|
Dividends
|
|
High
|
|
Low
|
|||||||||||||||||||||||||
|
(in millions)
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
March 2016
|
$
|
3,992
|
|
|
$
|
940
|
|
|
$
|
489
|
|
|
$
|
0.53
|
|
|
$
|
0.53
|
|
|
$
|
0.5425
|
|
|
$
|
51.73
|
|
|
$
|
46.00
|
|
June 2016
|
4,459
|
|
|
1,185
|
|
|
623
|
|
|
0.67
|
|
|
0.66
|
|
|
0.5600
|
|
|
53.64
|
|
|
47.62
|
|
||||||||
September 2016
|
6,264
|
|
|
1,917
|
|
|
1,139
|
|
|
1.18
|
|
|
1.17
|
|
|
0.5600
|
|
|
54.64
|
|
|
50.00
|
|
||||||||
December 2016
|
5,181
|
|
|
587
|
|
|
197
|
|
|
0.20
|
|
|
0.20
|
|
|
0.5600
|
|
|
52.23
|
|
|
46.20
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
March 2015
|
$
|
4,183
|
|
|
$
|
957
|
|
|
$
|
508
|
|
|
$
|
0.56
|
|
|
$
|
0.56
|
|
|
$
|
0.5250
|
|
|
$
|
53.16
|
|
|
$
|
43.55
|
|
June 2015
|
4,337
|
|
|
1,098
|
|
|
629
|
|
|
0.69
|
|
|
0.69
|
|
|
0.5425
|
|
|
45.44
|
|
|
41.40
|
|
||||||||
September 2015
|
5,401
|
|
|
1,649
|
|
|
959
|
|
|
1.05
|
|
|
1.05
|
|
|
0.5425
|
|
|
46.84
|
|
|
41.81
|
|
||||||||
December 2015
|
3,568
|
|
|
578
|
|
|
271
|
|
|
0.30
|
|
|
0.30
|
|
|
0.5425
|
|
|
47.50
|
|
|
43.38
|
|
|
2016
(a)
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (in millions)
|
$
|
19,896
|
|
|
$
|
17,489
|
|
|
$
|
18,467
|
|
|
$
|
17,087
|
|
|
$
|
16,537
|
|
Total Assets (in millions)
(b)(c)
|
$
|
109,697
|
|
|
$
|
78,318
|
|
|
$
|
70,233
|
|
|
$
|
64,264
|
|
|
$
|
62,814
|
|
Gross Property Additions (in millions)
|
$
|
7,624
|
|
|
$
|
6,169
|
|
|
$
|
6,522
|
|
|
$
|
5,868
|
|
|
$
|
5,059
|
|
Return on Average Common Equity (percent)
|
10.80
|
|
|
11.68
|
|
|
10.08
|
|
|
8.82
|
|
|
13.10
|
|
|||||
Cash Dividends Paid Per Share of
Common Stock
|
$
|
2.2225
|
|
|
$
|
2.1525
|
|
|
$
|
2.0825
|
|
|
$
|
2.0125
|
|
|
$
|
1.9425
|
|
Consolidated Net Income Attributable to
Southern Company (in millions)
|
$
|
2,448
|
|
|
$
|
2,367
|
|
|
$
|
1,963
|
|
|
$
|
1,644
|
|
|
$
|
2,350
|
|
Earnings Per Share —
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
2.57
|
|
|
$
|
2.60
|
|
|
$
|
2.19
|
|
|
$
|
1.88
|
|
|
$
|
2.70
|
|
Diluted
|
2.55
|
|
|
2.59
|
|
|
2.18
|
|
|
1.87
|
|
|
2.67
|
|
|||||
Capitalization (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
$
|
24,758
|
|
|
$
|
20,592
|
|
|
$
|
19,949
|
|
|
$
|
19,008
|
|
|
$
|
18,297
|
|
Preferred and preference stock of subsidiaries and
noncontrolling interests
|
1,854
|
|
|
1,390
|
|
|
977
|
|
|
756
|
|
|
707
|
|
|||||
Redeemable preferred stock of subsidiaries
|
118
|
|
|
118
|
|
|
375
|
|
|
375
|
|
|
375
|
|
|||||
Redeemable noncontrolling interests
|
164
|
|
|
43
|
|
|
39
|
|
|
—
|
|
|
—
|
|
|||||
Long-term debt
(b)
|
42,629
|
|
|
24,688
|
|
|
20,644
|
|
|
21,205
|
|
|
19,143
|
|
|||||
Total (excluding amounts due within one year)
|
$
|
69,523
|
|
|
$
|
46,831
|
|
|
$
|
41,984
|
|
|
$
|
41,344
|
|
|
$
|
38,522
|
|
Capitalization Ratios (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
35.6
|
|
|
44.0
|
|
|
47.5
|
|
|
46.0
|
|
|
47.5
|
|
|||||
Preferred and preference stock of subsidiaries and
noncontrolling interests
|
2.7
|
|
|
3.0
|
|
|
2.3
|
|
|
1.8
|
|
|
1.8
|
|
|||||
Redeemable preferred stock of subsidiaries
|
0.2
|
|
|
0.3
|
|
|
0.9
|
|
|
0.9
|
|
|
1.0
|
|
|||||
Redeemable noncontrolling interests
|
0.2
|
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|||||
Long-term debt
(b)
|
61.3
|
|
|
52.6
|
|
|
49.2
|
|
|
51.3
|
|
|
49.7
|
|
|||||
Total (excluding amounts due within one year)
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|||||
Other Common Stock Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Book value per share
|
$
|
25.00
|
|
|
$
|
22.59
|
|
|
$
|
21.98
|
|
|
$
|
21.43
|
|
|
$
|
21.09
|
|
Market price per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
High
|
$
|
54.64
|
|
|
$
|
53.16
|
|
|
$
|
51.28
|
|
|
$
|
48.74
|
|
|
$
|
48.59
|
|
Low
|
46.00
|
|
|
41.40
|
|
|
40.27
|
|
|
40.03
|
|
|
41.75
|
|
|||||
Close (year-end)
|
49.19
|
|
|
46.79
|
|
|
49.11
|
|
|
41.11
|
|
|
42.81
|
|
|||||
Market-to-book ratio (year-end) (percent)
|
196.8
|
|
|
207.2
|
|
|
223.4
|
|
|
191.8
|
|
|
203.0
|
|
|||||
Price-earnings ratio (year-end) (times)
|
19.1
|
|
|
18.0
|
|
|
22.4
|
|
|
21.9
|
|
|
15.9
|
|
|||||
Dividends paid (in millions)
|
$
|
2,104
|
|
|
$
|
1,959
|
|
|
$
|
1,866
|
|
|
$
|
1,762
|
|
|
$
|
1,693
|
|
Dividend yield (year-end) (percent)
|
4.5
|
|
|
4.6
|
|
|
4.2
|
|
|
4.9
|
|
|
4.5
|
|
|||||
Dividend payout ratio (percent)
|
86.0
|
|
|
82.7
|
|
|
95.0
|
|
|
107.1
|
|
|
72.0
|
|
|||||
Shares outstanding (in thousands):
|
|
|
|
|
|
|
|
|
|
||||||||||
Average
|
951,332
|
|
|
910,024
|
|
|
897,194
|
|
|
876,755
|
|
|
871,388
|
|
|||||
Year-end
|
990,394
|
|
|
911,721
|
|
|
907,777
|
|
|
887,086
|
|
|
867,768
|
|
|||||
Stockholders of record (year-end)
|
126,338
|
|
|
131,771
|
|
|
137,369
|
|
|
143,800
|
|
|
149,628
|
|
(a)
|
The 2016 selected financial and operating data includes the operations of Southern Company Gas from the date of the Merger, July 1, 2016, through December 31, 2016. See Note 12 under "Merger with Southern Company Gas" for additional information.
|
(b)
|
A reclassification of debt issuance costs from Total Assets to Long-term debt of $202 million, $139 million, and $133 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
(c)
|
A reclassification of deferred tax assets from Total Assets of $488 million, $143 million, and $202 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
|
2016
(a)
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
$
|
6,614
|
|
|
$
|
6,383
|
|
|
$
|
6,499
|
|
|
$
|
6,011
|
|
|
$
|
5,891
|
|
Commercial
|
5,394
|
|
|
5,317
|
|
|
5,469
|
|
|
5,214
|
|
|
5,097
|
|
|||||
Industrial
|
3,171
|
|
|
3,172
|
|
|
3,449
|
|
|
3,188
|
|
|
3,071
|
|
|||||
Other
|
55
|
|
|
115
|
|
|
133
|
|
|
128
|
|
|
128
|
|
|||||
Total retail
|
15,234
|
|
|
14,987
|
|
|
15,550
|
|
|
14,541
|
|
|
14,187
|
|
|||||
Wholesale
|
1,926
|
|
|
1,798
|
|
|
2,184
|
|
|
1,855
|
|
|
1,675
|
|
|||||
Total revenues from sales of electricity
|
17,160
|
|
|
16,785
|
|
|
17,734
|
|
|
16,396
|
|
|
15,862
|
|
|||||
Natural gas revenues
|
1,596
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other revenues
|
1,140
|
|
|
704
|
|
|
733
|
|
|
691
|
|
|
675
|
|
|||||
Total
|
$
|
19,896
|
|
|
$
|
17,489
|
|
|
$
|
18,467
|
|
|
$
|
17,087
|
|
|
$
|
16,537
|
|
Kilowatt-Hour Sales (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
53,337
|
|
|
52,121
|
|
|
53,347
|
|
|
50,575
|
|
|
50,454
|
|
|||||
Commercial
|
53,733
|
|
|
53,525
|
|
|
53,243
|
|
|
52,551
|
|
|
53,007
|
|
|||||
Industrial
|
52,792
|
|
|
53,941
|
|
|
54,140
|
|
|
52,429
|
|
|
51,674
|
|
|||||
Other
|
883
|
|
|
897
|
|
|
909
|
|
|
902
|
|
|
919
|
|
|||||
Total retail
|
160,745
|
|
|
160,484
|
|
|
161,639
|
|
|
156,457
|
|
|
156,054
|
|
|||||
Wholesale sales
|
34,896
|
|
|
30,505
|
|
|
32,786
|
|
|
26,944
|
|
|
27,563
|
|
|||||
Total
|
195,641
|
|
|
190,989
|
|
|
194,425
|
|
|
183,401
|
|
|
183,617
|
|
|||||
Average Revenue Per Kilowatt-Hour (cents):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
12.40
|
|
|
12.25
|
|
|
12.18
|
|
|
11.89
|
|
|
11.68
|
|
|||||
Commercial
|
10.04
|
|
|
9.93
|
|
|
10.27
|
|
|
9.92
|
|
|
9.62
|
|
|||||
Industrial
|
6.01
|
|
|
5.88
|
|
|
6.37
|
|
|
6.08
|
|
|
5.94
|
|
|||||
Total retail
|
9.48
|
|
|
9.34
|
|
|
9.62
|
|
|
9.29
|
|
|
9.09
|
|
|||||
Wholesale
|
5.52
|
|
|
5.89
|
|
|
6.66
|
|
|
6.88
|
|
|
6.08
|
|
|||||
Total sales
|
8.77
|
|
|
8.79
|
|
|
9.12
|
|
|
8.94
|
|
|
8.64
|
|
|||||
Average Annual Kilowatt-Hour
|
|
|
|
|
|
|
|
|
|
||||||||||
Use Per Residential Customer
|
12,387
|
|
|
13,318
|
|
|
13,765
|
|
|
13,144
|
|
|
13,187
|
|
|||||
Average Annual Revenue
|
|
|
|
|
|
|
|
|
|
||||||||||
Per Residential Customer
|
$
|
1,541
|
|
|
$
|
1,630
|
|
|
$
|
1,679
|
|
|
$
|
1,562
|
|
|
$
|
1,540
|
|
Plant Nameplate Capacity
|
|
|
|
|
|
|
|
|
|
||||||||||
Ratings (year-end) (megawatts)
|
46,291
|
|
|
44,223
|
|
|
46,549
|
|
|
45,502
|
|
|
45,740
|
|
|||||
Maximum Peak-Hour Demand (megawatts):
|
|
|
|
|
|
|
|
|
|
||||||||||
Winter
|
32,272
|
|
|
36,794
|
|
|
37,234
|
|
|
27,555
|
|
|
31,705
|
|
|||||
Summer
|
35,781
|
|
|
36,195
|
|
|
35,396
|
|
|
33,557
|
|
|
35,479
|
|
|||||
System Reserve Margin (at peak) (percent)
(b)
|
34.2
|
|
|
33.2
|
|
|
19.8
|
|
|
21.5
|
|
|
20.8
|
|
|||||
Annual Load Factor (percent)
|
61.5
|
|
|
59.9
|
|
|
59.6
|
|
|
63.2
|
|
|
59.5
|
|
|||||
Plant Availability (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Fossil-steam
|
86.4
|
|
|
86.1
|
|
|
85.8
|
|
|
87.7
|
|
|
89.4
|
|
|||||
Nuclear
|
93.3
|
|
|
93.5
|
|
|
91.5
|
|
|
91.5
|
|
|
94.2
|
|
(a)
|
The 2016 selected financial and operating data includes the operations of Southern Company Gas from the date of the Merger, July 1, 2016, through December 31, 2016. See Note 12 under "Merger with Southern Company Gas" for additional information.
|
(b)
|
Beginning in 2014, system reserve margin is calculated to include unrecognized capacity.
|
|
2016
(a)
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Source of Energy Supply (percent):
|
|
|
|
|
|
|
|
|
|
|||||
Coal
|
30.6
|
|
|
32.3
|
|
|
39.3
|
|
|
36.9
|
|
|
35.2
|
|
Nuclear
|
14.7
|
|
|
15.2
|
|
|
14.8
|
|
|
15.5
|
|
|
16.2
|
|
Oil and gas
|
42.2
|
|
|
42.7
|
|
|
37.0
|
|
|
37.2
|
|
|
38.2
|
|
Hydro
|
2.1
|
|
|
2.6
|
|
|
2.5
|
|
|
3.9
|
|
|
1.7
|
|
Other renewables
|
2.4
|
|
|
0.8
|
|
|
0.4
|
|
|
0.1
|
|
|
0.1
|
|
Purchased power
|
8.0
|
|
|
6.4
|
|
|
6.0
|
|
|
6.4
|
|
|
8.6
|
|
Total
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
Gas Sales Volumes (mmBtu in millions):
|
|
|
|
|
|
|
|
|
|
|||||
Firm
|
296
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Interruptible
|
53
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
349
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Traditional Electric Operating Company
Customers (year-end) (in thousands):
|
|
|
|
|
|
|
|
|
|
|||||
Residential
|
3,970
|
|
|
3,928
|
|
|
3,890
|
|
|
3,859
|
|
|
3,832
|
|
Commercial
(b)
|
595
|
|
|
590
|
|
|
586
|
|
|
582
|
|
|
579
|
|
Industrial
(b)
|
17
|
|
|
17
|
|
|
17
|
|
|
17
|
|
|
17
|
|
Other
|
11
|
|
|
11
|
|
|
11
|
|
|
9
|
|
|
8
|
|
Total electric customers
|
4,593
|
|
|
4,546
|
|
|
4,504
|
|
|
4,467
|
|
|
4,436
|
|
Gas distribution operations customers
|
4,586
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total utility customers
|
9,179
|
|
|
4,546
|
|
|
4,504
|
|
|
4,467
|
|
|
4,436
|
|
Employees (year-end)
|
32,020
|
|
|
26,703
|
|
|
26,369
|
|
|
26,300
|
|
|
26,439
|
|
(a)
|
The 2016 selected financial and operating data includes the operations of Southern Company Gas from the date of the Merger, July 1, 2016, through December 31, 2016. See Note 12 under "Merger with Southern Company Gas" for additional information.
|
(b)
|
A reclassification of customers from commercial to industrial is reflected for years 2012-2015 to be consistent with the rate structure approved by the Georgia PSC. The impact to operating revenues, kilowatt-hour sales, and average revenue per kilowatt-hour by class is not material.
|
Term
|
Meaning
|
AFUDC
|
Allowance for funds used during construction
|
ARO
|
Asset retirement obligation
|
ASC
|
Accounting Standards Codification
|
ASU
|
Accounting Standards Update
|
CCR
|
Coal combustion residuals
|
Clean Air Act
|
Clean Air Act Amendments of 1990
|
CO
2
|
Carbon dioxide
|
DOE
|
U.S. Department of Energy
|
EPA
|
U.S. Environmental Protection Agency
|
FASB
|
Financial Accounting Standards Board
|
FERC
|
Federal Energy Regulatory Commission
|
GAAP
|
U.S. generally accepted accounting principles
|
Georgia Power
|
Georgia Power Company
|
Gulf Power
|
Gulf Power Company
|
IRS
|
Internal Revenue Service
|
ITC
|
Investment tax credit
|
KWH
|
Kilowatt-hour
|
LIBOR
|
London Interbank Offered Rate
|
Mississippi Power
|
Mississippi Power Company
|
mmBtu
|
Million British thermal units
|
Moody's
|
Moody's Investors Service, Inc.
|
MW
|
Megawatt
|
NDR
|
Natural Disaster Reserve
|
NRC
|
U.S. Nuclear Regulatory Commission
|
OCI
|
Other comprehensive income
|
power pool
|
The operating arrangement whereby the integrated generating resources of the traditional electric operating companies and Southern Power (excluding subsidiaries) are subject to joint commitment and dispatch in order to serve their combined load obligations
|
PPA
|
Power purchase agreement
|
PSC
|
Public Service Commission
|
Rate CNP
|
Rate Certificated New Plant
|
Rate CNP Compliance
|
Rate Certificated New Plant Compliance
|
Rate CNP PPA
|
Rate Certificated New Plant Power Purchase Agreement
|
Rate ECR
|
Rate Energy Cost Recovery
|
Rate NDR
|
Rate Natural Disaster Reserve
|
Rate RSE
|
Rate Stabilization and Equalization plan
|
ROE
|
Return on equity
|
S&P
|
S&P Global Ratings, a division of S&P Global Inc.
|
SCS
|
Southern Company Services, Inc. (the Southern Company system service company)
|
SEC
|
U.S. Securities and Exchange Commission
|
SEGCO
|
Southern Electric Generating Company
|
Southern Company
|
The Southern Company
|
Southern Company Gas
|
Southern Company Gas (formerly known as AGL Resources Inc.) and its subsidiaries
|
Term
|
Meaning
|
Southern Company system
|
Southern Company, the traditional electric operating companies, Southern Power, Southern Company Gas (as of July 1, 2016), SEGCO, Southern Nuclear, SCS, Southern LINC, PowerSecure, Inc. (as of May 9, 2016), and other subsidiaries
|
Southern LINC
|
Southern Communications Services, Inc.
|
Southern Nuclear
|
Southern Nuclear Operating Company, Inc.
|
Southern Power
|
Southern Power Company and its subsidiaries
|
traditional electric operating companies
|
Alabama Power Company, Georgia Power, Gulf Power, and Mississippi Power
|
|
Amount
|
|
Increase (Decrease)
from Prior Year
|
||||||||
|
2016
|
|
2016
|
|
2015
|
||||||
|
(in millions)
|
||||||||||
Operating revenues
|
$
|
5,889
|
|
|
$
|
121
|
|
|
$
|
(174
|
)
|
Fuel
|
1,297
|
|
|
(45
|
)
|
|
(263
|
)
|
|||
Purchased power
|
334
|
|
|
(17
|
)
|
|
(34
|
)
|
|||
Other operations and maintenance
|
1,510
|
|
|
9
|
|
|
33
|
|
|||
Depreciation and amortization
|
703
|
|
|
60
|
|
|
40
|
|
|||
Taxes other than income taxes
|
380
|
|
|
12
|
|
|
12
|
|
|||
Total operating expenses
|
4,224
|
|
|
19
|
|
|
(212
|
)
|
|||
Operating income
|
1,665
|
|
|
102
|
|
|
38
|
|
|||
Allowance for equity funds used during construction
|
28
|
|
|
(32
|
)
|
|
11
|
|
|||
Interest income
|
16
|
|
|
1
|
|
|
—
|
|
|||
Interest expense, net of amounts capitalized
|
302
|
|
|
28
|
|
|
19
|
|
|||
Other income (expense), net
|
(37
|
)
|
|
10
|
|
|
(25
|
)
|
|||
Income taxes
|
531
|
|
|
25
|
|
|
(6
|
)
|
|||
Net income
|
839
|
|
|
28
|
|
|
11
|
|
|||
Dividends on preferred and preference stock
|
17
|
|
|
(9
|
)
|
|
(13
|
)
|
|||
Net income after dividends on preferred and preference stock
|
$
|
822
|
|
|
$
|
37
|
|
|
$
|
24
|
|
|
Amount
|
||||||
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Retail — prior year
|
$
|
5,234
|
|
|
$
|
5,249
|
|
Estimated change resulting from —
|
|
|
|
||||
Rates and pricing
|
147
|
|
|
204
|
|
||
Sales decline
|
(20
|
)
|
|
(11
|
)
|
||
Weather
|
31
|
|
|
(43
|
)
|
||
Fuel and other cost recovery
|
(70
|
)
|
|
(165
|
)
|
||
Retail — current year
|
5,322
|
|
|
5,234
|
|
||
Wholesale revenues —
|
|
|
|
||||
Non-affiliates
|
283
|
|
|
241
|
|
||
Affiliates
|
69
|
|
|
84
|
|
||
Total wholesale revenues
|
352
|
|
|
325
|
|
||
Other operating revenues
|
215
|
|
|
209
|
|
||
Total operating revenues
|
$
|
5,889
|
|
|
$
|
5,768
|
|
Percent change
|
2.1
|
%
|
|
(2.9
|
)%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Capacity and other
|
$
|
154
|
|
|
$
|
140
|
|
|
$
|
154
|
|
Energy
|
129
|
|
|
101
|
|
|
127
|
|
|||
Total non-affiliated
|
$
|
283
|
|
|
$
|
241
|
|
|
$
|
281
|
|
|
Total
KWHs
|
|
Total KWH
Percent Change
|
|
Weather-Adjusted
Percent Change
|
|||||||||
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||
|
(in billions)
|
|
|
|
|
|
|
|
|
|||||
Residential
|
18.4
|
|
|
1.4
|
%
|
|
(3.4
|
)%
|
|
(0.5
|
)%
|
|
0.1
|
%
|
Commercial
|
14.1
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(0.5
|
)
|
|
0.1
|
|
Industrial
|
22.3
|
|
|
(4.6
|
)
|
|
(1.8
|
)
|
|
(4.6
|
)
|
|
(1.8
|
)
|
Other
|
0.2
|
|
|
3.8
|
|
|
(4.9
|
)
|
|
3.8
|
|
|
(4.9
|
)
|
Total retail
|
55.0
|
|
|
(1.5
|
)
|
|
(1.9
|
)
|
|
(2.2
|
)%
|
|
(0.7
|
)%
|
Wholesale
|
|
|
|
|
|
|
|
|
|
|||||
Non-affiliates
|
5.9
|
|
|
37.1
|
|
|
(6.3
|
)
|
|
|
|
|
||
Affiliates
|
3.2
|
|
|
(15.7
|
)
|
|
(33.8
|
)
|
|
|
|
|
||
Total wholesale
|
9.1
|
|
|
12.5
|
|
|
(21.5
|
)
|
|
|
|
|
||
Total energy sales
|
64.1
|
|
|
0.3
|
%
|
|
(4.9
|
)%
|
|
|
|
|
|
2016
|
|
2015
|
|
2014
|
|||
Total generation
(in billions of KWHs)
|
60.2
|
|
|
60.9
|
|
|
63.6
|
|
Total purchased power
(in billions of KWHs)
|
7.1
|
|
|
6.3
|
|
|
6.6
|
|
Sources of generation
(percent)
—
|
|
|
|
|
|
|||
Coal
|
53
|
|
|
54
|
|
|
54
|
|
Nuclear
|
23
|
|
|
24
|
|
|
23
|
|
Gas
|
19
|
|
|
16
|
|
|
17
|
|
Hydro
|
5
|
|
|
6
|
|
|
6
|
|
Cost of fuel, generated
(in cents per net KWH)
—
|
|
|
|
|
|
|||
Coal
|
2.75
|
|
|
2.83
|
|
|
3.14
|
|
Nuclear
|
0.78
|
|
|
0.81
|
|
|
0.84
|
|
Gas
|
2.67
|
|
|
2.94
|
|
|
3.69
|
|
Average cost of fuel, generated
(in cents per net KWH)
(a)
|
2.26
|
|
|
2.34
|
|
|
2.68
|
|
Average cost of purchased power
(in cents per net KWH)
(b)
|
4.80
|
|
|
5.66
|
|
|
5.92
|
|
(a)
|
KWHs generated by hydro are excluded from the average cost of fuel, generated.
|
(b)
|
Average cost of purchased power includes fuel, energy, and transmission purchased by the Company for tolling agreements where power is generated by the provider.
|
Expires
|
|
|
|
|
|
Expires Within One Year
|
||||||||||||||||||||
2017
|
|
2018
|
|
2020
|
|
Total
|
|
Unused
|
|
Term Out
|
|
No Term Out
|
||||||||||||||
(in millions)
|
|
(in millions)
|
|
(in millions)
|
||||||||||||||||||||||
$
|
35
|
|
|
$
|
500
|
|
|
$
|
800
|
|
|
$
|
1,335
|
|
|
$
|
1,335
|
|
|
$
|
—
|
|
|
$
|
35
|
|
|
Short-term Debt During the Period
(*)
|
|||||||||
|
Average
Amount Outstanding
|
|
Weighted
Average
Interest
Rate
|
|
Maximum
Amount
Outstanding
|
|||||
|
(in millions)
|
|
|
|
(in millions)
|
|||||
|
|
|
|
|
|
|||||
December 31, 2016
|
$
|
16
|
|
|
0.6
|
%
|
|
$
|
200
|
|
December 31, 2015
|
$
|
14
|
|
|
0.2
|
%
|
|
$
|
100
|
|
December 31, 2014
|
$
|
13
|
|
|
0.2
|
%
|
|
$
|
300
|
|
(*)
|
Average and maximum amounts are based upon daily balances during the twelve-month periods ended December 31, 2016, 2015, and 2014.
|
Credit Ratings
|
Maximum Potential
Collateral
Requirements
|
||
|
(in millions)
|
||
At BBB and/or Baa2
|
$
|
1
|
|
At BBB- and/or Baa3
|
$
|
2
|
|
Below BBB- and/or Baa3
|
$
|
332
|
|
|
2016
Changes
|
|
2015
Changes
|
||||
|
Fair Value
|
||||||
|
(in millions)
|
||||||
Contracts outstanding at the beginning of the period, assets (liabilities), net
|
$
|
(54
|
)
|
|
$
|
(52
|
)
|
Contracts realized or settled
|
39
|
|
|
41
|
|
||
Current period changes
(*)
|
27
|
|
|
(43
|
)
|
||
Contracts outstanding at the end of the period, assets (liabilities), net
|
$
|
12
|
|
|
$
|
(54
|
)
|
(*)
|
Current period changes also include the changes in fair value of new contracts entered into during the period, if any.
|
|
2016
|
|
2015
|
||
|
mmBtu Volume
|
||||
|
(in millions)
|
||||
Commodity – Natural gas swaps
|
68
|
|
|
44
|
|
Commodity – Natural gas options
|
6
|
|
|
6
|
|
Total hedge volume
|
74
|
|
|
50
|
|
|
|
|
Fair Value Measurements
|
||||||||
|
|
|
December 31, 2016
|
||||||||
|
Total
|
|
Maturity
|
||||||||
|
Fair Value
|
|
Year 1
|
|
Years 2&3
|
||||||
|
(in millions)
|
||||||||||
Level 1
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Level 2
|
12
|
|
|
8
|
|
|
4
|
|
|||
Level 3
|
—
|
|
|
—
|
|
|
—
|
|
|||
Fair value of contracts outstanding at end of period
|
$
|
12
|
|
|
$
|
8
|
|
|
$
|
4
|
|
|
2017
|
|
2018-
2019
|
|
2020-
2021
|
|
After
2021
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Long-term debt
(a)
—
|
|
|
|
|
|
|
|
|
|
||||||||||
Principal
|
$
|
561
|
|
|
$
|
200
|
|
|
$
|
560
|
|
|
$
|
5,827
|
|
|
$
|
7,148
|
|
Interest
|
290
|
|
|
521
|
|
|
492
|
|
|
4,013
|
|
|
5,316
|
|
|||||
Preferred and preference stock dividends
(b)
|
17
|
|
|
35
|
|
|
35
|
|
|
—
|
|
|
87
|
|
|||||
Financial derivative obligations
(c)
|
5
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|||||
Operating leases
(d)
|
14
|
|
|
20
|
|
|
16
|
|
|
10
|
|
|
60
|
|
|||||
Capital Lease
|
1
|
|
|
1
|
|
|
1
|
|
|
3
|
|
|
6
|
|
|||||
Purchase commitments —
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital
(e)
|
1,782
|
|
|
2,554
|
|
|
2,185
|
|
|
—
|
|
|
6,521
|
|
|||||
Fuel
(f)
|
1,069
|
|
|
1,404
|
|
|
631
|
|
|
355
|
|
|
3,459
|
|
|||||
Purchased power
(g)
|
81
|
|
|
174
|
|
|
189
|
|
|
722
|
|
|
1,166
|
|
|||||
Other
(h)
|
44
|
|
|
86
|
|
|
52
|
|
|
274
|
|
|
456
|
|
|||||
Pension and other postretirement benefit plans
(i)
|
19
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
57
|
|
|||||
Total
|
$
|
3,883
|
|
|
$
|
5,037
|
|
|
$
|
4,161
|
|
|
$
|
11,204
|
|
|
$
|
24,285
|
|
(a)
|
All amounts are reflected based on final maturity dates. The Company plans to continue, when economically feasible, to retire higher-cost securities and replace these obligations with lower-cost capital if market conditions permit. Variable rate interest obligations are estimated based on rates as of January 1, 2017, as reflected in the statements of capitalization. Fixed rates include, where applicable, the effects of interest rate derivatives employed to manage interest rate risk.
|
(b)
|
Preferred and preference stock do not mature; therefore, amounts are provided for the next five years only.
|
(c)
|
Includes derivative liabilities related to cash flow hedges of forecasted debt, as well as energy-related derivatives. For additional information, see Notes 1 and 11 to the financial statements.
|
(d)
|
Excludes PPAs that are accounted for as leases and are included in purchased power.
|
(e)
|
The Company provides estimated capital expenditures for a five-year period, including capital expenditures associated with environmental regulations. These amounts exclude contractual purchase commitments for nuclear fuel and capital expenditures covered under long-term service agreements which are reflected in "Fuel" and "Other," respectively. At
December 31, 2016
, purchase commitments were outstanding in connection with the construction program. See FUTURE EARNINGS POTENTIAL – "Environmental Matters – Environmental Statutes and Regulations" herein for additional information.
|
(f)
|
Includes commitments to purchase coal, nuclear fuel, and natural gas, as well as the related transportation and storage. In most cases, these contracts contain provisions for price escalation, minimum purchase levels, and other financial commitments. Natural gas purchase commitments are based on various indices at the time of delivery. Amounts reflected for natural gas purchase commitments have been estimated based on the New York Mercantile Exchange future prices at December 31, 2016.
|
(g)
|
Estimated minimum long-term obligations for various long-term commitments for the purchase of capacity and energy. Amounts are related to the Company's certificated PPAs which include MWs purchased from gas-fired and wind-powered facilities.
|
(h)
|
Includes long-term service agreements and contracts for the procurement of limestone. Long-term service agreements include price escalation based on inflation indices.
|
(i)
|
The Company forecasts contributions to the pension and other postretirement benefit plans over a three-year period. The Company anticipates no mandatory contributions to the qualified pension plan during the next three years. Amounts presented represent estimated benefit payments for the nonqualified pension plans, estimated non-trust benefit payments for the other postretirement benefit plans, and estimated contributions to the other postretirement benefit plan trusts, all of which will be made from the Company's corporate assets. See Note 2 to the financial statements for additional information related to the pension and other postretirement benefit plans, including estimated benefit payments. Certain benefit payments will be made through the related benefit plans. Other benefit payments will be made from the Company's corporate assets.
|
•
|
the impact of recent and future federal and state regulatory changes, including environmental laws regulating emissions, discharges, and disposal to air, water, and land
,
and also changes in tax and other laws and regulations to which
the Company is
subject, including potential tax reform legislation, as well as changes in application of existing laws and regulations;
|
•
|
current and future litigation, regulatory investigations, proceedings, or inquiries
;
|
•
|
the effects, extent, and timing of the entry of additional competition in the markets in which
the Company operates;
|
•
|
variations in demand for
electricity,
including those relating to weather, the general economy and recovery from the last recession, population and business growth (and declines), the effects of energy conservation and efficiency measures, including from the development and deployment of alternative energy sources such as self-generation and distributed generation technologies, and any potential economic impacts resulting from federal fiscal decisions;
|
•
|
available sources and costs of
fuels;
|
•
|
effects of inflation;
|
•
|
the ability to control costs and avoid cost overruns during the development
and construction of facilities,
to construct facilities in accordance with the requirements of permits and licenses,
and
to satisfy any environmental performance standards
;
|
•
|
investment performance of
the Company's
employee and retiree benefit plans
and
nuclear decommissioning trust funds;
|
•
|
advances in technology;
|
•
|
state and federal rate regulations
and the impact of pending and future rate cases and negotiations, including rate
actions relating
to fuel and other cost recovery mechanisms;
|
•
|
the inherent risks involved in operating
nuclear generating facilities, including environmental, health, regulatory, natural disaster, terrorism, and financial risks;
|
•
|
the ability to successfully operate generating, transmission, and distribution facilities and the successful performance of necessary corporate functions;
|
•
|
internal restructuring or other restructuring options that may be pursued;
|
•
|
potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to
the Company;
|
•
|
the ability of counterparties of
the Company
to make payments as and when due and to perform as required;
|
•
|
the ability to obtain new short- and long-term contracts with wholesale customers;
|
•
|
the direct or indirect effect on the
Company's
business resulting from cyber intrusion or terrorist incidents and the threat of terrorist incidents;
|
•
|
interest rate fluctuations and financial market conditions and the results of financing efforts;
|
•
|
changes in the Company's
credit ratings, including impacts on interest rates, access to capital markets, and collateral requirements;
|
•
|
the impacts of any sovereign financial issues, including impacts on interest rates, access to capital markets, impacts on foreign currency exchange rates, counterparty performance, and the economy in general
;
|
•
|
the ability of
the Company
to obtain additional generating capacity (or sell excess generating capacity) at competitive prices;
|
•
|
catastrophic events such as fires, earthquakes, explosions, floods, tornadoes,
hurricanes and other storms, droughts, pandemic health events such as influenzas, or other similar occurrences;
|
•
|
the direct or indirect effects on the
Company's
business resulting from incidents affecting the U.S. electric grid
or operation of generating
resources;
|
•
|
the effect of accounting pronouncements issued periodically by standard-setting bodies; and
|
•
|
other factors discussed elsewhere herein and in other reports (including the Form 10-K) filed by
the Company
from time to time with the SEC.
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
||||||
Retail revenues
|
$
|
5,322
|
|
|
$
|
5,234
|
|
|
$
|
5,249
|
|
Wholesale revenues, non-affiliates
|
283
|
|
|
241
|
|
|
281
|
|
|||
Wholesale revenues, affiliates
|
69
|
|
|
84
|
|
|
189
|
|
|||
Other revenues
|
215
|
|
|
209
|
|
|
223
|
|
|||
Total operating revenues
|
5,889
|
|
|
5,768
|
|
|
5,942
|
|
|||
Operating Expenses:
|
|
|
|
|
|
||||||
Fuel
|
1,297
|
|
|
1,342
|
|
|
1,605
|
|
|||
Purchased power, non-affiliates
|
166
|
|
|
171
|
|
|
185
|
|
|||
Purchased power, affiliates
|
168
|
|
|
180
|
|
|
200
|
|
|||
Other operations and maintenance
|
1,510
|
|
|
1,501
|
|
|
1,468
|
|
|||
Depreciation and amortization
|
703
|
|
|
643
|
|
|
603
|
|
|||
Taxes other than income taxes
|
380
|
|
|
368
|
|
|
356
|
|
|||
Total operating expenses
|
4,224
|
|
|
4,205
|
|
|
4,417
|
|
|||
Operating Income
|
1,665
|
|
|
1,563
|
|
|
1,525
|
|
|||
Other Income and (Expense):
|
|
|
|
|
|
||||||
Allowance for equity funds used during construction
|
28
|
|
|
60
|
|
|
49
|
|
|||
Interest expense, net of amounts capitalized
|
(302
|
)
|
|
(274
|
)
|
|
(255
|
)
|
|||
Other income (expense), net
|
(21
|
)
|
|
(32
|
)
|
|
(7
|
)
|
|||
Total other income and (expense)
|
(295
|
)
|
|
(246
|
)
|
|
(213
|
)
|
|||
Earnings Before Income Taxes
|
1,370
|
|
|
1,317
|
|
|
1,312
|
|
|||
Income taxes
|
531
|
|
|
506
|
|
|
512
|
|
|||
Net Income
|
839
|
|
|
811
|
|
|
800
|
|
|||
Dividends on Preferred and Preference Stock
|
17
|
|
|
26
|
|
|
39
|
|
|||
Net Income After Dividends on Preferred and Preference Stock
|
$
|
822
|
|
|
$
|
785
|
|
|
$
|
761
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Net Income
|
$
|
839
|
|
|
$
|
811
|
|
|
$
|
800
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Qualifying hedges:
|
|
|
|
|
|
||||||
Changes in fair value, net of tax of $(1), $(3), and $(3), respectively
|
(2
|
)
|
|
(5
|
)
|
|
(5
|
)
|
|||
Reclassification adjustment for amounts included in net income,
net of tax of $2, $1, and $1, respectively |
4
|
|
|
2
|
|
|
2
|
|
|||
Total other comprehensive income (loss)
|
2
|
|
|
(3
|
)
|
|
(3
|
)
|
|||
Comprehensive Income
|
$
|
841
|
|
|
$
|
808
|
|
|
$
|
797
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Operating Activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
839
|
|
|
$
|
811
|
|
|
$
|
800
|
|
Adjustments to reconcile net income
to net cash provided from operating activities — |
|
|
|
|
|
||||||
Depreciation and amortization, total
|
844
|
|
|
780
|
|
|
724
|
|
|||
Deferred income taxes
|
407
|
|
|
388
|
|
|
270
|
|
|||
Allowance for equity funds used during construction
|
(28
|
)
|
|
(60
|
)
|
|
(49
|
)
|
|||
Pension, postretirement, and other employee benefits
|
(27
|
)
|
|
20
|
|
|
(61
|
)
|
|||
Pension and postretirement funding
|
(133
|
)
|
|
—
|
|
|
—
|
|
|||
Other deferred charges – affiliated
|
(50
|
)
|
|
—
|
|
|
—
|
|
|||
Other, net
|
(25
|
)
|
|
(5
|
)
|
|
29
|
|
|||
Changes in certain current assets and liabilities —
|
|
|
|
|
|
||||||
-Receivables
|
94
|
|
|
(160
|
)
|
|
(58
|
)
|
|||
-Fossil fuel stock
|
34
|
|
|
28
|
|
|
61
|
|
|||
-Other current assets
|
(33
|
)
|
|
12
|
|
|
(29
|
)
|
|||
-Accounts payable
|
73
|
|
|
3
|
|
|
157
|
|
|||
-Accrued taxes
|
93
|
|
|
138
|
|
|
(199
|
)
|
|||
-Retail fuel cost over recovery
|
(162
|
)
|
|
191
|
|
|
5
|
|
|||
-Other current liabilities
|
23
|
|
|
(4
|
)
|
|
59
|
|
|||
Net cash provided from operating activities
|
1,949
|
|
|
2,142
|
|
|
1,709
|
|
|||
Investing Activities:
|
|
|
|
|
|
||||||
Property additions
|
(1,272
|
)
|
|
(1,367
|
)
|
|
(1,457
|
)
|
|||
Nuclear decommissioning trust fund purchases
|
(352
|
)
|
|
(439
|
)
|
|
(245
|
)
|
|||
Nuclear decommissioning trust fund sales
|
351
|
|
|
438
|
|
|
244
|
|
|||
Cost of removal net of salvage
|
(94
|
)
|
|
(71
|
)
|
|
(77
|
)
|
|||
Change in construction payables
|
(37
|
)
|
|
(15
|
)
|
|
(10
|
)
|
|||
Other investing activities
|
(34
|
)
|
|
(34
|
)
|
|
(22
|
)
|
|||
Net cash used for investing activities
|
(1,438
|
)
|
|
(1,488
|
)
|
|
(1,567
|
)
|
|||
Financing Activities:
|
|
|
|
|
|
||||||
Proceeds —
|
|
|
|
|
|
||||||
Senior notes
|
400
|
|
|
975
|
|
|
400
|
|
|||
Pollution control revenue bonds
|
—
|
|
|
80
|
|
|
254
|
|
|||
Other long-term debt
|
45
|
|
|
—
|
|
|
—
|
|
|||
Capital contributions from parent company
|
260
|
|
|
22
|
|
|
28
|
|
|||
Redemptions and repurchases —
|
|
|
|
|
|
||||||
Senior notes
|
(200
|
)
|
|
(650
|
)
|
|
—
|
|
|||
Preferred and preference stock
|
—
|
|
|
(412
|
)
|
|
—
|
|
|||
Pollution control revenue bonds
|
—
|
|
|
(134
|
)
|
|
(254
|
)
|
|||
Payment of common stock dividends
|
(765
|
)
|
|
(571
|
)
|
|
(550
|
)
|
|||
Other financing activities
|
(25
|
)
|
|
(43
|
)
|
|
(42
|
)
|
|||
Net cash used for financing activities
|
(285
|
)
|
|
(733
|
)
|
|
(164
|
)
|
|||
Net Change in Cash and Cash Equivalents
|
226
|
|
|
(79
|
)
|
|
(22
|
)
|
|||
Cash and Cash Equivalents at Beginning of Year
|
194
|
|
|
273
|
|
|
295
|
|
|||
Cash and Cash Equivalents at End of Year
|
$
|
420
|
|
|
$
|
194
|
|
|
$
|
273
|
|
Supplemental Cash Flow Information:
|
|
|
|
|
|
||||||
Cash paid (received) during the period for —
|
|
|
|
|
|
||||||
Interest (net of $11, $22, and $18 capitalized, respectively)
|
$
|
277
|
|
|
$
|
250
|
|
|
$
|
231
|
|
Income taxes (net of refunds)
|
(108
|
)
|
|
121
|
|
|
436
|
|
|||
Noncash transactions — accrued property additions at year-end
|
84
|
|
|
121
|
|
|
8
|
|
Assets
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
420
|
|
|
$
|
194
|
|
Receivables —
|
|
|
|
||||
Customer accounts receivable
|
348
|
|
|
375
|
|
||
Unbilled revenues
|
146
|
|
|
119
|
|
||
Income taxes receivable, current
|
—
|
|
|
142
|
|
||
Other accounts and notes receivable
|
27
|
|
|
20
|
|
||
Affiliated
|
40
|
|
|
50
|
|
||
Accumulated provision for uncollectible accounts
|
(10
|
)
|
|
(10
|
)
|
||
Fossil fuel stock
|
205
|
|
|
239
|
|
||
Materials and supplies
|
435
|
|
|
398
|
|
||
Prepaid expenses
|
34
|
|
|
83
|
|
||
Other regulatory assets, current
|
149
|
|
|
182
|
|
||
Other current assets
|
11
|
|
|
9
|
|
||
Total current assets
|
1,805
|
|
|
1,801
|
|
||
Property, Plant, and Equipment:
|
|
|
|
||||
In service
|
26,031
|
|
|
24,750
|
|
||
Less accumulated provision for depreciation
|
9,112
|
|
|
8,736
|
|
||
Plant in service, net of depreciation
|
16,919
|
|
|
16,014
|
|
||
Nuclear fuel, at amortized cost
|
336
|
|
|
363
|
|
||
Construction work in progress
|
491
|
|
|
801
|
|
||
Total property, plant, and equipment
|
17,746
|
|
|
17,178
|
|
||
Other Property and Investments:
|
|
|
|
||||
Equity investments in unconsolidated subsidiaries
|
66
|
|
|
71
|
|
||
Nuclear decommissioning trusts, at fair value
|
792
|
|
|
737
|
|
||
Miscellaneous property and investments
|
112
|
|
|
96
|
|
||
Total other property and investments
|
970
|
|
|
904
|
|
||
Deferred Charges and Other Assets:
|
|
|
|
||||
Deferred charges related to income taxes
|
525
|
|
|
522
|
|
||
Deferred under recovered regulatory clause revenues
|
150
|
|
|
99
|
|
||
Other regulatory assets, deferred
|
1,157
|
|
|
1,114
|
|
||
Other deferred charges and assets
|
163
|
|
|
103
|
|
||
Total deferred charges and other assets
|
1,995
|
|
|
1,838
|
|
||
Total Assets
|
$
|
22,516
|
|
|
$
|
21,721
|
|
Liabilities and Stockholder's Equity
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
||||
Securities due within one year
|
$
|
561
|
|
|
$
|
200
|
|
Accounts payable —
|
|
|
|
||||
Affiliated
|
297
|
|
|
278
|
|
||
Other
|
433
|
|
|
410
|
|
||
Customer deposits
|
88
|
|
|
88
|
|
||
Accrued taxes —
|
|
|
|
||||
Accrued income taxes
|
45
|
|
|
—
|
|
||
Other accrued taxes
|
42
|
|
|
38
|
|
||
Accrued interest
|
78
|
|
|
73
|
|
||
Accrued compensation
|
193
|
|
|
175
|
|
||
Other regulatory liabilities, current
|
85
|
|
|
240
|
|
||
Other current liabilities
|
76
|
|
|
93
|
|
||
Total current liabilities
|
1,898
|
|
|
1,595
|
|
||
Long-Term Debt
(See accompanying statements)
|
6,535
|
|
|
6,654
|
|
||
Deferred Credits and Other Liabilities:
|
|
|
|
||||
Accumulated deferred income taxes
|
4,654
|
|
|
4,241
|
|
||
Deferred credits related to income taxes
|
65
|
|
|
70
|
|
||
Accumulated deferred investment tax credits
|
110
|
|
|
118
|
|
||
Employee benefit obligations
|
300
|
|
|
388
|
|
||
Asset retirement obligations
|
1,503
|
|
|
1,448
|
|
||
Other cost of removal obligations
|
684
|
|
|
722
|
|
||
Other regulatory liabilities, deferred
|
100
|
|
|
136
|
|
||
Other deferred credits and liabilities
|
63
|
|
|
76
|
|
||
Total deferred credits and other liabilities
|
7,479
|
|
|
7,199
|
|
||
Total Liabilities
|
15,912
|
|
|
15,448
|
|
||
Redeemable Preferred Stock
(See accompanying statements)
|
85
|
|
|
85
|
|
||
Preference Stock
(See accompanying statements)
|
196
|
|
|
196
|
|
||
Common Stockholder's Equity
(See accompanying statements)
|
6,323
|
|
|
5,992
|
|
||
Total Liabilities and Stockholder's Equity
|
$
|
22,516
|
|
|
$
|
21,721
|
|
Commitments and Contingent Matters
(See notes)
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
|
(percent of total)
|
||||||||||
Long-Term Debt:
|
|
|
|
|
|
|
|
||||||
Long-term debt payable to affiliated trusts —
|
|
|
|
|
|
|
|
||||||
Variable rate (3.95% at 1/1/17) due 2042
|
$
|
206
|
|
|
$
|
206
|
|
|
|
|
|
||
Long-term notes payable —
|
|
|
|
|
|
|
|
||||||
5.20% due 2016
|
—
|
|
|
200
|
|
|
|
|
|
||||
5.50% to 5.55% due 2017
|
525
|
|
|
525
|
|
|
|
|
|
||||
5.125% due 2019
|
200
|
|
|
200
|
|
|
|
|
|
||||
3.375% due 2020
|
250
|
|
|
250
|
|
|
|
|
|
||||
2.38% to 3.95% due 2021
|
220
|
|
|
200
|
|
|
|
|
|
||||
2.80% to 6.125% due 2022-2046
|
4,625
|
|
|
4,225
|
|
|
|
|
|
||||
Variable rates (1.87% to 2.10% at 1/1/17) due 2021
|
25
|
|
|
—
|
|
|
|
|
|
||||
Total long-term notes payable
|
5,845
|
|
|
5,600
|
|
|
|
|
|
||||
Other long-term debt —
|
|
|
|
|
|
|
|
||||||
Pollution control revenue bonds —
|
|
|
|
|
|
|
|
||||||
0.65% to 1.65% due 2034
|
207
|
|
|
287
|
|
|
|
|
|
||||
Variable rates (0.77% to 0.79% at 1/1/17) due 2017
|
36
|
|
|
36
|
|
|
|
|
|
||||
Variable rates (0.82% to 0.86% at 1/1/17) due 2021
|
65
|
|
|
65
|
|
|
|
|
|
||||
Variable rates (0.77% to 0.82% at 1/1/17) due 2024-2038
|
788
|
|
|
709
|
|
|
|
|
|
||||
Total other long-term debt
|
1,096
|
|
|
1,097
|
|
|
|
|
|
||||
Capitalized lease obligations
|
4
|
|
|
5
|
|
|
|
|
|
||||
Unamortized debt premium (discount), net
|
(9
|
)
|
|
(9
|
)
|
|
|
|
|
||||
Unamortized debt issuance expense
|
(46
|
)
|
|
(45
|
)
|
|
|
|
|
||||
Total long-term debt (annual interest requirement — $290 million)
|
7,096
|
|
|
6,854
|
|
|
|
|
|
||||
Less amount due within one year
|
561
|
|
|
200
|
|
|
|
|
|
||||
Long-term debt excluding amount due within one year
|
6,535
|
|
|
6,654
|
|
|
49.7
|
%
|
|
51.4
|
%
|
||
Redeemable Preferred Stock:
|
|
|
|
|
|
|
|
||||||
Cumulative redeemable preferred stock
|
|
|
|
|
|
|
|
||||||
$100 par or stated value — 4.20% to 4.92%
|
|
|
|
|
|
|
|
||||||
Authorized — 3,850,000 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — 475,115 shares
|
48
|
|
|
48
|
|
|
|
|
|
||||
$1 par value — 5.83%
|
|
|
|
|
|
|
|
||||||
Authorized — 27,500,000 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — 1,520,000 shares: $25 stated value
|
|
|
|
|
|
|
|
||||||
(annual dividend requirement — $4 million)
|
37
|
|
|
37
|
|
|
|
|
|
||||
Total redeemable preferred stock
|
85
|
|
|
85
|
|
|
0.7
|
|
|
0.7
|
|
||
Preference Stock:
|
|
|
|
|
|
|
|
||||||
Authorized — 40,000,000 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — $1 par value — 6.45% to 6.50%
|
|
|
|
|
|
|
|
||||||
— 8,000,000 shares (non-cumulative): $25 stated value
|
|
|
|
|
|
|
|
||||||
(annual dividend requirement — $13 million)
|
196
|
|
|
196
|
|
|
1.5
|
|
1.5
|
||||
Common Stockholder's Equity:
|
|
|
|
|
|
|
|
||||||
Common stock, par value $40 per share —
|
|
|
|
|
|
|
|
||||||
Authorized — 40,000,000 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — 30,537,500 shares
|
1,222
|
|
|
1,222
|
|
|
|
|
|
||||
Paid-in capital
|
2,613
|
|
|
2,341
|
|
|
|
|
|
||||
Retained earnings
|
2,518
|
|
|
2,461
|
|
|
|
|
|
||||
Accumulated other comprehensive loss
|
(30
|
)
|
|
(32
|
)
|
|
|
|
|
||||
Total common stockholder's equity
|
6,323
|
|
|
5,992
|
|
|
48.1
|
|
|
46.4
|
|
||
Total Capitalization
|
$
|
13,139
|
|
|
$
|
12,927
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Number of
Common
Shares
Issued
|
|
Common
Stock
|
|
Paid-In
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
|
|||||||||||
|
(in millions)
|
|||||||||||||||||||||
Balance at December 31, 2013
|
31
|
|
|
$
|
1,222
|
|
|
$
|
2,262
|
|
|
$
|
2,044
|
|
|
$
|
(26
|
)
|
|
$
|
5,502
|
|
Net income after dividends on preferred
and preference stock
|
—
|
|
|
—
|
|
|
—
|
|
|
761
|
|
|
—
|
|
|
761
|
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
42
|
|
|
—
|
|
|
—
|
|
|
42
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
|||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(550
|
)
|
|
—
|
|
|
(550
|
)
|
|||||
Balance at December 31, 2014
|
31
|
|
|
1,222
|
|
|
2,304
|
|
|
2,255
|
|
|
(29
|
)
|
|
5,752
|
|
|||||
Net income after dividends on preferred
and preference stock
|
—
|
|
|
—
|
|
|
—
|
|
|
785
|
|
|
—
|
|
|
785
|
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
37
|
|
|
—
|
|
|
—
|
|
|
37
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
|||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(571
|
)
|
|
—
|
|
|
(571
|
)
|
|||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
|||||
Balance at December 31, 2015
|
31
|
|
|
1,222
|
|
|
2,341
|
|
|
2,461
|
|
|
(32
|
)
|
|
5,992
|
|
|||||
Net income after dividends on preferred
and preference stock
|
—
|
|
|
—
|
|
|
—
|
|
|
822
|
|
|
—
|
|
|
822
|
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
272
|
|
|
—
|
|
|
—
|
|
|
272
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(765
|
)
|
|
—
|
|
|
(765
|
)
|
|||||
Balance at December 31, 2016
|
31
|
|
|
$
|
1,222
|
|
|
$
|
2,613
|
|
|
$
|
2,518
|
|
|
$
|
(30
|
)
|
|
$
|
6,323
|
|
Note
|
|
Page
|
1
|
||
2
|
||
3
|
||
4
|
||
5
|
||
6
|
||
7
|
||
8
|
||
9
|
||
10
|
||
11
|
||
12
|
|
2016
|
|
2015
|
|
Note
|
||||
|
(in millions)
|
|
|
||||||
Retiree benefit plans
|
$
|
947
|
|
|
$
|
903
|
|
|
(i,j)
|
Deferred income tax charges
|
526
|
|
|
522
|
|
|
(a,k)
|
||
Under/(over) recovered regulatory clause revenues
|
76
|
|
|
(97
|
)
|
|
(d)
|
||
Nuclear outage
|
70
|
|
|
53
|
|
|
(d)
|
||
Remaining net book value of retired assets
|
69
|
|
|
76
|
|
|
(l)
|
||
Vacation pay
|
69
|
|
|
66
|
|
|
(c,j)
|
||
Loss on reacquired debt
|
68
|
|
|
75
|
|
|
(b)
|
||
Other regulatory assets
|
50
|
|
|
53
|
|
|
(f)
|
||
Asset retirement obligations
|
12
|
|
|
(40
|
)
|
|
(a)
|
||
Fuel-hedging losses
|
1
|
|
|
55
|
|
|
(e,j)
|
||
Other cost of removal obligations
|
(684
|
)
|
|
(722
|
)
|
|
(a)
|
||
Natural disaster reserve
|
(69
|
)
|
|
(75
|
)
|
|
(h)
|
||
Deferred income tax credits
|
(65
|
)
|
|
(70
|
)
|
|
(a)
|
||
Other regulatory liabilities
|
(23
|
)
|
|
(8
|
)
|
|
(e,g)
|
||
Total regulatory assets (liabilities), net
|
$
|
1,047
|
|
|
$
|
791
|
|
|
|
(a)
|
Asset retirement and removal assets and liabilities are recorded, deferred income tax assets are recovered, and deferred income tax liabilities are amortized over the related property lives, which may range up to
50 years
. Asset retirement and other cost of removal assets and liabilities will be settled and trued up following completion of the related activities.
|
(b)
|
Recovered over the remaining life of the original issue, which may range up to
50 years
.
|
(c)
|
Recorded as earned by employees and recovered as paid, generally within
one year
. This includes both vacation and banked holiday pay.
|
(d)
|
Recorded and recovered or amortized as approved or accepted by the Alabama PSC over periods not exceeding
10 years
. See Note 3 under "Retail Regulatory Matters" for additional information.
|
(e)
|
Fuel-hedging assets and liabilities are recorded over the life of the underlying hedged purchase contracts, which generally do not exceed
three and a half years
. Upon final settlement, actual costs incurred are recovered through the energy cost recovery clause.
|
(f)
|
Comprised of components including generation site selection/evaluation costs, PPA capacity (to be recovered over the next
12 months
), and other miscellaneous assets. Recorded as accepted by the Alabama PSC. Capitalized upon initialization of related construction projects, if applicable.
|
(g)
|
Comprised of components including mine reclamation and remediation liabilities and fuel-hedging gains. Recorded as accepted by the Alabama PSC. Mine reclamation and remediation liabilities will be settled following completion of the related activities.
|
(h)
|
Utilized as storm restoration and potential reliability-related expenses are incurred, as approved by the Alabama PSC.
|
(i)
|
Recovered and amortized over the average remaining service period which may range up to
15 years
. See Note 2 for additional information.
|
(j)
|
Not earning a return as offset in rate base by a corresponding asset or liability.
|
(k)
|
Included in the deferred income tax charges are
$16 million
for 2016 and
$17 million
for 2015 for the retiree Medicare drug subsidy, which is recovered and amortized, as approved by the Alabama PSC, over the average remaining service period which may range up to
15 years
.
|
(l)
|
Recorded and amortized as approved by the Alabama PSC for a period up to
11 years
.
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Generation
|
$
|
13,551
|
|
|
$
|
12,820
|
|
Transmission
|
3,921
|
|
|
3,773
|
|
||
Distribution
|
6,707
|
|
|
6,432
|
|
||
General
|
1,840
|
|
|
1,713
|
|
||
Plant acquisition adjustment
|
12
|
|
|
12
|
|
||
Total plant in service
|
$
|
26,031
|
|
|
$
|
24,750
|
|
|
2016
|
|
|
2015
|
|
||||
|
(in millions)
|
|
|||||||
Balance at beginning of year
|
$
|
1,448
|
|
|
|
$
|
829
|
|
|
Liabilities incurred
|
5
|
|
|
|
402
|
|
|
||
Liabilities settled
|
(25
|
)
|
|
|
(3
|
)
|
|
||
Accretion
|
73
|
|
|
|
53
|
|
|
||
Cash flow revisions
|
32
|
|
|
|
167
|
|
|
||
Balance at end of year
|
$
|
1,533
|
|
|
|
$
|
1,448
|
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
External trust funds
|
$
|
790
|
|
|
$
|
734
|
|
Internal reserves
|
19
|
|
|
20
|
|
||
Total
|
$
|
809
|
|
|
$
|
754
|
|
Decommissioning periods:
|
|
||
Beginning year
|
2037
|
|
|
Completion year
|
2076
|
|
|
|
(in millions)
|
||
Site study costs:
|
|
||
Radiated structures
|
$
|
1,362
|
|
Non-radiated structures
|
80
|
|
|
Total site study costs
|
$
|
1,442
|
|
Assumptions used to determine net periodic costs:
|
2016
|
|
2015
|
|
2014
|
|||
Pension plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.67
|
%
|
|
4.18
|
%
|
|
5.02
|
%
|
Discount rate – interest costs
|
3.90
|
|
|
4.18
|
|
|
5.02
|
|
Discount rate – service costs
|
5.07
|
|
|
4.49
|
|
|
5.02
|
|
Expected long-term return on plan assets
|
8.20
|
|
|
8.20
|
|
|
8.20
|
|
Annual salary increase
|
4.46
|
|
|
3.59
|
|
|
3.59
|
|
Other postretirement benefit plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.51
|
%
|
|
4.04
|
%
|
|
4.86
|
%
|
Discount rate – interest costs
|
3.69
|
|
|
4.04
|
|
|
4.86
|
|
Discount rate – service costs
|
4.96
|
|
|
4.40
|
|
|
4.86
|
|
Expected long-term return on plan assets
|
6.83
|
|
|
7.17
|
|
|
7.34
|
|
Annual salary increase
|
4.46
|
|
|
3.59
|
|
|
3.59
|
|
Assumptions used to determine benefit obligations:
|
2016
|
|
2015
|
||
Pension plans
|
|
|
|
||
Discount rate
|
4.44
|
%
|
|
4.67
|
%
|
Annual salary increase
|
4.46
|
|
|
4.46
|
|
Other postretirement benefit plans
|
|
|
|
||
Discount rate
|
4.27
|
%
|
|
4.51
|
%
|
Annual salary increase
|
4.46
|
|
|
4.46
|
|
|
Initial Cost Trend Rate
|
|
Ultimate Cost Trend Rate
|
|
Year That Ultimate Rate is Reached
|
||
Pre-65
|
6.50
|
%
|
|
4.50
|
%
|
|
2025
|
Post-65 medical
|
5.00
|
|
|
4.50
|
|
|
2025
|
Post-65 prescription
|
10.00
|
|
|
4.50
|
|
|
2025
|
|
1 Percent
Increase
|
|
1 Percent
Decrease
|
||||
|
(in millions)
|
||||||
Benefit obligation
|
$
|
28
|
|
|
$
|
24
|
|
Service and interest costs
|
1
|
|
|
1
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
2,506
|
|
|
$
|
2,592
|
|
Service cost
|
57
|
|
|
59
|
|
||
Interest cost
|
95
|
|
|
106
|
|
||
Benefits paid
|
(109
|
)
|
|
(120
|
)
|
||
Actuarial (gain) loss
|
114
|
|
|
(131
|
)
|
||
Balance at end of year
|
2,663
|
|
|
2,506
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
2,279
|
|
|
2,396
|
|
||
Actual return (loss) on plan assets
|
206
|
|
|
(9
|
)
|
||
Employer contributions
|
141
|
|
|
12
|
|
||
Benefits paid
|
(109
|
)
|
|
(120
|
)
|
||
Fair value of plan assets at end of year
|
2,517
|
|
|
2,279
|
|
||
Accrued liability
|
$
|
(146
|
)
|
|
$
|
(227
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
870
|
|
|
$
|
822
|
|
Other current liabilities
|
(12
|
)
|
|
(11
|
)
|
||
Employee benefit obligations
|
(134
|
)
|
|
(216
|
)
|
|
2016
|
|
2015
|
|
Estimated
Amortization
in 2017
|
||||||
|
(in millions)
|
||||||||||
Prior service cost
|
$
|
10
|
|
|
$
|
6
|
|
|
$
|
3
|
|
Net (gain) loss
|
860
|
|
|
816
|
|
|
42
|
|
|||
Regulatory assets
|
$
|
870
|
|
|
$
|
822
|
|
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Regulatory assets:
|
|
|
|
||||
Beginning balance
|
$
|
822
|
|
|
$
|
827
|
|
Net (gain) loss
|
84
|
|
|
56
|
|
||
Change in prior service costs
|
7
|
|
|
—
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
(3
|
)
|
|
(6
|
)
|
||
Amortization of net gain (loss)
|
(40
|
)
|
|
(55
|
)
|
||
Total reclassification adjustments
|
(43
|
)
|
|
(61
|
)
|
||
Total change
|
48
|
|
|
(5
|
)
|
||
Ending balance
|
$
|
870
|
|
|
$
|
822
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
57
|
|
|
$
|
59
|
|
|
$
|
48
|
|
Interest cost
|
95
|
|
|
106
|
|
|
103
|
|
|||
Expected return on plan assets
|
(184
|
)
|
|
(178
|
)
|
|
(168
|
)
|
|||
Recognized net (gain) loss
|
40
|
|
|
55
|
|
|
31
|
|
|||
Net amortization
|
3
|
|
|
6
|
|
|
7
|
|
|||
Net periodic pension cost
|
$
|
11
|
|
|
$
|
48
|
|
|
$
|
21
|
|
|
Benefit
Payments
|
||
|
(in millions)
|
||
2017
|
$
|
122
|
|
2018
|
127
|
|
|
2019
|
132
|
|
|
2020
|
137
|
|
|
2021
|
142
|
|
|
2022 to 2026
|
777
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
505
|
|
|
$
|
503
|
|
Service cost
|
5
|
|
|
6
|
|
||
Interest cost
|
18
|
|
|
20
|
|
||
Benefits paid
|
(28
|
)
|
|
(27
|
)
|
||
Actuarial (gain) loss
|
(1
|
)
|
|
(7
|
)
|
||
Plan amendment
|
—
|
|
|
7
|
|
||
Retiree drug subsidy
|
2
|
|
|
3
|
|
||
Balance at end of year
|
501
|
|
|
505
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
363
|
|
|
392
|
|
||
Actual return (loss) on plan assets
|
23
|
|
|
(6
|
)
|
||
Employer contributions
|
7
|
|
|
1
|
|
||
Benefits paid
|
(26
|
)
|
|
(24
|
)
|
||
Fair value of plan assets at end of year
|
367
|
|
|
363
|
|
||
Accrued liability
|
$
|
(134
|
)
|
|
$
|
(142
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
86
|
|
|
$
|
95
|
|
Other regulatory liabilities, deferred
|
(10
|
)
|
|
(13
|
)
|
||
Employee benefit obligations
|
(134
|
)
|
|
(142
|
)
|
|
2016
|
|
2015
|
|
Estimated
Amortization
in 2017
|
||||||
|
(in millions)
|
||||||||||
Prior service cost
|
$
|
15
|
|
|
$
|
19
|
|
|
$
|
4
|
|
Net (gain) loss
|
61
|
|
|
63
|
|
|
1
|
|
|||
Net regulatory assets
|
$
|
76
|
|
|
$
|
82
|
|
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Net regulatory assets (liabilities):
|
|
|
|
||||
Beginning balance
|
$
|
82
|
|
|
$
|
54
|
|
Net (gain) loss
|
—
|
|
|
25
|
|
||
Change in prior service costs
|
—
|
|
|
8
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
(4
|
)
|
|
(3
|
)
|
||
Amortization of net gain (loss)
|
(2
|
)
|
|
(2
|
)
|
||
Total reclassification adjustments
|
(6
|
)
|
|
(5
|
)
|
||
Total change
|
(6
|
)
|
|
28
|
|
||
Ending balance
|
$
|
76
|
|
|
$
|
82
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
5
|
|
|
$
|
6
|
|
|
$
|
5
|
|
Interest cost
|
18
|
|
|
20
|
|
|
20
|
|
|||
Expected return on plan assets
|
(25
|
)
|
|
(26
|
)
|
|
(25
|
)
|
|||
Net amortization
|
6
|
|
|
5
|
|
|
4
|
|
|||
Net periodic postretirement benefit cost
|
$
|
4
|
|
|
$
|
5
|
|
|
$
|
4
|
|
|
Benefit
Payments
|
|
Subsidy
Receipts
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
2017
|
$
|
32
|
|
|
$
|
(3
|
)
|
|
$
|
29
|
|
2018
|
33
|
|
|
(3
|
)
|
|
30
|
|
|||
2019
|
34
|
|
|
(4
|
)
|
|
30
|
|
|||
2020
|
35
|
|
|
(4
|
)
|
|
31
|
|
|||
2021
|
36
|
|
|
(4
|
)
|
|
32
|
|
|||
2022 to 2026
|
183
|
|
|
(22
|
)
|
|
161
|
|
|
Target
|
|
2016
|
|
2015
|
|||
Pension plan assets:
|
|
|
|
|
|
|||
Domestic equity
|
26
|
%
|
|
29
|
%
|
|
30
|
%
|
International equity
|
25
|
|
|
22
|
|
|
23
|
|
Fixed income
|
23
|
|
|
29
|
|
|
23
|
|
Special situations
|
3
|
|
|
2
|
|
|
2
|
|
Real estate investments
|
14
|
|
|
13
|
|
|
16
|
|
Private equity
|
9
|
|
|
5
|
|
|
6
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Other postretirement benefit plan assets:
|
|
|
|
|
|
|||
Domestic equity
|
46
|
%
|
|
44
|
%
|
|
45
|
%
|
International equity
|
22
|
|
|
20
|
|
|
20
|
|
Domestic fixed income
|
24
|
|
|
29
|
|
|
27
|
|
Special situations
|
1
|
|
|
1
|
|
|
1
|
|
Real estate investments
|
4
|
|
|
4
|
|
|
5
|
|
Private equity
|
3
|
|
|
2
|
|
|
2
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
•
|
Domestic equity.
A mix of large and small capitalization stocks with generally an equal distribution of value and growth attributes, managed both actively and through passive index approaches.
|
•
|
International equity.
A mix of growth stocks and value stocks with both developed and emerging market exposure, managed both actively and through passive index approaches.
|
•
|
Fixed income.
A mix of domestic and international bonds.
|
•
|
Trust-owned life insurance (TOLI).
Investments of the Company's taxable trusts aimed at minimizing the impact of taxes on the portfolio.
|
•
|
Special situations.
Investments in opportunistic strategies with the objective of diversifying and enhancing returns and exploiting short-term inefficiencies as well as investments in promising new strategies of a longer-term nature.
|
•
|
Real estate investments.
Investments in traditional private market, equity-oriented investments in real properties (indirectly through pooled funds or partnerships) and in publicly traded real estate securities.
|
•
|
Private equity.
Investments in private partnerships that invest in private or public securities typically through privately-negotiated and/or structured transactions, including leveraged buyouts, venture capital, and distressed debt.
|
•
|
Domestic and international equity.
Investments in equity securities such as common stocks, American depositary receipts, and real estate investment trusts that trade on a public exchange are classified as Level 1 investments and are valued at the closing price in the active market. Equity investments with unpublished prices (i.e. pooled funds) are valued as Level 2, when the underlying holdings used to value the investment are comprised of Level 1 or Level 2 equity securities.
|
•
|
Fixed income.
Investments in fixed income securities are generally classified as Level 2 investments and are valued based on prices reported in the market place. Additionally, the value of fixed income securities takes into consideration certain items such as broker quotes, spreads, yield curves, interest rates, and discount rates that apply to the term of a specific instrument.
|
•
|
TOLI.
Investments in TOLI policies are classified as Level 2 investments and are valued based on the underlying investments held in the policy's separate account. The underlying assets are equity and fixed income pooled funds that are comprised of Level 1 and Level 2 securities.
|
•
|
Real estate investments, private equity, and special situations investments.
Investments in real estate, private equity, and special situations are generally classified as Net Asset Value as a Practical Expedient, since the underlying assets typically do not have publicly available observable inputs. The fund manager values the assets using various inputs and techniques depending on the nature of the underlying investments. Techniques may include purchase multiples for comparable transactions, comparable public company trading multiples, discounted cash flow analysis, prevailing market capitalization rates, recent sales of comparable investments, and independent third-party appraisals. The fair value of partnerships is determined by aggregating the value of the underlying assets less liabilities.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices
in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
477
|
|
|
$
|
220
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
697
|
|
International equity
(*)
|
292
|
|
|
264
|
|
|
—
|
|
|
—
|
|
|
556
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
140
|
|
|
—
|
|
|
—
|
|
|
140
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Corporate bonds
|
—
|
|
|
235
|
|
|
—
|
|
|
—
|
|
|
235
|
|
|||||
Pooled funds
|
—
|
|
|
124
|
|
|
—
|
|
|
—
|
|
|
124
|
|
|||||
Cash equivalents and other
|
236
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
237
|
|
|||||
Real estate investments
|
74
|
|
|
—
|
|
|
—
|
|
|
274
|
|
|
348
|
|
|||||
Special situations
|
—
|
|
|
—
|
|
|
—
|
|
|
43
|
|
|
43
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
130
|
|
|
130
|
|
|||||
Total
|
$
|
1,079
|
|
|
$
|
987
|
|
|
$
|
—
|
|
|
$
|
447
|
|
|
$
|
2,513
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices
in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
403
|
|
|
$
|
168
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
571
|
|
International equity
(*)
|
294
|
|
|
244
|
|
|
—
|
|
|
—
|
|
|
538
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
112
|
|
|
—
|
|
|
—
|
|
|
112
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
49
|
|
|
—
|
|
|
—
|
|
|
49
|
|
|||||
Corporate bonds
|
—
|
|
|
280
|
|
|
—
|
|
|
—
|
|
|
280
|
|
|||||
Pooled funds
|
—
|
|
|
123
|
|
|
—
|
|
|
—
|
|
|
123
|
|
|||||
Cash equivalents and other
|
—
|
|
|
36
|
|
|
—
|
|
|
—
|
|
|
36
|
|
|||||
Real estate investments
|
74
|
|
|
—
|
|
|
—
|
|
|
301
|
|
|
375
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
157
|
|
|
157
|
|
|||||
Total
|
$
|
771
|
|
|
$
|
1,012
|
|
|
$
|
—
|
|
|
$
|
458
|
|
|
$
|
2,241
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
51
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
61
|
|
International equity
(*)
|
13
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
25
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Corporate bonds
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|||||
Pooled funds
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||
Cash equivalents and other
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14
|
|
|||||
Trust-owned life insurance
|
—
|
|
|
220
|
|
|
—
|
|
|
—
|
|
|
220
|
|
|||||
Real estate investments
|
4
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
16
|
|
|||||
Special situations
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
6
|
|
|||||
Total
|
$
|
82
|
|
|
$
|
264
|
|
|
$
|
—
|
|
|
$
|
20
|
|
|
$
|
366
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
57
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
65
|
|
International equity
(*)
|
14
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
26
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Corporate bonds
|
—
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|||||
Pooled funds
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|||||
Cash equivalents and other
|
1
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Trust-owned life insurance
|
—
|
|
|
212
|
|
|
—
|
|
|
—
|
|
|
212
|
|
|||||
Real estate investments
|
5
|
|
|
—
|
|
|
—
|
|
|
14
|
|
|
19
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
|||||
Total
|
$
|
77
|
|
|
$
|
263
|
|
|
$
|
—
|
|
|
$
|
21
|
|
|
$
|
361
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
Facility
|
Total MW Capacity
|
|
Company Ownership
|
|
|
Plant in Service
|
|
Accumulated Depreciation
|
|
Construction Work in Progress
|
||||||||
|
|
|
|
|
|
(in millions)
|
||||||||||||
Greene County
|
500
|
|
|
60.00
|
%
|
(1)
|
|
$
|
168
|
|
|
$
|
66
|
|
|
$
|
1
|
|
Plant Miller
|
|
|
|
|
|
|
|
|
|
|
||||||||
Units 1 and 2
|
1,320
|
|
|
91.84
|
%
|
(2)
|
|
1,657
|
|
|
587
|
|
|
23
|
|
(1)
|
Jointly owned with an affiliate, Mississippi Power.
|
(2)
|
Jointly owned with PowerSouth Energy Cooperative, Inc.
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Federal —
|
|
|
|
|
|
||||||
Current
|
$
|
103
|
|
|
$
|
110
|
|
|
$
|
198
|
|
Deferred
|
339
|
|
|
320
|
|
|
225
|
|
|||
|
442
|
|
|
430
|
|
|
423
|
|
|||
State —
|
|
|
|
|
|
||||||
Current
|
20
|
|
|
8
|
|
|
44
|
|
|||
Deferred
|
69
|
|
|
68
|
|
|
45
|
|
|||
|
89
|
|
|
76
|
|
|
89
|
|
|||
Total
|
$
|
531
|
|
|
$
|
506
|
|
|
$
|
512
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Deferred tax liabilities —
|
|
|
|
||||
Accelerated depreciation
|
$
|
4,307
|
|
|
$
|
3,917
|
|
Property basis differences
|
456
|
|
|
456
|
|
||
Premium on reacquired debt
|
26
|
|
|
28
|
|
||
Employee benefit obligations
|
201
|
|
|
200
|
|
||
Regulatory assets associated with employee benefit obligations
|
393
|
|
|
375
|
|
||
Asset retirement obligations
|
289
|
|
|
289
|
|
||
Regulatory assets associated with asset retirement obligations
|
347
|
|
|
312
|
|
||
Other
|
179
|
|
|
175
|
|
||
Total
|
6,198
|
|
|
5,752
|
|
||
Deferred tax assets —
|
|
|
|
||||
Federal effect of state deferred taxes
|
266
|
|
|
242
|
|
||
Unbilled fuel revenue
|
36
|
|
|
39
|
|
||
Storm reserve
|
21
|
|
|
23
|
|
||
Employee benefit obligations
|
427
|
|
|
407
|
|
||
Other comprehensive losses
|
19
|
|
|
20
|
|
||
Asset retirement obligations
|
636
|
|
|
600
|
|
||
Other
|
139
|
|
|
180
|
|
||
Total
|
1,544
|
|
|
1,511
|
|
||
Accumulated deferred income taxes, net
|
$
|
4,654
|
|
|
$
|
4,241
|
|
|
2016
|
|
2015
|
|
2014
|
Federal statutory rate
|
35.0%
|
|
35.0%
|
|
35.0%
|
State income tax, net of federal deduction
|
4.2
|
|
3.8
|
|
4.4
|
Non-deductible book depreciation
|
1.0
|
|
1.2
|
|
1.1
|
AFUDC equity
|
(0.7)
|
|
(1.6)
|
|
(1.3)
|
Other
|
(0.7)
|
|
—
|
|
(0.2)
|
Effective income tax rate
|
38.8%
|
|
38.4%
|
|
39.0%
|
Preferred/Preference Stock
|
Par Value/Stated Capital Per Share
|
|
Shares Outstanding
|
|
Redemption Price Per Share
|
|
4.92% Preferred Stock
|
$100
|
|
80,000
|
|
|
$103.23
|
4.72% Preferred Stock
|
$100
|
|
50,000
|
|
|
$102.18
|
4.64% Preferred Stock
|
$100
|
|
60,000
|
|
|
$103.14
|
4.60% Preferred Stock
|
$100
|
|
100,000
|
|
|
$104.20
|
4.52% Preferred Stock
|
$100
|
|
50,000
|
|
|
$102.93
|
4.20% Preferred Stock
|
$100
|
|
135,115
|
|
|
$105.00
|
5.83% Class A Preferred Stock
|
$25
|
|
1,520,000
|
|
|
Stated Capital
|
6.45% Preference Stock
|
$25
|
|
6,000,000
|
|
|
Stated Capital
(*)
|
6.50% Preference Stock
|
$25
|
|
2,000,000
|
|
|
Stated Capital
(*)
|
(*)
|
Also includes a make-whole premium prior to October 1, 2017
|
Expires
|
|
|
|
|
|
Expires Within One Year
|
||||||||||||||||||||
2017
|
|
2018
|
|
2020
|
|
Total
|
|
Unused
|
|
Term Out
|
|
No Term Out
|
||||||||||||||
(in millions)
|
|
(in millions)
|
|
(in millions)
|
||||||||||||||||||||||
$
|
35
|
|
|
$
|
500
|
|
|
$
|
800
|
|
|
$
|
1,335
|
|
|
$
|
1,335
|
|
|
$
|
—
|
|
|
$
|
35
|
|
|
Operating
Lease
PPAs
|
||
|
(in millions)
|
||
2017
|
$
|
40
|
|
2018
|
41
|
|
|
2019
|
43
|
|
|
2020
|
44
|
|
|
2021
|
46
|
|
|
2022
|
47
|
|
|
Total commitments
|
$
|
261
|
|
|
Minimum Lease Payments
|
||||||||||
|
Railcars
|
|
Vehicles & Other
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
2017
|
$
|
10
|
|
|
$
|
4
|
|
|
$
|
14
|
|
2018
|
7
|
|
|
3
|
|
|
10
|
|
|||
2019
|
7
|
|
|
3
|
|
|
10
|
|
|||
2020
|
6
|
|
|
2
|
|
|
8
|
|
|||
2021
|
6
|
|
|
2
|
|
|
8
|
|
|||
2022 and thereafter
|
9
|
|
|
1
|
|
|
10
|
|
|||
Total
|
$
|
45
|
|
|
$
|
15
|
|
|
$
|
60
|
|
•
|
Level 1 consists of observable market data in an active market for identical assets or liabilities.
|
•
|
Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.
|
•
|
Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
20
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20
|
|
Nuclear decommissioning trusts:
(*)
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
|
385
|
|
|
72
|
|
|
—
|
|
|
—
|
|
|
457
|
|
|||||
Foreign equity
|
48
|
|
|
47
|
|
|
—
|
|
|
—
|
|
|
95
|
|
|||||
U.S. Treasury and government agency securities
|
—
|
|
|
21
|
|
|
—
|
|
|
—
|
|
|
21
|
|
|||||
Corporate bonds
|
22
|
|
|
146
|
|
|
—
|
|
|
—
|
|
|
168
|
|
|||||
Mortgage and asset backed securities
|
—
|
|
|
19
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
20
|
|
|
20
|
|
|||||
Other
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|||||
Cash equivalents
|
262
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
262
|
|
|||||
Total
|
$
|
717
|
|
|
$
|
335
|
|
|
$
|
—
|
|
|
$
|
20
|
|
|
$
|
1,072
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9
|
|
(*)
|
Excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases. See Note 1 under "Nuclear Decommissioning" for additional information.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Nuclear decommissioning trusts:
(*)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Domestic equity
|
359
|
|
|
68
|
|
|
—
|
|
|
—
|
|
|
427
|
|
|||||
Foreign equity
|
47
|
|
|
47
|
|
|
—
|
|
|
—
|
|
|
94
|
|
|||||
U.S. Treasury and government agency securities
|
—
|
|
|
27
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|||||
Corporate bonds
|
11
|
|
|
135
|
|
|
—
|
|
|
—
|
|
|
146
|
|
|||||
Mortgage and asset backed securities
|
—
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
17
|
|
|||||
Other
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||
Cash equivalents
|
68
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
68
|
|
|||||
Total
|
$
|
485
|
|
|
$
|
301
|
|
|
$
|
—
|
|
|
$
|
17
|
|
|
$
|
803
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate derivatives
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
15
|
|
Energy-related derivatives
|
—
|
|
|
55
|
|
|
—
|
|
|
—
|
|
|
55
|
|
|||||
Total
|
$
|
—
|
|
|
$
|
70
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
70
|
|
(*)
|
Excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases. See Note 1 under "Nuclear Decommissioning" for additional information.
|
|
Fair
Value
|
|
Unfunded
Commitments
|
|
Redemption Frequency
|
|
Redemption
Notice Period
|
||||
|
(in millions)
|
|
|
|
|
||||||
As of December 31, 2016
|
$
|
20
|
|
|
$
|
25
|
|
|
Not Applicable
|
|
Not Applicable
|
As of December 31, 2015
|
$
|
17
|
|
|
$
|
28
|
|
|
Not
Applicable
|
|
Not Applicable
|
|
Carrying
Amount
|
|
Fair
Value
|
||||
|
(in millions)
|
||||||
Long-term debt, including securities due within one year:
|
|
|
|
||||
2016
|
$
|
7,092
|
|
|
$
|
7,544
|
|
2015
|
$
|
6,849
|
|
|
$
|
7,192
|
|
•
|
Regulatory Hedges
– Energy-related derivative contracts which are designated as regulatory hedges relate primarily to the Company's fuel-hedging programs, where gains and losses are initially recorded as regulatory liabilities and assets, respectively, and then are included in fuel expense as the underlying fuel is used in operations and ultimately recovered through the energy cost recovery clause.
|
•
|
Not Designated
– Gains and losses on energy-related derivative contracts that are not designated or fail to qualify as hedges are recognized in the statements of income as incurred.
|
|
2016
|
2015
|
||||||||||
Derivative Category and Balance Sheet Location
|
Assets
|
Liabilities
|
Assets
|
Liabilities
|
||||||||
|
(in millions)
|
|||||||||||
Derivatives designated as hedging instruments for regulatory purposes
|
|
|
|
|
||||||||
Energy-related derivatives:
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
$
|
13
|
|
$
|
5
|
|
$
|
1
|
|
$
|
40
|
|
Other deferred charges and assets/Other deferred credits and liabilities
|
7
|
|
4
|
|
—
|
|
15
|
|
||||
Total derivatives designated as hedging instruments for regulatory purposes
|
$
|
20
|
|
$
|
9
|
|
$
|
1
|
|
$
|
55
|
|
Derivatives designated as hedging instruments in cash flow hedges
|
|
|
|
|
||||||||
Interest rate derivatives:
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
15
|
|
Gross amounts recognized
|
$
|
20
|
|
$
|
9
|
|
$
|
1
|
|
$
|
70
|
|
Gross amounts offset
|
$
|
(8
|
)
|
$
|
(8
|
)
|
$
|
(1
|
)
|
$
|
(1
|
)
|
Net amounts recognized in the Balance Sheets
(*)
|
$
|
12
|
|
$
|
1
|
|
$
|
—
|
|
$
|
69
|
|
(*)
|
At December 31, 2015, the fair value amounts for derivative contracts subject to netting arrangements were presented gross on the balance sheet.
|
|
Unrealized Losses
|
|
Unrealized Gains
|
||||||||||||||
Derivative Category
|
Balance Sheet
Location
|
2016
|
|
2015
|
|
Balance Sheet
Location
|
2016
|
|
2015
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Energy-related derivatives:
(*)
|
Other regulatory assets, current
|
$
|
(1
|
)
|
|
$
|
(40
|
)
|
|
Other current liabilities
|
$
|
8
|
|
|
$
|
1
|
|
|
Other regulatory assets, deferred
|
—
|
|
|
(15
|
)
|
|
Other regulatory liabilities, deferred
|
4
|
|
|
—
|
|
||||
Total energy-related derivative gains (losses)
|
|
$
|
(1
|
)
|
|
$
|
(55
|
)
|
|
|
$
|
12
|
|
|
$
|
1
|
|
(*)
|
At
December 31, 2016
, the unrealized gains and losses for derivative contracts subject to netting arrangements were presented net on the balance sheet. At
December 31, 2015
, the unrealized gains and losses for derivative contracts were presented gross on the balance sheet.
|
Derivatives in Cash Flow Hedging Relationships
|
Gain (Loss) Recognized in
OCI on Derivative
(Effective Portion)
|
|
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
|||||||||||||||||||||
|
|
Amount
|
||||||||||||||||||||||
Derivative Category
|
2016
|
|
2015
|
|
2014
|
|
Statements of Income
Location
|
2016
|
|
2015
|
|
2014
|
||||||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||||||||||
Interest rate derivatives
|
$
|
(3
|
)
|
|
$
|
(7
|
)
|
|
$
|
(8
|
)
|
|
Interest expense, net of amounts capitalized
|
$
|
(6
|
)
|
|
$
|
(3
|
)
|
|
$
|
(3
|
)
|
Quarter Ended
|
Operating
Revenues
|
|
Operating
Income
|
|
Net Income After Dividends on Preferred and Preference Stock
|
||||||
|
(in millions)
|
||||||||||
March 2016
|
$
|
1,331
|
|
|
$
|
333
|
|
|
$
|
156
|
|
June 2016
|
1,444
|
|
|
430
|
|
|
213
|
|
|||
September 2016
|
1,785
|
|
|
650
|
|
|
351
|
|
|||
December 2016
|
1,329
|
|
|
252
|
|
|
102
|
|
|||
|
|
|
|
|
|
||||||
March 2015
|
$
|
1,401
|
|
|
$
|
346
|
|
|
$
|
169
|
|
June 2015
|
1,455
|
|
|
398
|
|
|
200
|
|
|||
September 2015
|
1,695
|
|
|
555
|
|
|
295
|
|
|||
December 2015
|
1,217
|
|
|
264
|
|
|
121
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (in millions)
|
$
|
5,889
|
|
|
$
|
5,768
|
|
|
$
|
5,942
|
|
|
$
|
5,618
|
|
|
$
|
5,520
|
|
Net Income After Dividends
on Preferred and Preference Stock (in millions)
|
$
|
822
|
|
|
$
|
785
|
|
|
$
|
761
|
|
|
$
|
712
|
|
|
$
|
704
|
|
Cash Dividends on Common Stock (in millions)
|
$
|
765
|
|
|
$
|
571
|
|
|
$
|
550
|
|
|
$
|
644
|
|
|
$
|
684
|
|
Return on Average Common Equity (percent)
|
13.34
|
|
|
13.37
|
|
|
13.52
|
|
|
13.07
|
|
|
13.10
|
|
|||||
Total Assets (in millions)
(a)(b)
|
$
|
22,516
|
|
|
$
|
21,721
|
|
|
$
|
20,493
|
|
|
$
|
19,185
|
|
|
$
|
18,647
|
|
Gross Property Additions (in millions)
|
$
|
1,338
|
|
|
$
|
1,492
|
|
|
$
|
1,543
|
|
|
$
|
1,204
|
|
|
$
|
940
|
|
Capitalization (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
$
|
6,323
|
|
|
$
|
5,992
|
|
|
$
|
5,752
|
|
|
$
|
5,502
|
|
|
$
|
5,398
|
|
Preference stock
|
196
|
|
|
196
|
|
|
343
|
|
|
343
|
|
|
343
|
|
|||||
Redeemable preferred stock
|
85
|
|
|
85
|
|
|
342
|
|
|
342
|
|
|
342
|
|
|||||
Long-term debt
(a)
|
6,535
|
|
|
6,654
|
|
|
6,137
|
|
|
6,195
|
|
|
5,890
|
|
|||||
Total (excluding amounts due within one year)
|
$
|
13,139
|
|
|
$
|
12,927
|
|
|
$
|
12,574
|
|
|
$
|
12,382
|
|
|
$
|
11,973
|
|
Capitalization Ratios (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
48.1
|
|
|
46.4
|
|
|
45.8
|
|
|
44.4
|
|
|
45.1
|
|
|||||
Preference stock
|
1.5
|
|
|
1.5
|
|
|
2.7
|
|
|
2.8
|
|
|
2.9
|
|
|||||
Redeemable preferred stock
|
0.7
|
|
|
0.7
|
|
|
2.7
|
|
|
2.7
|
|
|
2.9
|
|
|||||
Long-term debt
(a)
|
49.7
|
|
|
51.4
|
|
|
48.8
|
|
|
50.1
|
|
|
49.1
|
|
|||||
Total (excluding amounts due within one year)
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|||||
Customers (year-end):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
1,262,752
|
|
|
1,253,875
|
|
|
1,247,061
|
|
|
1,241,998
|
|
|
1,237,730
|
|
|||||
Commercial
|
199,146
|
|
|
197,920
|
|
|
197,082
|
|
|
196,209
|
|
|
196,177
|
|
|||||
Industrial
|
6,090
|
|
|
6,056
|
|
|
6,032
|
|
|
5,851
|
|
|
5,839
|
|
|||||
Other
|
762
|
|
|
757
|
|
|
753
|
|
|
751
|
|
|
748
|
|
|||||
Total
|
1,468,750
|
|
|
1,458,608
|
|
|
1,450,928
|
|
|
1,444,809
|
|
|
1,440,494
|
|
|||||
Employees (year-end)
|
6,805
|
|
|
6,986
|
|
|
6,935
|
|
|
6,896
|
|
|
6,778
|
|
(a)
|
A reclassification of debt issuance costs from Total Assets to Long-term debt of $40 million, $38 million, and $39 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
(b)
|
A reclassification of deferred tax assets from Total Assets of $20 million, $27 million, and $27 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (
in millions
):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
$
|
2,322
|
|
|
$
|
2,207
|
|
|
$
|
2,209
|
|
|
$
|
2,079
|
|
|
$
|
2,068
|
|
Commercial
|
1,627
|
|
|
1,564
|
|
|
1,533
|
|
|
1,477
|
|
|
1,491
|
|
|||||
Industrial
|
1,416
|
|
|
1,436
|
|
|
1,480
|
|
|
1,369
|
|
|
1,346
|
|
|||||
Other
|
(43
|
)
|
|
27
|
|
|
27
|
|
|
27
|
|
|
28
|
|
|||||
Total retail
|
5,322
|
|
|
5,234
|
|
|
5,249
|
|
|
4,952
|
|
|
4,933
|
|
|||||
Wholesale — non-affiliates
|
283
|
|
|
241
|
|
|
281
|
|
|
248
|
|
|
277
|
|
|||||
Wholesale — affiliates
|
69
|
|
|
84
|
|
|
189
|
|
|
212
|
|
|
111
|
|
|||||
Total revenues from sales of electricity
|
5,674
|
|
|
5,559
|
|
|
5,719
|
|
|
5,412
|
|
|
5,321
|
|
|||||
Other revenues
|
215
|
|
|
209
|
|
|
223
|
|
|
206
|
|
|
199
|
|
|||||
Total
|
$
|
5,889
|
|
|
$
|
5,768
|
|
|
$
|
5,942
|
|
|
$
|
5,618
|
|
|
$
|
5,520
|
|
Kilowatt-Hour Sales (
in millions
):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
18,343
|
|
|
18,082
|
|
|
18,726
|
|
|
17,920
|
|
|
17,612
|
|
|||||
Commercial
|
14,091
|
|
|
14,102
|
|
|
14,118
|
|
|
13,892
|
|
|
13,963
|
|
|||||
Industrial
|
22,310
|
|
|
23,380
|
|
|
23,799
|
|
|
22,904
|
|
|
22,158
|
|
|||||
Other
|
208
|
|
|
201
|
|
|
211
|
|
|
211
|
|
|
214
|
|
|||||
Total retail
|
54,952
|
|
|
55,765
|
|
|
56,854
|
|
|
54,927
|
|
|
53,947
|
|
|||||
Wholesale — non-affiliates
|
3,597
|
|
|
3,567
|
|
|
3,588
|
|
|
3,711
|
|
|
4,196
|
|
|||||
Wholesale — affiliates
|
5,324
|
|
|
4,515
|
|
|
6,713
|
|
|
7,672
|
|
|
4,279
|
|
|||||
Total
|
63,873
|
|
|
63,847
|
|
|
67,155
|
|
|
66,310
|
|
|
62,422
|
|
|||||
Average Revenue Per Kilowatt-Hour (
cents
):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
12.66
|
|
|
12.21
|
|
|
11.80
|
|
|
11.60
|
|
|
11.74
|
|
|||||
Commercial
|
11.55
|
|
|
11.09
|
|
|
10.86
|
|
|
10.63
|
|
|
10.68
|
|
|||||
Industrial
|
6.35
|
|
|
6.14
|
|
|
6.22
|
|
|
5.98
|
|
|
6.07
|
|
|||||
Total retail
|
9.68
|
|
|
9.39
|
|
|
9.23
|
|
|
9.02
|
|
|
9.14
|
|
|||||
Wholesale
|
3.95
|
|
|
4.02
|
|
|
4.56
|
|
|
4.04
|
|
|
4.58
|
|
|||||
Total sales
|
8.88
|
|
|
8.71
|
|
|
8.52
|
|
|
8.16
|
|
|
8.52
|
|
|||||
Residential Average Annual
Kilowatt-Hour Use Per Customer
|
14,568
|
|
|
14,454
|
|
|
15,051
|
|
|
14,451
|
|
|
14,252
|
|
|||||
Residential Average Annual
Revenue Per Customer
|
$
|
1,844
|
|
|
$
|
1,764
|
|
|
$
|
1,775
|
|
|
$
|
1,676
|
|
|
$
|
1,674
|
|
Plant Nameplate Capacity
Ratings (
year-end
) (
megawatts
)
|
11,797
|
|
|
11,797
|
|
|
12,222
|
|
|
12,222
|
|
|
12,222
|
|
|||||
Maximum Peak-Hour Demand (
megawatts
):
|
|
|
|
|
|
|
|
|
|
||||||||||
Winter
|
10,282
|
|
|
12,162
|
|
|
11,761
|
|
|
9,347
|
|
|
10,285
|
|
|||||
Summer
|
10,932
|
|
|
11,292
|
|
|
11,054
|
|
|
10,692
|
|
|
11,096
|
|
|||||
Annual Load Factor (
percent
)
|
63.5
|
|
|
58.4
|
|
|
61.4
|
|
|
64.9
|
|
|
61.3
|
|
|||||
Plant Availability (
percent
):
|
|
|
|
|
|
|
|
|
|
||||||||||
Fossil-steam
|
83.0
|
|
|
81.5
|
|
|
82.5
|
|
|
87.3
|
|
|
88.6
|
|
|||||
Nuclear
|
88.0
|
|
|
92.1
|
|
|
93.3
|
|
|
90.7
|
|
|
94.5
|
|
|||||
Source of Energy Supply (
percent
):
|
|
|
|
|
|
|
|
|
|
||||||||||
Coal
|
47.1
|
|
|
49.1
|
|
|
49.0
|
|
|
50.0
|
|
|
48.2
|
|
|||||
Nuclear
|
20.3
|
|
|
21.3
|
|
|
20.7
|
|
|
20.3
|
|
|
22.6
|
|
|||||
Hydro
|
4.8
|
|
|
5.6
|
|
|
5.5
|
|
|
8.1
|
|
|
4.1
|
|
|||||
Gas
|
17.1
|
|
|
14.6
|
|
|
15.4
|
|
|
15.7
|
|
|
16.8
|
|
|||||
Purchased power —
|
|
|
|
|
|
|
|
|
|
||||||||||
From non-affiliates
|
4.8
|
|
|
4.4
|
|
|
3.6
|
|
|
2.9
|
|
|
2.0
|
|
|||||
From affiliates
|
5.9
|
|
|
5.0
|
|
|
5.8
|
|
|
3.0
|
|
|
6.3
|
|
|||||
Total
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
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
|
CCR
|
Coal combustion residuals
|
Clean Air Act
|
Clean Air Act Amendments of 1990
|
CO
2
|
Carbon dioxide
|
CWIP
|
Construction work in progress
|
DOE
|
U.S. Department of Energy
|
EPA
|
U.S. Environmental Protection Agency
|
FASB
|
Financial Accounting Standards Board
|
FERC
|
Federal Energy Regulatory Commission
|
FFB
|
Federal Financing Bank
|
GAAP
|
U.S. generally accepted accounting principles
|
Gulf Power
|
Gulf Power Company
|
IRS
|
Internal Revenue Service
|
ITC
|
Investment tax credit
|
KWH
|
Kilowatt-hour
|
LIBOR
|
London Interbank Offered Rate
|
Mississippi Power
|
Mississippi Power Company
|
mmBtu
|
Million British thermal units
|
Moody's
|
Moody's Investors Service, Inc.
|
MW
|
Megawatt
|
NCCR
|
Nuclear Construction Cost Recovery
|
NRC
|
U.S. Nuclear Regulatory Commission
|
OCI
|
Other comprehensive income
|
Plant Vogtle Units 3 and 4
|
Two new nuclear generating units under construction at Plant Vogtle
|
power pool
|
The operating arrangement whereby the integrated generating resources of the traditional electric operating companies and Southern Power (excluding subsidiaries) are subject to joint commitment and dispatch in order to serve their combined load obligations
|
PPA
|
Power purchase agreement
|
PSC
|
Public Service Commission
|
PTC
|
Production tax credit
|
ROE
|
Return on equity
|
S&P
|
S&P Global Ratings, a division of S&P Global Inc.
|
SCS
|
Southern Company Services, Inc. (the Southern Company system service company)
|
SEC
|
U.S. Securities and Exchange Commission
|
SEGCO
|
Southern Electric Generating Company
|
Southern Company
|
The Southern Company
|
Term
|
Meaning
|
Southern Company Gas
|
Southern Company Gas (formerly known as AGL Resources Inc.) and its subsidiaries
|
Southern Company system
|
Southern Company, the traditional electric operating companies, Southern Power, Southern Company Gas (as of July 1, 2016), SEGCO, Southern Nuclear, SCS, Southern LINC, PowerSecure, Inc. (as of May 9, 2016), and other subsidiaries
|
Southern LINC
|
Southern Communications Services, Inc.
|
Southern Nuclear
|
Southern Nuclear Operating Company, Inc.
|
Southern Power
|
Southern Power Company and its subsidiaries
|
traditional electric operating companies
|
Alabama Power, Georgia Power Company, Gulf Power, and Mississippi Power
|
|
Amount
|
|
Increase (Decrease)
from Prior Year
|
||||||||
|
2016
|
|
2016
|
|
2015
|
||||||
|
(in millions)
|
||||||||||
Operating revenues
|
$
|
8,383
|
|
|
$
|
57
|
|
|
$
|
(662
|
)
|
Fuel
|
1,807
|
|
|
(226
|
)
|
|
(514
|
)
|
|||
Purchased power
|
879
|
|
|
15
|
|
|
(124
|
)
|
|||
Other operations and maintenance
|
1,960
|
|
|
116
|
|
|
(58
|
)
|
|||
Depreciation and amortization
|
855
|
|
|
9
|
|
|
—
|
|
|||
Taxes other than income taxes
|
405
|
|
|
14
|
|
|
(18
|
)
|
|||
Total operating expenses
|
5,906
|
|
|
(72
|
)
|
|
(714
|
)
|
|||
Operating income
|
2,477
|
|
|
129
|
|
|
52
|
|
|||
Interest expense, net of amounts capitalized
|
388
|
|
|
25
|
|
|
15
|
|
|||
Other income (expense), net
|
38
|
|
|
(23
|
)
|
|
38
|
|
|||
Income taxes
|
780
|
|
|
11
|
|
|
40
|
|
|||
Net income
|
1,347
|
|
|
70
|
|
|
35
|
|
|||
Dividends on preferred and preference stock
|
17
|
|
|
—
|
|
|
—
|
|
|||
Net income after dividends on preferred and preference stock
|
$
|
1,330
|
|
|
$
|
70
|
|
|
$
|
35
|
|
|
Amount
|
||||||
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Retail — prior year
|
$
|
7,727
|
|
|
$
|
8,240
|
|
Estimated change resulting from —
|
|
|
|
||||
Rates and pricing
|
154
|
|
|
88
|
|
||
Sales growth (decline)
|
(10
|
)
|
|
63
|
|
||
Weather
|
113
|
|
|
(19
|
)
|
||
Fuel cost recovery
|
(212
|
)
|
|
(645
|
)
|
||
Retail — current year
|
7,772
|
|
|
7,727
|
|
||
Wholesale revenues —
|
|
|
|
||||
Non-affiliates
|
175
|
|
|
215
|
|
||
Affiliates
|
42
|
|
|
20
|
|
||
Total wholesale revenues
|
217
|
|
|
235
|
|
||
Other operating revenues
|
394
|
|
|
364
|
|
||
Total operating revenues
|
$
|
8,383
|
|
|
$
|
8,326
|
|
Percent change
|
0.7
|
%
|
|
(7.4
|
)%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Capacity and other
|
$
|
72
|
|
|
$
|
108
|
|
|
$
|
164
|
|
Energy
|
103
|
|
|
107
|
|
|
171
|
|
|||
Total non-affiliated
|
$
|
175
|
|
|
$
|
215
|
|
|
$
|
335
|
|
|
Total
KWHs
|
|
Total KWH
Percent Change
|
|
Weather-Adjusted
Percent Change
|
|||||||||
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||
|
(in billions)
|
|
|
|
|
|
|
|
|
|||||
Residential
|
27.6
|
|
|
3.5
|
%
|
|
(1.8
|
)%
|
|
1.0
|
%
|
|
1.0
|
%
|
Commercial
|
32.9
|
|
|
0.7
|
|
|
0.9
|
|
|
(1.0
|
)
|
|
1.5
|
|
Industrial
|
23.8
|
|
|
(0.2
|
)
|
|
1.1
|
|
|
(0.9
|
)
|
|
1.0
|
|
Other
|
0.6
|
|
|
(3.5
|
)
|
|
(0.2
|
)
|
|
(3.5
|
)
|
|
(0.1
|
)
|
Total retail
|
84.9
|
|
|
1.3
|
|
|
0.1
|
|
|
(0.4
|
)%
|
|
1.2
|
%
|
Wholesale
|
|
|
|
|
|
|
|
|
|
|||||
Non-affiliates
|
3.4
|
|
|
(2.5
|
)
|
|
(19.0
|
)
|
|
|
|
|
||
Affiliates
|
1.4
|
|
|
153.5
|
|
|
(50.6
|
)
|
|
|
|
|
||
Total wholesale
|
4.8
|
|
|
18.8
|
|
|
(25.5
|
)
|
|
|
|
|
||
Total energy sales
|
89.7
|
|
|
2.1
|
%
|
|
(1.5
|
)%
|
|
|
|
|
|
2016
|
|
2015
|
|
2014
|
|||
Total generation
(in billions of KWHs)
|
68.4
|
|
|
65.9
|
|
|
69.9
|
|
Total purchased power
(in billions of KWHs)
|
24.8
|
|
|
25.6
|
|
|
23.1
|
|
Sources of generation
(percent)
—
|
|
|
|
|
|
|||
Coal
|
36
|
|
|
34
|
|
|
41
|
|
Nuclear
|
24
|
|
|
25
|
|
|
22
|
|
Gas
|
38
|
|
|
39
|
|
|
35
|
|
Hydro
|
2
|
|
|
2
|
|
|
2
|
|
Cost of fuel, generated
(in cents per net KWH)
—
|
|
|
|
|
|
|||
Coal
|
3.28
|
|
|
4.55
|
|
|
4.52
|
|
Nuclear
|
0.85
|
|
|
0.78
|
|
|
0.90
|
|
Gas
|
2.36
|
|
|
2.47
|
|
|
3.67
|
|
Average cost of fuel, generated
(in cents per net KWH)
|
2.33
|
|
|
2.77
|
|
|
3.40
|
|
Average cost of purchased power
(in cents per net KWH)
(
*)
|
4.53
|
|
|
4.33
|
|
|
5.20
|
|
|
Short-term Debt at the End of the Period
|
|
Short-term Debt During the Period
(*)
|
||||||||||||||
|
Amount Outstanding
|
|
Weighted Average Interest Rate
|
|
Average Amount Outstanding
|
|
Weighted Average Interest Rate
|
|
Maximum Amount Outstanding
|
||||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
|
(in millions)
|
||||||||
December 31, 2016:
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
$
|
392
|
|
|
1.1
|
%
|
|
$
|
87
|
|
|
0.8
|
%
|
|
$
|
443
|
|
December 31, 2015:
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
$
|
158
|
|
|
0.6
|
%
|
|
$
|
234
|
|
|
0.3
|
%
|
|
$
|
678
|
|
Short-term bank debt
|
—
|
|
|
—
|
%
|
|
62
|
|
|
0.8
|
%
|
|
250
|
|
|||
Total
|
$
|
158
|
|
|
0.6
|
%
|
|
$
|
296
|
|
|
0.4
|
%
|
|
|
||
December 31, 2014:
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
$
|
156
|
|
|
0.3
|
%
|
|
$
|
280
|
|
|
0.2
|
%
|
|
$
|
703
|
|
Short-term bank debt
|
—
|
|
|
—
|
%
|
|
56
|
|
|
0.9
|
%
|
|
400
|
|
|||
Total
|
$
|
156
|
|
|
0.3
|
%
|
|
$
|
336
|
|
|
0.3
|
%
|
|
|
(*)
|
Average and maximum amounts are based upon daily balances during the twelve-month periods ended December 31, 2016, 2015, and 2014.
|
Credit Ratings
|
Maximum
Potential
Collateral
Requirements
|
||
|
(in millions)
|
||
At BBB- and/or Baa3
|
$
|
93
|
|
Below BBB- and/or Baa3
|
$
|
1,258
|
|
|
2016
Changes
|
|
2015
Changes
|
||||
|
Fair Value
|
||||||
|
(in millions)
|
||||||
Contracts outstanding at the beginning of the period, assets (liabilities), net
|
$
|
(13
|
)
|
|
$
|
(20
|
)
|
Contracts realized or settled:
|
|
|
|
||||
Swaps realized or settled
|
(2
|
)
|
|
2
|
|
||
Options realized or settled
|
11
|
|
|
18
|
|
||
Current period changes
(*)
:
|
|
|
|
||||
Swaps
|
31
|
|
|
—
|
|
||
Options
|
9
|
|
|
(13
|
)
|
||
Contracts outstanding at the end of the period, assets (liabilities), net
|
$
|
36
|
|
|
$
|
(13
|
)
|
(*)
|
Current period changes also include the changes in fair value of new contracts entered into during the period, if any.
|
|
2016
|
|
2015
|
||
|
mmBtu Volume
|
||||
|
(in millions)
|
||||
Commodity – Natural gas swaps
|
128
|
|
|
—
|
|
Commodity – Natural gas options
|
27
|
|
|
50
|
|
Total hedge volume
|
155
|
|
|
50
|
|
|
Fair Value Measurements
December 31, 2016
|
||||||||||
|
Total
|
|
Maturity
|
||||||||
|
Fair Value
|
|
Year 1
|
|
Years 2&3
|
||||||
|
(in millions)
|
||||||||||
Level 1
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Level 2
|
36
|
|
|
28
|
|
|
8
|
|
|||
Level 3
|
—
|
|
|
—
|
|
|
—
|
|
|||
Fair value of contracts outstanding at end of period
|
$
|
36
|
|
|
$
|
28
|
|
|
$
|
8
|
|
|
2017
|
|
2018-
2019
|
|
2020-
2021
|
|
After
2021
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Long-term debt
(a)
—
|
|
|
|
|
|
|
|
|
|
||||||||||
Principal
|
$
|
450
|
|
|
$
|
1,250
|
|
|
$
|
413
|
|
|
$
|
8,533
|
|
|
$
|
10,646
|
|
Interest
|
383
|
|
|
698
|
|
|
628
|
|
|
5,112
|
|
|
6,821
|
|
|||||
Preferred and preference stock dividends
(b)
|
17
|
|
|
35
|
|
|
35
|
|
|
—
|
|
|
87
|
|
|||||
Financial derivative obligations
(c)
|
1
|
|
|
6
|
|
|
1
|
|
|
—
|
|
|
8
|
|
|||||
Operating leases
(d)
|
19
|
|
|
22
|
|
|
17
|
|
|
15
|
|
|
73
|
|
|||||
Capital leases
(d)
|
9
|
|
|
17
|
|
|
7
|
|
|
—
|
|
|
33
|
|
|||||
Purchase commitments —
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital
(e)
|
2,412
|
|
|
4,347
|
|
|
2,941
|
|
|
—
|
|
|
9,700
|
|
|||||
Fuel
(f)
|
1,628
|
|
|
1,681
|
|
|
878
|
|
|
6,320
|
|
|
10,507
|
|
|||||
Purchased power
(g)
|
320
|
|
|
595
|
|
|
539
|
|
|
2,543
|
|
|
3,997
|
|
|||||
Other
(h)
|
108
|
|
|
141
|
|
|
126
|
|
|
361
|
|
|
736
|
|
|||||
Trusts —
|
|
|
|
|
|
|
|
|
|
||||||||||
Nuclear decommissioning
(i)
|
5
|
|
|
11
|
|
|
11
|
|
|
99
|
|
|
126
|
|
|||||
Pension and other postretirement benefit plans
(j)
|
46
|
|
|
90
|
|
|
—
|
|
|
—
|
|
|
136
|
|
|||||
Total
|
$
|
5,398
|
|
|
$
|
8,893
|
|
|
$
|
5,596
|
|
|
$
|
22,983
|
|
|
$
|
42,870
|
|
(a)
|
All amounts are reflected based on final maturity dates except for amounts related to FFB borrowings. As it relates to the FFB borrowings, the final maturity date is February 20, 2044; however, principal amortization is reflected beginning in 2020. See Note 6 to the financial statements under "DOE Loan Guarantee Borrowings" for additional information. The Company plans to continue, when economically feasible, to retire higher-cost securities and replace these obligations with lower-cost capital if market conditions permit. Variable rate interest obligations are estimated based on rates as of January 1, 2017, as reflected in the statements of capitalization. Fixed rates include, where applicable, the effects of interest rate derivatives employed to manage interest rate risk. Long-term debt excludes capital lease amounts (shown separately).
|
(b)
|
Preferred and preference stock do not mature; therefore, amounts provided are for the next five years only.
|
(c)
|
Includes derivative liabilities related to energy-related derivatives. For additional information, see Notes 1 and 11 to the financial statements.
|
(d)
|
Excludes PPAs that are accounted for as leases and included in "Purchased power."
|
(e)
|
The Company provides estimated capital expenditures for a five-year period, including capital expenditures associated with environmental regulations. These amounts exclude contractual purchase commitments for nuclear fuel and capital expenditures covered under long-term service agreements which are reflected in "Fuel" and "Other," respectively. At December 31, 2016, significant purchase commitments were outstanding in connection with the construction program.
See FUTURE EARNINGS POTENTIAL – "Environmental Matters – Environmental Statutes and Regulations" and "Retail Regulatory Matters – Nuclear Construction" herein for additional information.
|
(f)
|
Includes commitments to purchase coal, nuclear fuel, and natural gas, as well as the related transportation and storage. In most cases, these contracts contain provisions for price escalation, minimum purchase levels, and other financial commitments. Natural gas purchase commitments are based on various indices at the time of delivery. Amounts reflected for natural gas purchase commitments have been estimated based on the New York Mercantile Exchange future prices at December 31, 2016.
|
(g)
|
Estimated minimum long-term obligations for various PPA purchases from gas-fired, biomass, and wind-powered facilities. Includes a total of $292 million of biomass PPAs that is contingent upon the counterparties meeting specified contract dates for commercial operation. Subsequent to December 31, 2016, the specified contract dates for commercial operation were extended from 2017 to 2019 and may change further as a result of regulatory action. See FUTURE EARNINGS POTENTIAL – "Retail Regulatory Matters – Renewables" herein for additional information.
|
(h)
|
Includes long-term service agreements and contracts for the procurement of limestone. Long-term service agreements include price escalation based on inflation indices.
|
(i)
|
Projections of nuclear decommissioning trust fund contributions for Plant Hatch and Plant Vogtle Units 1 and 2 are based on the 2013 ARP
.
See Note 1 to the financial statements under "Nuclear Decommissioning" for additional information.
|
(j)
|
The Company forecasts contributions to the pension and other postretirement benefit plans over a three-year period. The Company anticipates no mandatory contributions to the qualified pension plan during the next three years. Amounts presented represent estimated benefit payments for the nonqualified pension plans, estimated non-trust benefit payments for the other postretirement benefit plans, and estimated contributions to the other postretirement benefit plan trusts, all of which will be made from the Company's corporate assets. See Note 2 to the financial statements for additional information related to the pension and other postretirement benefit plans, including estimated benefit payments. Certain benefit payments will be made through the related benefit plans. Other benefit payments will be made from the Company's corporate assets.
|
•
|
the impact of recent and future federal and state regulatory changes, including environmental laws regulating emissions, discharges, and disposal to air, water, and land
,
and also changes in tax and other laws and regulations to which
the Company is
subject, including potential tax reform legislation, as well as changes in application of existing laws and regulations;
|
•
|
current and future litigation, regulatory investigations, proceedings, or inquiries
;
|
•
|
the effects, extent, and timing of the entry of additional competition in the markets in which
the Company operates;
|
•
|
variations in demand for
electricity,
including those relating to weather, the general economy and recovery from the last recession, population and business growth (and declines), the effects of energy conservation and efficiency measures, including from the development and deployment of alternative energy sources such as self-generation and distributed generation technologies, and any potential economic impacts resulting from federal fiscal decisions;
|
•
|
available sources and costs of
fuels;
|
•
|
effects of inflation;
|
•
|
the ability to control costs and avoid cost overruns during the development
, construction, and operation of
facilities, which include the development and construction of
generating facilities
with designs that have not been finalized or previously constructed;
|
•
|
the ability
to construct facilities in accordance with the requirements of permits and licenses,
to satisfy any environmental performance standards
and
the requirements of tax credits and other incentives
,
and to integrate facilities into the Southern Company system upon completion of construction;
|
•
|
investment performance of
the Company's
employee and retiree benefit plans
and
nuclear decommissioning trust funds;
|
•
|
advances in technology;
|
•
|
state and federal rate regulations
and the impact of pending and future rate cases and negotiations, including rate
cases related
to fuel and other cost recovery mechanisms;
|
•
|
the ability to successfully operate generating, transmission, and distribution facilities and the successful performance of necessary corporate functions;
|
•
|
legal proceedings and regulatory approvals and actions related to Plant Vogtle Units 3 and 4, including Georgia PSC approvals and NRC actions;
|
•
|
the inherent risks involved in operating
and constructing
nuclear generating facilities, including environmental, health, regulatory, natural disaster, terrorism, and financial risks;
|
•
|
internal restructuring or other restructuring options that may be pursued;
|
•
|
potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to
the Company;
|
•
|
the ability of counterparties of
the Company
to make payments as and when due and to perform as required;
|
•
|
the ability to obtain new short- and long-term contracts with wholesale customers;
|
•
|
the direct or indirect effect on the
Company's
business resulting from cyber intrusion or terrorist incidents and the threat of terrorist incidents;
|
•
|
interest rate fluctuations and financial market conditions and the results of financing efforts;
|
•
|
changes in the Company's
credit ratings, including impacts on interest rates, access to capital markets, and collateral requirements;
|
•
|
the impacts of any sovereign financial issues, including impacts on interest rates, access to capital markets, impacts on foreign currency exchange rates, counterparty performance, and the economy in general
, as well as potential impacts on the benefits of the DOE loan guarantees;
|
•
|
the ability of
the Company
to obtain additional generating capacity (or sell excess generating capacity) at competitive prices;
|
•
|
catastrophic events such as fires, earthquakes, explosions, floods, tornadoes,
hurricanes and other storms, droughts, pandemic health events such as influenzas, or other similar occurrences;
|
•
|
the direct or indirect effects on the
Company's
business resulting from incidents affecting the U.S. electric grid
or operation of generating
resources;
|
•
|
the effect of accounting pronouncements issued periodically by standard-setting bodies; and
|
•
|
other factors discussed elsewhere herein and in other reports (including the Form 10-K) filed by
the Company
from time to time with the SEC.
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
||||||
Retail revenues
|
$
|
7,772
|
|
|
$
|
7,727
|
|
|
$
|
8,240
|
|
Wholesale revenues, non-affiliates
|
175
|
|
|
215
|
|
|
335
|
|
|||
Wholesale revenues, affiliates
|
42
|
|
|
20
|
|
|
42
|
|
|||
Other revenues
|
394
|
|
|
364
|
|
|
371
|
|
|||
Total operating revenues
|
8,383
|
|
|
8,326
|
|
|
8,988
|
|
|||
Operating Expenses:
|
|
|
|
|
|
||||||
Fuel
|
1,807
|
|
|
2,033
|
|
|
2,547
|
|
|||
Purchased power, non-affiliates
|
361
|
|
|
289
|
|
|
287
|
|
|||
Purchased power, affiliates
|
518
|
|
|
575
|
|
|
701
|
|
|||
Other operations and maintenance
|
1,960
|
|
|
1,844
|
|
|
1,902
|
|
|||
Depreciation and amortization
|
855
|
|
|
846
|
|
|
846
|
|
|||
Taxes other than income taxes
|
405
|
|
|
391
|
|
|
409
|
|
|||
Total operating expenses
|
5,906
|
|
|
5,978
|
|
|
6,692
|
|
|||
Operating Income
|
2,477
|
|
|
2,348
|
|
|
2,296
|
|
|||
Other Income and (Expense):
|
|
|
|
|
|
||||||
Interest expense, net of amounts capitalized
|
(388
|
)
|
|
(363
|
)
|
|
(348
|
)
|
|||
Other income (expense), net
|
38
|
|
|
61
|
|
|
23
|
|
|||
Total other income and (expense)
|
(350
|
)
|
|
(302
|
)
|
|
(325
|
)
|
|||
Earnings Before Income Taxes
|
2,127
|
|
|
2,046
|
|
|
1,971
|
|
|||
Income taxes
|
780
|
|
|
769
|
|
|
729
|
|
|||
Net Income
|
1,347
|
|
|
1,277
|
|
|
1,242
|
|
|||
Dividends on Preferred and Preference Stock
|
17
|
|
|
17
|
|
|
17
|
|
|||
Net Income After Dividends on Preferred and Preference Stock
|
$
|
1,330
|
|
|
$
|
1,260
|
|
|
$
|
1,225
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Net Income
|
$
|
1,347
|
|
|
$
|
1,277
|
|
|
$
|
1,242
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Qualifying hedges:
|
|
|
|
|
|
||||||
Changes in fair value, net of tax of $-, $(6), and $(3),
respectively |
—
|
|
|
(9
|
)
|
|
(5
|
)
|
|||
Reclassification adjustment for amounts included in net income,
net of tax of $2, $1, and $1, respectively |
2
|
|
|
2
|
|
|
2
|
|
|||
Total other comprehensive income (loss)
|
2
|
|
|
(7
|
)
|
|
(3
|
)
|
|||
Comprehensive Income
|
$
|
1,349
|
|
|
$
|
1,270
|
|
|
$
|
1,239
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Operating Activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
1,347
|
|
|
$
|
1,277
|
|
|
$
|
1,242
|
|
Adjustments to reconcile net income
to net cash provided from operating activities — |
|
|
|
|
|
||||||
Depreciation and amortization, total
|
1,063
|
|
|
1,029
|
|
|
1,019
|
|
|||
Deferred income taxes
|
383
|
|
|
173
|
|
|
352
|
|
|||
Allowance for equity funds used during construction
|
(48
|
)
|
|
(40
|
)
|
|
(45
|
)
|
|||
Retail fuel cost over-recovery — long-term
|
—
|
|
|
106
|
|
|
(44
|
)
|
|||
Pension and postretirement funding
|
(287
|
)
|
|
(7
|
)
|
|
(156
|
)
|
|||
Settlement of asset retirement obligations
|
(123
|
)
|
|
(29
|
)
|
|
(12
|
)
|
|||
Other deferred charges — affiliated
|
(111
|
)
|
|
—
|
|
|
—
|
|
|||
Other, net
|
(10
|
)
|
|
10
|
|
|
70
|
|
|||
Changes in certain current assets and liabilities —
|
|
|
|
|
|
||||||
-Receivables
|
60
|
|
|
187
|
|
|
(248
|
)
|
|||
-Fossil fuel stock
|
104
|
|
|
37
|
|
|
303
|
|
|||
-Prepaid income taxes
|
—
|
|
|
89
|
|
|
(216
|
)
|
|||
-Other current assets
|
(38
|
)
|
|
(62
|
)
|
|
(37
|
)
|
|||
-Accounts payable
|
(42
|
)
|
|
(259
|
)
|
|
16
|
|
|||
-Accrued taxes
|
131
|
|
|
25
|
|
|
17
|
|
|||
-Accrued compensation
|
(5
|
)
|
|
(17
|
)
|
|
62
|
|
|||
-Other current liabilities
|
1
|
|
|
(2
|
)
|
|
40
|
|
|||
Net cash provided from operating activities
|
2,425
|
|
|
2,517
|
|
|
2,363
|
|
|||
Investing Activities:
|
|
|
|
|
|
||||||
Property additions
|
(2,223
|
)
|
|
(2,091
|
)
|
|
(2,023
|
)
|
|||
Nuclear decommissioning trust fund purchases
|
(808
|
)
|
|
(985
|
)
|
|
(671
|
)
|
|||
Nuclear decommissioning trust fund sales
|
803
|
|
|
980
|
|
|
669
|
|
|||
Cost of removal, net of salvage
|
(83
|
)
|
|
(71
|
)
|
|
(65
|
)
|
|||
Change in construction payables, net of joint owner portion
|
(35
|
)
|
|
217
|
|
|
(54
|
)
|
|||
Prepaid long-term service agreements
|
(34
|
)
|
|
(66
|
)
|
|
(70
|
)
|
|||
Sale of property
|
10
|
|
|
70
|
|
|
7
|
|
|||
Other investing activities
|
23
|
|
|
2
|
|
|
1
|
|
|||
Net cash used for investing activities
|
(2,347
|
)
|
|
(1,944
|
)
|
|
(2,206
|
)
|
|||
Financing Activities:
|
|
|
|
|
|
||||||
Increase (decrease) in notes payable, net
|
234
|
|
|
2
|
|
|
(891
|
)
|
|||
Proceeds —
|
|
|
|
|
|
||||||
Senior notes
|
650
|
|
|
500
|
|
|
—
|
|
|||
FFB loan
|
425
|
|
|
1,000
|
|
|
1,200
|
|
|||
Pollution control revenue bonds issuances and remarketings
|
—
|
|
|
409
|
|
|
40
|
|
|||
Capital contributions from parent company
|
594
|
|
|
62
|
|
|
549
|
|
|||
Short-term borrowings
|
—
|
|
|
250
|
|
|
—
|
|
|||
Redemptions and repurchases —
|
|
|
|
|
|
||||||
Senior notes
|
(700
|
)
|
|
(1,175
|
)
|
|
—
|
|
|||
Pollution control revenue bonds
|
(4
|
)
|
|
(268
|
)
|
|
(37
|
)
|
|||
Short-term borrowings
|
—
|
|
|
(250
|
)
|
|
—
|
|
|||
Payment of common stock dividends
|
(1,305
|
)
|
|
(1,034
|
)
|
|
(954
|
)
|
|||
Other financing activities
|
(36
|
)
|
|
(26
|
)
|
|
(70
|
)
|
|||
Net cash used for financing activities
|
(142
|
)
|
|
(530
|
)
|
|
(163
|
)
|
|||
Net Change in Cash and Cash Equivalents
|
(64
|
)
|
|
43
|
|
|
(6
|
)
|
|||
Cash and Cash Equivalents at Beginning of Year
|
67
|
|
|
24
|
|
|
30
|
|
|||
Cash and Cash Equivalents at End of Year
|
$
|
3
|
|
|
$
|
67
|
|
|
$
|
24
|
|
Supplemental Cash Flow Information:
|
|
|
|
|
|
||||||
Cash paid during the period for —
|
|
|
|
|
|
||||||
Interest (net of $20, $16, and $18 capitalized, respectively)
|
$
|
375
|
|
|
$
|
353
|
|
|
$
|
319
|
|
Income taxes (net of refunds)
|
170
|
|
|
506
|
|
|
507
|
|
|||
Noncash transactions —
|
|
|
|
|
|
||||||
Accrued property additions at year-end
|
336
|
|
|
387
|
|
|
154
|
|
|||
Capital lease obligation
|
—
|
|
|
149
|
|
|
—
|
|
Assets
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
3
|
|
|
$
|
67
|
|
Receivables —
|
|
|
|
||||
Customer accounts receivable
|
523
|
|
|
541
|
|
||
Unbilled revenues
|
224
|
|
|
188
|
|
||
Joint owner accounts receivable
|
57
|
|
|
227
|
|
||
Income taxes receivable, current
|
—
|
|
|
114
|
|
||
Other accounts and notes receivable
|
81
|
|
|
57
|
|
||
Affiliated
|
18
|
|
|
18
|
|
||
Accumulated provision for uncollectible accounts
|
(3
|
)
|
|
(2
|
)
|
||
Fossil fuel stock
|
298
|
|
|
402
|
|
||
Materials and supplies
|
479
|
|
|
449
|
|
||
Prepaid expenses
|
105
|
|
|
230
|
|
||
Other regulatory assets, current
|
193
|
|
|
213
|
|
||
Other current assets
|
38
|
|
|
19
|
|
||
Total current assets
|
2,016
|
|
|
2,523
|
|
||
Property, Plant, and Equipment:
|
|
|
|
||||
In service
|
33,841
|
|
|
31,841
|
|
||
Less accumulated provision for depreciation
|
11,317
|
|
|
10,903
|
|
||
Plant in service, net of depreciation
|
22,524
|
|
|
20,938
|
|
||
Other utility plant, net
|
—
|
|
|
171
|
|
||
Nuclear fuel, at amortized cost
|
569
|
|
|
572
|
|
||
Construction work in progress
|
4,939
|
|
|
4,775
|
|
||
Total property, plant, and equipment
|
28,032
|
|
|
26,456
|
|
||
Other Property and Investments:
|
|
|
|
||||
Equity investments in unconsolidated subsidiaries
|
60
|
|
|
64
|
|
||
Nuclear decommissioning trusts, at fair value
|
814
|
|
|
775
|
|
||
Miscellaneous property and investments
|
46
|
|
|
43
|
|
||
Total other property and investments
|
920
|
|
|
882
|
|
||
Deferred Charges and Other Assets:
|
|
|
|
||||
Deferred charges related to income taxes
|
676
|
|
|
679
|
|
||
Other regulatory assets, deferred
|
2,774
|
|
|
2,152
|
|
||
Other deferred charges and assets
|
417
|
|
|
173
|
|
||
Total deferred charges and other assets
|
3,867
|
|
|
3,004
|
|
||
Total Assets
|
$
|
34,835
|
|
|
$
|
32,865
|
|
Liabilities and Stockholder's Equity
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
||||
Securities due within one year
|
$
|
460
|
|
|
$
|
712
|
|
Notes payable
|
391
|
|
|
158
|
|
||
Accounts payable —
|
|
|
|
||||
Affiliated
|
438
|
|
|
411
|
|
||
Other
|
589
|
|
|
750
|
|
||
Customer deposits
|
265
|
|
|
264
|
|
||
Accrued taxes —
|
|
|
|
||||
Accrued income taxes
|
17
|
|
|
12
|
|
||
Other accrued taxes
|
390
|
|
|
325
|
|
||
Accrued interest
|
106
|
|
|
99
|
|
||
Accrued compensation
|
224
|
|
|
205
|
|
||
Asset retirement obligations, current
|
299
|
|
|
179
|
|
||
Other regulatory liabilities, current
|
31
|
|
|
16
|
|
||
Over recovered regulatory clause revenues, current
|
84
|
|
|
10
|
|
||
Other current liabilities
|
182
|
|
|
154
|
|
||
Total current liabilities
|
3,476
|
|
|
3,295
|
|
||
Long-Term Debt
(See accompanying statements)
|
10,225
|
|
|
9,616
|
|
||
Deferred Credits and Other Liabilities:
|
|
|
|
||||
Accumulated deferred income taxes
|
6,000
|
|
|
5,627
|
|
||
Deferred credits related to income taxes
|
121
|
|
|
105
|
|
||
Accumulated deferred investment tax credits
|
256
|
|
|
204
|
|
||
Employee benefit obligations
|
703
|
|
|
949
|
|
||
Asset retirement obligations, deferred
|
2,233
|
|
|
1,737
|
|
||
Other deferred credits and liabilities
|
199
|
|
|
347
|
|
||
Total deferred credits and other liabilities
|
9,512
|
|
|
8,969
|
|
||
Total Liabilities
|
23,213
|
|
|
21,880
|
|
||
Preferred Stock
(See accompanying statements)
|
45
|
|
|
45
|
|
||
Preference Stock
(See accompanying statements)
|
221
|
|
|
221
|
|
||
Common Stockholder's Equity
(See accompanying statements)
|
11,356
|
|
|
10,719
|
|
||
Total Liabilities and Stockholder's Equity
|
$
|
34,835
|
|
|
$
|
32,865
|
|
Commitments and Contingent Matters
(See notes)
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
|
(percent of total)
|
||||||||||
Long-Term Debt:
|
|
|
|
|
|
|
|
||||||
Long-term notes payable —
|
|
|
|
|
|
|
|
||||||
Variable rates (0.76% to 0.83% at 1/1/16) due 2016
|
$
|
—
|
|
|
$
|
450
|
|
|
|
|
|
||
3.00% due 2016
|
—
|
|
|
250
|
|
|
|
|
|
||||
5.70% due 2017
|
450
|
|
|
450
|
|
|
|
|
|
||||
1.95% to 5.40% due 2018
|
748
|
|
|
747
|
|
|
|
|
|
||||
4.25% due 2019
|
500
|
|
|
502
|
|
|
|
|
|
||||
2.40% due 2021
|
325
|
|
|
—
|
|
|
|
|
|
||||
2.85% to 5.95% due 2022-2043
|
4,175
|
|
|
3,850
|
|
|
|
|
|
||||
Total long-term notes payable
|
6,198
|
|
|
6,249
|
|
|
|
|
|
||||
Other long-term debt —
|
|
|
|
|
|
|
|
||||||
Pollution control revenue bonds —
|
|
|
|
|
|
|
|
||||||
1.38% to 4.00% due 2022-2049
|
952
|
|
|
952
|
|
|
|
|
|
||||
Variable rate (0.22% at 1/1/16) due 2016
|
—
|
|
|
4
|
|
|
|
|
|
||||
Variable rates (0.77% to 0.87% at 1/1/17) due 2022-2053
|
868
|
|
|
868
|
|
|
|
|
|
||||
FFB loans —
|
|
|
|
|
|
|
|
||||||
2.57% to 3.86% due 2020
|
44
|
|
|
37
|
|
|
|
|
|
||||
2.57% to 3.86% due 2021
|
44
|
|
|
37
|
|
|
|
|
|
||||
2.57% to 3.86% due 2022-2044
|
2,537
|
|
|
2,126
|
|
|
|
|
|
||||
Total other long-term debt
|
4,445
|
|
|
4,024
|
|
|
|
|
|
||||
Capitalized lease obligations
|
169
|
|
|
183
|
|
|
|
|
|
||||
Unamortized debt premium (discount), net
|
(10
|
)
|
|
(10
|
)
|
|
|
|
|
||||
Unamortized debt issuance expense
|
(117
|
)
|
|
(118
|
)
|
|
|
|
|
||||
Total long-term debt (annual interest requirement — $402 million)
|
10,685
|
|
|
10,328
|
|
|
|
|
|
||||
Less amount due within one year
|
460
|
|
|
712
|
|
|
|
|
|
||||
Long-term debt excluding amount due within one year
|
10,225
|
|
|
9,616
|
|
|
46.8
|
%
|
|
46.7
|
%
|
||
Preferred and Preference Stock:
|
|
|
|
|
|
|
|
||||||
Non-cumulative preferred stock
|
|
|
|
|
|
|
|
||||||
$25 par value — 6.125%
|
|
|
|
|
|
|
|
||||||
Authorized — 50,000,000 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — 1,800,000 shares
|
45
|
|
|
45
|
|
|
|
|
|
||||
Non-cumulative preference stock
|
|
|
|
|
|
|
|
||||||
$100 par value — 6.50%
|
|
|
|
|
|
|
|
||||||
Authorized — 15,000,000 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — 2,250,000 shares
|
221
|
|
|
221
|
|
|
|
|
|
||||
Total preferred and preference stock
(annual dividend requirement — $17 million) |
266
|
|
|
266
|
|
|
1.2
|
|
|
1.3
|
|
||
Common Stockholder's Equity:
|
|
|
|
|
|
|
|
||||||
Common stock, without par value —
|
|
|
|
|
|
|
|
||||||
Authorized — 20,000,000 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — 9,261,500 shares
|
398
|
|
|
398
|
|
|
|
|
|
||||
Paid-in capital
|
6,885
|
|
|
6,275
|
|
|
|
|
|
||||
Retained earnings
|
4,086
|
|
|
4,061
|
|
|
|
|
|
||||
Accumulated other comprehensive loss
|
(13
|
)
|
|
(15
|
)
|
|
|
|
|
||||
Total common stockholder's equity
|
11,356
|
|
|
10,719
|
|
|
52.0
|
|
|
52.0
|
|
||
Total Capitalization
|
$
|
21,847
|
|
|
$
|
20,601
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Number of Common Shares Issued
|
|
Common Stock
|
|
Paid-In Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total
|
|||||||||||
|
(in millions)
|
|||||||||||||||||||||
Balance at December 31, 2013
|
9
|
|
|
$
|
398
|
|
|
$
|
5,633
|
|
|
$
|
3,565
|
|
|
$
|
(5
|
)
|
|
$
|
9,591
|
|
Net income after dividends on preferred
and preference stock
|
—
|
|
|
—
|
|
|
—
|
|
|
1,225
|
|
|
—
|
|
|
1,225
|
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
563
|
|
|
—
|
|
|
—
|
|
|
563
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
|||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(954
|
)
|
|
—
|
|
|
(954
|
)
|
|||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Balance at December 31, 2014
|
9
|
|
|
398
|
|
|
6,196
|
|
|
3,835
|
|
|
(8
|
)
|
|
10,421
|
|
|||||
Net income after dividends on preferred
and preference stock
|
—
|
|
|
—
|
|
|
—
|
|
|
1,260
|
|
|
—
|
|
|
1,260
|
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
79
|
|
|
—
|
|
|
—
|
|
|
79
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
(7
|
)
|
|||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,034
|
)
|
|
—
|
|
|
(1,034
|
)
|
|||||
Balance at December 31, 2015
|
9
|
|
|
398
|
|
|
6,275
|
|
|
4,061
|
|
|
(15
|
)
|
|
10,719
|
|
|||||
Net income after dividends on preferred
and preference stock
|
—
|
|
|
—
|
|
|
—
|
|
|
1,330
|
|
|
—
|
|
|
1,330
|
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
610
|
|
|
—
|
|
|
—
|
|
|
610
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,305
|
)
|
|
—
|
|
|
(1,305
|
)
|
|||||
Balance at December 31, 2016
|
9
|
|
|
$
|
398
|
|
|
$
|
6,885
|
|
|
$
|
4,086
|
|
|
$
|
(13
|
)
|
|
$
|
11,356
|
|
Note
|
|
Page
|
1
|
||
2
|
||
3
|
||
4
|
||
5
|
||
6
|
||
7
|
||
8
|
||
9
|
||
10
|
||
11
|
||
12
|
|
2016
|
|
2015
|
|
Note
|
||||
|
(in millions)
|
|
|
||||||
Retiree benefit plans
|
$
|
1,348
|
|
|
$
|
1,307
|
|
|
(a, j)
|
Deferred income tax charges
|
681
|
|
|
683
|
|
|
(b, j)
|
||
Loss on reacquired debt
|
137
|
|
|
150
|
|
|
(c, j)
|
||
Asset retirement obligations
|
893
|
|
|
411
|
|
|
(b, j)
|
||
Vacation pay
|
91
|
|
|
91
|
|
|
(d, j)
|
||
Cancelled construction projects
|
44
|
|
|
56
|
|
|
(e)
|
||
Remaining net book value of retired assets
|
166
|
|
|
171
|
|
|
(f)
|
||
Storm damage reserves
|
206
|
|
|
92
|
|
|
(g)
|
||
Other regulatory assets
|
97
|
|
|
110
|
|
|
(h)
|
||
Other cost of removal obligations
|
3
|
|
|
(31
|
)
|
|
(b)
|
||
Deferred income tax credits
|
(121
|
)
|
|
(105
|
)
|
|
(b, j)
|
||
Other regulatory liabilities
|
(39
|
)
|
|
(2
|
)
|
|
(i, j)
|
||
Total regulatory assets (liabilities), net
|
$
|
3,506
|
|
|
$
|
2,933
|
|
|
|
(a)
|
Recovered and amortized over the average remaining service period which may range up to
13 years
. See Note 2 for additional information.
|
(b)
|
Asset retirement and other cost of removal obligations and deferred income tax assets are recovered, and deferred income tax liabilities are amortized over the related property lives, which may range up to
70 years
. Asset retirement and removal liabilities will be settled and trued up following completion of the related activities. Included in the deferred income tax assets is
$26 million
for the retiree Medicare drug subsidy, which is recovered and amortized, as approved by the Georgia PSC, through 2022.
|
(c)
|
Recovered over either the remaining life of the original issue or, if refinanced, over the remaining life of the new issue, which currently does not exceed
36 years
.
|
(d)
|
Recorded as earned by employees and recovered as paid, generally within
one year
. This includes both vacation and banked holiday pay.
|
(e)
|
Costs associated with construction of environmental controls that will not be completed as a result of unit retirements are being amortized as approved by the Georgia PSC over periods not exceeding
nine years
or through 2022.
|
(f)
|
Amortized as approved by the Georgia PSC over periods not exceeding
10 years
or through 2024. The net book value of Plant Mitchell Unit 3 at December 31, 2016 was
$12 million
, which will continue to be amortized through December 31, 2019 as provided in the 2013 ARP. Amortization of the remaining net book value of Plant Mitchell Unit 3 at December 31, 2019, which is expected to be approximately
$5 million
, and
$31 million
related to obsolete inventories of certain retired units will be determined by the Georgia PSC in the 2019 base rate case. See Note 3 under "Retail Regulatory Matters – Integrated Resource Plan" for additional information.
|
(g)
|
Previous under-recovery as of December 2013 is recorded and recovered or amortized as approved by the Georgia PSC through 2019. Amortization of
$185 million
related to the under-recovery from January 2014 through December 2016 will be determined by the Georgia PSC in the 2019 base rate case. See Note 3 for additional information.
|
(h)
|
Comprised of several components including deferred nuclear outages, environmental remediation, building lease, and demand-side management tariff under-recovery. Deferred nuclear outages are recorded and recovered or amortized over the outage cycles of each nuclear unit, which does not exceed
24 months
. The building lease is recorded and recovered or amortized as approved by the Georgia PSC through 2020. The amortization of environmental remediation and demand-side management tariff under-recovery of
$46 million
at December 31, 2016 will be determined by the Georgia PSC in the 2019 base rate case.
|
(i)
|
Comprised primarily of fuel-hedging gains, which upon final settlement are refunded through the Company's fuel cost recovery mechanism.
|
(j)
|
Generally not earning a return as they are excluded from rate base or are offset in rate base by a corresponding asset or liability.
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Generation
|
$
|
16,668
|
|
|
$
|
15,386
|
|
Transmission
|
5,779
|
|
|
5,355
|
|
||
Distribution
|
9,553
|
|
|
9,151
|
|
||
General
|
1,813
|
|
|
1,921
|
|
||
Plant acquisition adjustment
|
28
|
|
|
28
|
|
||
Total plant in service
|
$
|
33,841
|
|
|
$
|
31,841
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Balance at beginning of year
|
$
|
1,916
|
|
|
$
|
1,255
|
|
Liabilities incurred
|
—
|
|
|
6
|
|
||
Liabilities settled
|
(123
|
)
|
|
(30
|
)
|
||
Accretion
|
77
|
|
|
56
|
|
||
Cash flow revisions
|
662
|
|
|
629
|
|
||
Balance at end of year
|
$
|
2,532
|
|
|
$
|
1,916
|
|
|
Plant Hatch
|
|
Plant Vogtle
Units 1 and 2
|
||||
Decommissioning periods:
|
|
|
|
||||
Beginning year
|
2034
|
|
|
2047
|
|
||
Completion year
|
2075
|
|
|
2079
|
|
||
|
(in millions)
|
||||||
Site study costs:
|
|
||||||
Radiated structures
|
$
|
678
|
|
|
$
|
568
|
|
Spent fuel management
|
160
|
|
|
147
|
|
||
Non-radiated structures
|
64
|
|
|
89
|
|
||
Total site study costs
|
$
|
902
|
|
|
$
|
804
|
|
External trust funds
|
$
|
511
|
|
|
$
|
303
|
|
Assumptions used to determine net periodic costs:
|
2016
|
|
2015
|
|
2014
|
|||
Pension plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.65
|
%
|
|
4.18
|
%
|
|
5.02
|
%
|
Discount rate – interest costs
|
3.86
|
|
|
4.18
|
|
|
5.02
|
|
Discount rate – service costs
|
5.03
|
|
|
4.49
|
|
|
5.02
|
|
Expected long-term return on plan assets
|
8.20
|
|
|
8.20
|
|
|
8.20
|
|
Annual salary increase
|
4.46
|
|
|
3.59
|
|
|
3.59
|
|
Other postretirement benefit plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.49
|
%
|
|
4.03
|
%
|
|
4.85
|
%
|
Discount rate – interest costs
|
3.67
|
|
|
4.03
|
|
|
4.85
|
|
Discount rate – service costs
|
4.88
|
|
|
4.39
|
|
|
4.85
|
|
Expected long-term return on plan assets
|
6.27
|
|
|
6.48
|
|
|
6.75
|
|
Annual salary increase
|
4.46
|
|
|
3.59
|
|
|
3.59
|
|
Assumptions used to determine benefit obligations:
|
2016
|
|
2015
|
||
Pension plans
|
|
|
|
||
Discount rate
|
4.40
|
%
|
|
4.65
|
%
|
Annual salary increase
|
4.46
|
|
|
4.46
|
|
Other postretirement benefit plans
|
|
|
|
||
Discount rate
|
4.23
|
%
|
|
4.49
|
%
|
Annual salary increase
|
4.46
|
|
|
4.46
|
|
|
Initial Cost Trend Rate
|
|
Ultimate Cost Trend Rate
|
|
Year That Ultimate Rate is Reached
|
||
Pre-65
|
6.50
|
%
|
|
4.50
|
%
|
|
2025
|
Post-65 medical
|
5.00
|
|
|
4.50
|
|
|
2025
|
Post-65 prescription
|
10.00
|
|
|
4.50
|
|
|
2025
|
|
1 Percent
Increase
|
|
1 Percent
Decrease
|
||||
|
(in millions)
|
||||||
Benefit obligation
|
$
|
55
|
|
|
$
|
48
|
|
Service and interest costs
|
2
|
|
|
2
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
3,615
|
|
|
$
|
3,781
|
|
Service cost
|
70
|
|
|
73
|
|
||
Interest cost
|
136
|
|
|
154
|
|
||
Benefits paid
|
(164
|
)
|
|
(188
|
)
|
||
Actuarial (gain) loss
|
143
|
|
|
(205
|
)
|
||
Balance at end of year
|
3,800
|
|
|
3,615
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
3,196
|
|
|
3,383
|
|
||
Actual return (loss) on plan assets
|
288
|
|
|
(13
|
)
|
||
Employer contributions
|
301
|
|
|
14
|
|
||
Benefits paid
|
(164
|
)
|
|
(188
|
)
|
||
Fair value of plan assets at end of year
|
3,621
|
|
|
3,196
|
|
||
Accrued liability
|
$
|
(179
|
)
|
|
$
|
(419
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
1,129
|
|
|
$
|
1,076
|
|
Other current liabilities
|
(14
|
)
|
|
(13
|
)
|
||
Employee benefit obligations
|
(165
|
)
|
|
(406
|
)
|
|
2016
|
|
2015
|
|
Estimated
Amortization
in 2017
|
||||||
|
(in millions)
|
||||||||||
Prior service cost
|
$
|
17
|
|
|
$
|
8
|
|
|
$
|
3
|
|
Net (gain) loss
|
1,112
|
|
|
1,068
|
|
|
57
|
|
|||
Regulatory assets
|
$
|
1,129
|
|
|
$
|
1,076
|
|
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Regulatory assets:
|
|
|
|
||||
Beginning balance
|
$
|
1,076
|
|
|
$
|
1,102
|
|
Net (gain) loss
|
99
|
|
|
59
|
|
||
Change in prior service costs
|
14
|
|
|
—
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
(5
|
)
|
|
(9
|
)
|
||
Amortization of net gain (loss)
|
(55
|
)
|
|
(76
|
)
|
||
Total reclassification adjustments
|
(60
|
)
|
|
(85
|
)
|
||
Total change
|
53
|
|
|
(26
|
)
|
||
Ending balance
|
$
|
1,129
|
|
|
$
|
1,076
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
70
|
|
|
$
|
73
|
|
|
$
|
62
|
|
Interest cost
|
136
|
|
|
154
|
|
|
153
|
|
|||
Expected return on plan assets
|
(258
|
)
|
|
(251
|
)
|
|
(228
|
)
|
|||
Recognized net (gain) loss
|
55
|
|
|
76
|
|
|
41
|
|
|||
Net amortization
|
5
|
|
|
9
|
|
|
10
|
|
|||
Net periodic pension cost
|
$
|
8
|
|
|
$
|
61
|
|
|
$
|
38
|
|
|
Benefit
Payments
|
||
|
(in millions)
|
||
2017
|
$
|
184
|
|
2018
|
190
|
|
|
2019
|
196
|
|
|
2020
|
202
|
|
|
2021
|
206
|
|
|
2022 to 2026
|
1,126
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
854
|
|
|
$
|
864
|
|
Service cost
|
6
|
|
|
7
|
|
||
Interest cost
|
30
|
|
|
34
|
|
||
Benefits paid
|
(45
|
)
|
|
(45
|
)
|
||
Actuarial (gain) loss
|
(1
|
)
|
|
(22
|
)
|
||
Plan amendment
|
—
|
|
|
12
|
|
||
Retiree drug subsidy
|
3
|
|
|
4
|
|
||
Balance at end of year
|
847
|
|
|
854
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
358
|
|
|
395
|
|
||
Actual return (loss) on plan assets
|
21
|
|
|
(6
|
)
|
||
Employer contributions
|
17
|
|
|
10
|
|
||
Benefits paid
|
(42
|
)
|
|
(41
|
)
|
||
Fair value of plan assets at end of year
|
354
|
|
|
358
|
|
||
Accrued liability
|
$
|
(493
|
)
|
|
$
|
(496
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
213
|
|
|
$
|
223
|
|
Employee benefit obligations
|
(493
|
)
|
|
(496
|
)
|
|
2016
|
|
2015
|
|
Estimated
Amortization
in 2017
|
||||||
|
(in millions)
|
||||||||||
Prior service cost
|
$
|
6
|
|
|
$
|
8
|
|
|
$
|
1
|
|
Net (gain) loss
|
207
|
|
|
215
|
|
|
8
|
|
|||
Regulatory assets
|
$
|
213
|
|
|
$
|
223
|
|
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Regulatory assets:
|
|
|
|
||||
Beginning balance
|
$
|
223
|
|
|
$
|
213
|
|
Net (gain) loss
|
—
|
|
|
9
|
|
||
Change in prior service costs
|
—
|
|
|
12
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
(1
|
)
|
|
—
|
|
||
Amortization of net gain (loss)
|
(9
|
)
|
|
(11
|
)
|
||
Total reclassification adjustments
|
(10
|
)
|
|
(11
|
)
|
||
Total change
|
(10
|
)
|
|
10
|
|
||
Ending balance
|
$
|
213
|
|
|
$
|
223
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
6
|
|
|
$
|
7
|
|
|
$
|
6
|
|
Interest cost
|
30
|
|
|
34
|
|
|
34
|
|
|||
Expected return on plan assets
|
(22
|
)
|
|
(24
|
)
|
|
(25
|
)
|
|||
Net amortization
|
10
|
|
|
11
|
|
|
2
|
|
|||
Net periodic postretirement benefit cost
|
$
|
24
|
|
|
$
|
28
|
|
|
$
|
17
|
|
|
Benefit
Payments
|
|
Subsidy
Receipts
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
2017
|
$
|
54
|
|
|
$
|
(4
|
)
|
|
$
|
50
|
|
2018
|
56
|
|
|
(5
|
)
|
|
51
|
|
|||
2019
|
58
|
|
|
(5
|
)
|
|
53
|
|
|||
2020
|
59
|
|
|
(5
|
)
|
|
54
|
|
|||
2021
|
60
|
|
|
(6
|
)
|
|
54
|
|
|||
2022 to 2026
|
303
|
|
|
(32
|
)
|
|
271
|
|
|
Target
|
|
2016
|
|
2015
|
|||
Pension plan assets:
|
|
|
|
|
|
|||
Domestic equity
|
26
|
%
|
|
29
|
%
|
|
30
|
%
|
International equity
|
25
|
|
|
22
|
|
|
23
|
|
Fixed income
|
23
|
|
|
29
|
|
|
23
|
|
Special situations
|
3
|
|
|
2
|
|
|
2
|
|
Real estate investments
|
14
|
|
|
13
|
|
|
16
|
|
Private equity
|
9
|
|
|
5
|
|
|
6
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Other postretirement benefit plan assets:
|
|
|
|
|
|
|||
Domestic equity
|
36
|
%
|
|
35
|
%
|
|
34
|
%
|
International equity
|
24
|
|
|
24
|
|
|
27
|
|
Domestic fixed income
|
33
|
|
|
35
|
|
|
25
|
|
Global fixed income
|
|
|
|
|
|
|
8
|
|
Special situations
|
1
|
|
|
1
|
|
|
—
|
|
Real estate investments
|
4
|
|
|
4
|
|
|
4
|
|
Private equity
|
2
|
|
|
1
|
|
|
2
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
•
|
Domestic equity.
A mix of large and small capitalization stocks with generally an equal distribution of value and growth attributes, managed both actively and through passive index approaches.
|
•
|
International equity.
A mix of growth stocks and value stocks with both developed and emerging market exposure, managed both actively and through passive index approaches.
|
•
|
Fixed income.
A mix of domestic and international bonds.
|
•
|
Trust-owned life insurance (TOLI).
Investments of the Company's taxable trusts aimed at minimizing the impact of taxes on the portfolio.
|
•
|
Special situations.
Investments in opportunistic strategies with the objective of diversifying and enhancing returns and exploiting short-term inefficiencies as well as investments in promising new strategies of a longer-term nature.
|
•
|
Real estate investments.
Investments in traditional private market, equity-oriented investments in real properties (indirectly through pooled funds or partnerships) and in publicly traded real estate securities.
|
•
|
Private equity.
Investments in private partnerships that invest in private or public securities typically through privately-negotiated and/or structured transactions, including leveraged buyouts, venture capital, and distressed debt.
|
•
|
Domestic and international equity.
Investments in equity securities such as common stocks, American depositary receipts, and real estate investment trusts that trade on a public exchange are classified as Level 1 investments and are valued at the closing price in the active market. Equity investments with unpublished prices (i.e. pooled funds) are valued as Level 2, when the underlying holdings used to value the investment are comprised of Level 1 or Level 2 equity securities.
|
•
|
Fixed income.
Investments in fixed income securities are generally classified as Level 2 investments and are valued based on prices reported in the market place. Additionally, the value of fixed income securities takes into consideration certain items such as broker quotes, spreads, yield curves, interest rates, and discount rates that apply to the term of a specific instrument.
|
•
|
TOLI.
Investments in TOLI policies are classified as Level 2 investments and are valued based on the underlying investments held in the policy's separate account. The underlying assets are equity and fixed income pooled funds that are comprised of Level 1 and Level 2 securities.
|
•
|
Real estate investments, private equity, and special situations investments.
Investments in real estate, private equity, and special situations are generally classified as Net Asset Value as a Practical Expedient, since the underlying assets typically do not have publicly available observable inputs. The fund manager values the assets using various inputs and techniques depending on the nature of the underlying investments. Techniques may include purchase multiples for comparable transactions, comparable public company trading multiples, discounted cash flow analysis, prevailing market capitalization rates, recent sales of comparable investments, and independent third-party appraisals. The fair value of partnerships is determined by aggregating the value of the underlying assets less liabilities.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
686
|
|
|
$
|
317
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,003
|
|
International equity
(*)
|
420
|
|
|
380
|
|
|
—
|
|
|
—
|
|
|
800
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
201
|
|
|
—
|
|
|
—
|
|
|
201
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Corporate bonds
|
—
|
|
|
338
|
|
|
—
|
|
|
—
|
|
|
338
|
|
|||||
Pooled funds
|
—
|
|
|
179
|
|
|
—
|
|
|
—
|
|
|
179
|
|
|||||
Cash equivalents and other
|
340
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
341
|
|
|||||
Real estate investments
|
106
|
|
|
—
|
|
|
—
|
|
|
394
|
|
|
500
|
|
|||||
Special situations
|
—
|
|
|
—
|
|
|
—
|
|
|
61
|
|
|
61
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
188
|
|
|
188
|
|
|||||
Total
|
$
|
1,552
|
|
|
$
|
1,420
|
|
|
$
|
—
|
|
|
$
|
643
|
|
|
$
|
3,615
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
565
|
|
|
$
|
236
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
801
|
|
International equity
(*)
|
412
|
|
|
343
|
|
|
—
|
|
|
—
|
|
|
755
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
157
|
|
|
—
|
|
|
—
|
|
|
157
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
69
|
|
|
—
|
|
|
—
|
|
|
69
|
|
|||||
Corporate bonds
|
—
|
|
|
394
|
|
|
—
|
|
|
—
|
|
|
394
|
|
|||||
Pooled funds
|
—
|
|
|
173
|
|
|
—
|
|
|
—
|
|
|
173
|
|
|||||
Cash equivalents and other
|
—
|
|
|
50
|
|
|
—
|
|
|
—
|
|
|
50
|
|
|||||
Real estate investments
|
103
|
|
|
—
|
|
|
—
|
|
|
421
|
|
|
524
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
220
|
|
|
220
|
|
|||||
Total
|
$
|
1,080
|
|
|
$
|
1,422
|
|
|
$
|
—
|
|
|
$
|
641
|
|
|
$
|
3,143
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
45
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
54
|
|
International equity
(*)
|
11
|
|
|
37
|
|
|
—
|
|
|
—
|
|
|
48
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Corporate bonds
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|||||
Pooled funds
|
—
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
38
|
|
|||||
Cash equivalents and other
|
15
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|||||
Trust-owned life insurance
|
—
|
|
|
162
|
|
|
—
|
|
|
—
|
|
|
162
|
|
|||||
Real estate investments
|
3
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
14
|
|
|||||
Special situations
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
5
|
|
|||||
Total
|
$
|
74
|
|
|
$
|
260
|
|
|
$
|
—
|
|
|
$
|
18
|
|
|
$
|
352
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
30
|
|
|
$
|
36
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
66
|
|
International equity
(*)
|
12
|
|
|
41
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Corporate bonds
|
—
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|||||
Pooled funds
|
—
|
|
|
30
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|||||
Cash equivalents and other
|
10
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
16
|
|
|||||
Trust-owned life insurance
|
—
|
|
|
158
|
|
|
—
|
|
|
—
|
|
|
158
|
|
|||||
Real estate investments
|
3
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
15
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
|||||
Total
|
$
|
55
|
|
|
$
|
290
|
|
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
364
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
Facility (Type)
|
Company Ownership
|
|
Plant in Service
|
|
Accumulated Depreciation
|
|
CWIP
|
|||||||
|
|
|
(in millions)
|
|||||||||||
Plant Vogtle (nuclear)
|
|
|
|
|
|
|
|
|||||||
Units 1 and 2
|
45.7
|
%
|
|
$
|
3,545
|
|
|
$
|
2,111
|
|
|
$
|
74
|
|
Plant Hatch (nuclear)
|
50.1
|
|
|
1,297
|
|
|
585
|
|
|
81
|
|
|||
Plant Wansley (coal)
|
53.5
|
|
|
1,046
|
|
|
308
|
|
|
12
|
|
|||
Plant Scherer (coal)
|
|
|
|
|
|
|
|
|||||||
Units 1 and 2
|
8.4
|
|
|
258
|
|
|
90
|
|
|
3
|
|
|||
Unit 3
|
75.0
|
|
|
1,203
|
|
|
458
|
|
|
23
|
|
|||
Rocky Mountain (pumped storage)
|
25.4
|
|
|
181
|
|
|
129
|
|
|
—
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Federal –
|
|
|
|
|
|
||||||
Current
|
$
|
391
|
|
|
$
|
515
|
|
|
$
|
295
|
|
Deferred
|
319
|
|
|
176
|
|
|
366
|
|
|||
|
710
|
|
|
691
|
|
|
661
|
|
|||
State –
|
|
|
|
|
|
||||||
Current
|
6
|
|
|
81
|
|
|
82
|
|
|||
Deferred
|
64
|
|
|
(3
|
)
|
|
(14
|
)
|
|||
|
70
|
|
|
78
|
|
|
68
|
|
|||
Total
|
$
|
780
|
|
|
$
|
769
|
|
|
$
|
729
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Deferred tax liabilities –
|
|
|
|
||||
Accelerated depreciation
|
$
|
5,266
|
|
|
$
|
4,909
|
|
Property basis differences
|
957
|
|
|
1,003
|
|
||
Employee benefit obligations
|
428
|
|
|
310
|
|
||
Premium on reacquired debt
|
56
|
|
|
61
|
|
||
Regulatory assets –
|
|
|
|
||||
Storm damage reserves
|
83
|
|
|
37
|
|
||
Employee benefit obligations
|
546
|
|
|
528
|
|
||
Asset retirement obligations
|
726
|
|
|
545
|
|
||
Retired assets
|
55
|
|
|
58
|
|
||
Asset retirement obligations
|
182
|
|
|
161
|
|
||
Other
|
83
|
|
|
92
|
|
||
Total
|
8,382
|
|
|
7,704
|
|
||
Deferred tax assets –
|
|
|
|
||||
Federal effect of state deferred taxes
|
173
|
|
|
150
|
|
||
Employee benefit obligations
|
661
|
|
|
642
|
|
||
Other property basis differences
|
105
|
|
|
88
|
|
||
Other deferred costs
|
100
|
|
|
83
|
|
||
State investment tax credit carryforward
|
201
|
|
|
216
|
|
||
Federal tax credit carryforward
|
84
|
|
|
3
|
|
||
Unbilled fuel revenue
|
47
|
|
|
47
|
|
||
Regulatory liabilities associated with asset retirement obligations
|
33
|
|
|
60
|
|
||
Asset retirement obligations
|
908
|
|
|
706
|
|
||
Other
|
70
|
|
|
82
|
|
||
Total
|
2,382
|
|
|
2,077
|
|
||
Accumulated deferred income taxes
|
$
|
6,000
|
|
|
$
|
5,627
|
|
|
2016
|
|
2015
|
|
2014
|
|||
Federal statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income tax, net of federal deduction
|
2.1
|
|
|
2.5
|
|
|
2.2
|
|
Non-deductible book depreciation
|
0.8
|
|
|
1.2
|
|
|
1.3
|
|
AFUDC equity
|
(0.8
|
)
|
|
(0.7
|
)
|
|
(0.8
|
)
|
Other
|
(0.4
|
)
|
|
(0.4
|
)
|
|
(0.7
|
)
|
Effective income tax rate
|
36.7
|
%
|
|
37.6
|
%
|
|
37.0
|
%
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Senior notes
|
$
|
450
|
|
|
$
|
700
|
|
Pollution control revenue bonds
|
—
|
|
|
4
|
|
||
Capital leases
|
10
|
|
|
8
|
|
||
Total
|
$
|
460
|
|
|
$
|
712
|
|
|
Commercial Paper at the End of the Period
|
|||||
|
Amount
Outstanding
|
|
Weighted Average Interest Rate
|
|||
|
(in millions)
|
|
|
|||
December 31, 2016
|
$
|
392
|
|
|
1.1
|
%
|
December 31, 2015
|
$
|
158
|
|
|
0.6
|
%
|
|
Affiliate Capital Leases
|
|
Affiliate Operating Leases
|
|
Non-Affiliate
Operating
Leases
(c)
|
|
Vogtle
Units 1 and 2
Capacity
Payments
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
2017
|
$
|
22
|
|
|
$
|
72
|
|
|
$
|
123
|
|
|
$
|
8
|
|
|
$
|
225
|
|
2018
|
22
|
|
|
63
|
|
|
126
|
|
|
7
|
|
|
218
|
|
|||||
2019
|
23
|
|
|
64
|
|
|
127
|
|
|
6
|
|
|
220
|
|
|||||
2020
|
23
|
|
|
65
|
|
|
123
|
|
|
5
|
|
|
216
|
|
|||||
2021
|
24
|
|
|
66
|
|
|
124
|
|
|
5
|
|
|
219
|
|
|||||
2022 and thereafter
|
204
|
|
|
479
|
|
|
882
|
|
|
43
|
|
|
1,608
|
|
|||||
Total
|
$
|
318
|
|
|
$
|
809
|
|
|
$
|
1,505
|
|
|
$
|
74
|
|
|
$
|
2,706
|
|
Less: amounts representing executory costs
(a)
|
48
|
|
|
|
|
|
|
|
|
|
|||||||||
Net minimum lease payments
|
270
|
|
|
|
|
|
|
|
|
|
|||||||||
Less: amounts representing interest
(b)
|
128
|
|
|
|
|
|
|
|
|
|
|||||||||
Present value of net minimum lease payments
|
$
|
142
|
|
|
|
|
|
|
|
|
|
(a)
|
Executory costs such as taxes, maintenance, and insurance (including the estimated profit thereon)
a
re estimated and included in total minimum lease payments.
|
(b)
|
Calculated using an adjusted incremental borrowing rate to reduce the present value of the net minimum lease payments to fair value.
|
(c)
|
A total of
$197 million
of biomass PPAs included under the non-affiliate operating leases is contingent upon the counterparties meeting specified contract dates for commercial operation. Subsequent to December 31, 2016, the specified contract dates for commercial operation were extended from 2017 to 2019 and may change further as a result of regulatory action.
|
|
Minimum Lease Payments
|
||||||||||
|
Railcars
|
|
Other
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
2017
|
$
|
12
|
|
|
$
|
7
|
|
|
$
|
19
|
|
2018
|
6
|
|
|
7
|
|
|
13
|
|
|||
2019
|
3
|
|
|
6
|
|
|
9
|
|
|||
2020
|
3
|
|
|
6
|
|
|
9
|
|
|||
2021
|
2
|
|
|
6
|
|
|
8
|
|
|||
2022 and thereafter
|
2
|
|
|
13
|
|
|
15
|
|
|||
Total
|
$
|
28
|
|
|
$
|
45
|
|
|
$
|
73
|
|
•
|
Level 1 consists of observable market data in an active market for identical assets or liabilities.
|
•
|
Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.
|
•
|
Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
|
||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
44
|
|
|
$
|
—
|
|
|
$
|
44
|
|
Interest rate derivatives
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||
Nuclear decommissioning trusts:
(*)
|
|
|
|
|
|
|
|
||||||||
Domestic equity
|
204
|
|
|
1
|
|
|
—
|
|
|
205
|
|
||||
Foreign equity
|
—
|
|
|
121
|
|
|
—
|
|
|
121
|
|
||||
U.S. Treasury and government agency securities
|
—
|
|
|
71
|
|
|
—
|
|
|
71
|
|
||||
Municipal bonds
|
—
|
|
|
73
|
|
|
—
|
|
|
73
|
|
||||
Corporate bonds
|
—
|
|
|
164
|
|
|
—
|
|
|
164
|
|
||||
Mortgage and asset backed securities
|
—
|
|
|
164
|
|
|
—
|
|
|
164
|
|
||||
Other
|
11
|
|
|
5
|
|
|
—
|
|
|
16
|
|
||||
Total
|
$
|
215
|
|
|
$
|
645
|
|
|
$
|
—
|
|
|
$
|
860
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
8
|
|
Interest rate derivatives
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
||||
Total
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
11
|
|
(*)
|
Includes the investment securities pledged to creditors and collateral received, and excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases and the lending pool. See Note 1 under "Nuclear Decommissioning" for additional information.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
|
||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Interest rate derivatives
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||
Nuclear decommissioning trusts:
(*)
|
|
|
|
|
|
|
|
||||||||
Domestic equity
|
182
|
|
|
1
|
|
|
—
|
|
|
183
|
|
||||
Foreign equity
|
—
|
|
|
113
|
|
|
—
|
|
|
113
|
|
||||
U.S. Treasury and government agency securities
|
—
|
|
|
125
|
|
|
—
|
|
|
125
|
|
||||
Municipal bonds
|
—
|
|
|
64
|
|
|
—
|
|
|
64
|
|
||||
Corporate bonds
|
—
|
|
|
143
|
|
|
—
|
|
|
143
|
|
||||
Mortgage and asset backed securities
|
—
|
|
|
127
|
|
|
—
|
|
|
127
|
|
||||
Other
|
16
|
|
|
4
|
|
|
—
|
|
|
20
|
|
||||
Cash equivalents
|
63
|
|
|
—
|
|
|
—
|
|
|
63
|
|
||||
Total
|
$
|
261
|
|
|
$
|
584
|
|
|
$
|
—
|
|
|
$
|
845
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
15
|
|
Interest rate derivatives
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||
Total
|
$
|
—
|
|
|
$
|
21
|
|
|
$
|
—
|
|
|
$
|
21
|
|
(*)
|
Includes the investment securities pledged to creditors and collateral received, and excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases and the lending pool. See Note 1 under "Nuclear Decommissioning" for additional information.
|
|
Carrying
Amount
|
|
Fair
Value
|
||||
|
(in millions)
|
||||||
Long-term debt, including securities due within one year:
|
|
|
|
||||
2016
|
$
|
10,516
|
|
|
$
|
11,034
|
|
2015
|
$
|
10,145
|
|
|
$
|
10,480
|
|
•
|
Regulatory Hedges
– Energy-related derivative contracts which are designated as regulatory hedges relate primarily to the Company's fuel-hedging program, where gains and losses are initially recorded as regulatory liabilities and assets, respectively, and then are included in fuel expense as the underlying fuel is used in operations and ultimately recovered through the fuel cost recovery mechanism.
|
•
|
Not Designated
– Gains and losses on energy-related derivative contracts that are not designated or fail to qualify as hedges are recognized in the statements of income as incurred.
|
|
Notional
Amount |
|
Interest
Rate Received |
|
Weighted Average Interest
Rate Paid |
|
Hedge
Maturity Date |
|
Fair Value
Gain (Loss) December 31, 2016 |
||||
|
(in millions)
|
|
|
|
|
|
|
|
(in millions)
|
||||
Fair Value Hedges of Existing Debt
|
|
|
|
|
|
|
|
|
|
||||
|
$
|
250
|
|
|
5.40%
|
|
3-month LIBOR + 4.02%
|
|
June 2018
|
|
$
|
—
|
|
|
500
|
|
|
1.95%
|
|
3-month LIBOR + 0.76%
|
|
December 2018
|
|
(2
|
)
|
||
|
200
|
|
|
4.25%
|
|
3-month LIBOR + 2.46%
|
|
December 2019
|
|
1
|
|
||
Total
|
$
|
950
|
|
|
|
|
|
|
|
|
$
|
(1
|
)
|
|
2016
|
|
2015
|
||||||||||
Derivative Category and Balance Sheet Location
|
Assets
|
Liabilities
|
|
Assets
|
Liabilities
|
||||||||
|
(in millions)
|
||||||||||||
Derivatives designated as hedging instruments for regulatory purposes
|
|
|
|
|
|
||||||||
Energy-related derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
$
|
30
|
|
$
|
1
|
|
|
$
|
2
|
|
$
|
12
|
|
Other deferred charges and assets/Other deferred credits and liabilities
|
14
|
|
7
|
|
|
—
|
|
3
|
|
||||
Total derivatives designated as hedging instruments for regulatory purposes
|
$
|
44
|
|
$
|
8
|
|
|
$
|
2
|
|
$
|
15
|
|
Derivatives designated as hedging instruments in cash flow and fair value hedges
|
|
|
|
|
|
||||||||
Interest rate derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
$
|
2
|
|
$
|
—
|
|
|
$
|
5
|
|
$
|
—
|
|
Other deferred charges and assets/Other deferred credits and liabilities
|
—
|
|
3
|
|
|
—
|
|
6
|
|
||||
Total derivatives designated as hedging instruments in cash flow and fair value hedges
|
$
|
2
|
|
$
|
3
|
|
|
$
|
5
|
|
$
|
6
|
|
Gross amounts recognized
|
$
|
46
|
|
$
|
11
|
|
|
$
|
7
|
|
$
|
21
|
|
Gross amounts offset
|
$
|
(8
|
)
|
$
|
(8
|
)
|
|
$
|
(6
|
)
|
$
|
(6
|
)
|
Net amounts recognized in the Balance Sheets
(*)
|
$
|
38
|
|
$
|
3
|
|
|
$
|
1
|
|
$
|
15
|
|
(*)
|
At
December 31, 2015
, the fair value amounts for derivative contracts subject to netting arrangements were presented gross on the balance sheet.
|
|
Unrealized Losses
|
|
Unrealized Gains
|
||||||||||||||
Derivative Category
|
Balance Sheet Location
|
2016
|
|
2015
|
|
Balance Sheet Location
|
2016
|
|
2015
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Energy-related derivatives:
(*)
|
Other regulatory assets, current
|
$
|
—
|
|
|
$
|
(12
|
)
|
|
Other regulatory liabilities, current
|
$
|
29
|
|
|
$
|
2
|
|
|
Other regulatory assets, deferred
|
—
|
|
|
(3
|
)
|
|
Other deferred credits and liabilities
|
7
|
|
|
—
|
|
||||
Total energy-related derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
(15
|
)
|
|
|
$
|
36
|
|
|
$
|
2
|
|
(*)
|
At
December 31, 2016
, the unrealized gains and losses for energy-related derivative contracts subject to netting arrangements were presented net on the balance sheet. At
December 31, 2015
, the unrealized gains and losses for energy-related derivative contracts subject to netting arrangements were presented gross on the balance sheet.
|
Derivatives in Cash Flow Hedging Relationships
|
Gain (Loss) Recognized in OCI on Derivative (Effective Portion)
|
|
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
|||||||||||||||||||||
|
|
|
|
|
|
|
|
Amount
|
||||||||||||||||
Derivative Category
|
2016
|
|
2015
|
|
2014
|
|
Statements of Income Location
|
2016
|
|
2015
|
|
2014
|
||||||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||||||||||
Interest rate derivatives
|
$
|
—
|
|
|
$
|
(15
|
)
|
|
$
|
(8
|
)
|
|
Interest expense, net of amounts capitalized
|
$
|
(4
|
)
|
|
$
|
(3
|
)
|
|
$
|
(3
|
)
|
Quarter Ended
|
Operating Revenues
|
|
Operating Income
|
|
Net Income After Dividends on Preferred and Preference Stock
|
||||||
|
(in millions)
|
||||||||||
March 2016
|
$
|
1,872
|
|
|
$
|
509
|
|
|
$
|
269
|
|
June 2016
|
2,051
|
|
|
656
|
|
|
349
|
|
|||
September 2016
|
2,698
|
|
|
1,054
|
|
|
599
|
|
|||
December 2016
|
1,762
|
|
|
258
|
|
|
113
|
|
|||
|
|
|
|
|
|
||||||
March 2015
|
$
|
1,978
|
|
|
$
|
454
|
|
|
$
|
236
|
|
June 2015
|
2,016
|
|
|
554
|
|
|
277
|
|
|||
September 2015
|
2,691
|
|
|
964
|
|
|
551
|
|
|||
December 2015
|
1,641
|
|
|
376
|
|
|
196
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (in millions)
|
$
|
8,383
|
|
|
$
|
8,326
|
|
|
$
|
8,988
|
|
|
$
|
8,274
|
|
|
$
|
7,998
|
|
Net Income After Dividends
on Preferred and Preference Stock (in millions)
|
$
|
1,330
|
|
|
$
|
1,260
|
|
|
$
|
1,225
|
|
|
$
|
1,174
|
|
|
$
|
1,168
|
|
Cash Dividends on Common Stock (in millions)
|
$
|
1,305
|
|
|
$
|
1,034
|
|
|
$
|
954
|
|
|
$
|
907
|
|
|
$
|
983
|
|
Return on Average Common Equity (percent)
|
12.05
|
|
|
11.92
|
|
|
12.24
|
|
|
12.45
|
|
|
12.76
|
|
|||||
Total Assets (in millions)
(a)(b)
|
$
|
34,835
|
|
|
$
|
32,865
|
|
|
$
|
30,872
|
|
|
$
|
28,776
|
|
|
$
|
28,618
|
|
Gross Property Additions (in millions)
|
$
|
2,314
|
|
|
$
|
2,332
|
|
|
$
|
2,146
|
|
|
$
|
1,906
|
|
|
$
|
1,838
|
|
Capitalization (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
$
|
11,356
|
|
|
$
|
10,719
|
|
|
$
|
10,421
|
|
|
$
|
9,591
|
|
|
$
|
9,273
|
|
Preferred and preference stock
|
266
|
|
|
266
|
|
|
266
|
|
|
266
|
|
|
266
|
|
|||||
Long-term debt
(a)
|
10,225
|
|
|
9,616
|
|
|
8,563
|
|
|
8,571
|
|
|
7,928
|
|
|||||
Total (excluding amounts due within one year)
|
$
|
21,847
|
|
|
$
|
20,601
|
|
|
$
|
19,250
|
|
|
$
|
18,428
|
|
|
$
|
17,467
|
|
Capitalization Ratios (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
52.0
|
|
|
52.0
|
|
|
54.1
|
|
|
52.0
|
|
|
53.1
|
|
|||||
Preferred and preference stock
|
1.2
|
|
|
1.3
|
|
|
1.4
|
|
|
1.4
|
|
|
1.5
|
|
|||||
Long-term debt
(a)
|
46.8
|
|
|
46.7
|
|
|
44.5
|
|
|
46.6
|
|
|
45.4
|
|
|||||
Total (excluding amounts due within one year)
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|||||
Customers (year-end):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
2,155,945
|
|
|
2,127,658
|
|
|
2,102,673
|
|
|
2,080,358
|
|
|
2,062,040
|
|
|||||
Commercial
(c)
|
305,488
|
|
|
302,891
|
|
|
300,186
|
|
|
297,493
|
|
|
295,523
|
|
|||||
Industrial
(c)
|
10,537
|
|
|
10,429
|
|
|
10,192
|
|
|
10,063
|
|
|
10,017
|
|
|||||
Other
|
9,585
|
|
|
9,261
|
|
|
9,003
|
|
|
8,623
|
|
|
7,724
|
|
|||||
Total
|
2,481,555
|
|
|
2,450,239
|
|
|
2,422,054
|
|
|
2,396,537
|
|
|
2,375,304
|
|
|||||
Employees (year-end)
|
7,527
|
|
|
7,989
|
|
|
7,909
|
|
|
7,886
|
|
|
8,094
|
|
(a)
|
A reclassification of debt issuance costs from Total Assets to Long-term debt of $124 million, $62 million, and $67 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
(b)
|
A reclassification of deferred tax assets from Total Assets of $34 million, $68 million, and $117 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
(c)
|
A reclassification of customers from commercial to industrial is reflected for years 2012-2015 to be consistent with the rate structure approved by the Georgia PSC. The impact to operating revenues, kilowatt-hour sales, and average revenue per kilowatt-hour by class is not material.
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
$
|
3,318
|
|
|
$
|
3,240
|
|
|
$
|
3,350
|
|
|
$
|
3,058
|
|
|
$
|
2,986
|
|
Commercial
|
3,077
|
|
|
3,094
|
|
|
3,271
|
|
|
3,077
|
|
|
2,965
|
|
|||||
Industrial
|
1,291
|
|
|
1,305
|
|
|
1,525
|
|
|
1,391
|
|
|
1,322
|
|
|||||
Other
|
86
|
|
|
88
|
|
|
94
|
|
|
94
|
|
|
89
|
|
|||||
Total retail
|
7,772
|
|
|
7,727
|
|
|
8,240
|
|
|
7,620
|
|
|
7,362
|
|
|||||
Wholesale — non-affiliates
|
175
|
|
|
215
|
|
|
335
|
|
|
281
|
|
|
281
|
|
|||||
Wholesale — affiliates
|
42
|
|
|
20
|
|
|
42
|
|
|
20
|
|
|
20
|
|
|||||
Total revenues from sales of electricity
|
7,989
|
|
|
7,962
|
|
|
8,617
|
|
|
7,921
|
|
|
7,663
|
|
|||||
Other revenues
|
394
|
|
|
364
|
|
|
371
|
|
|
353
|
|
|
335
|
|
|||||
Total
|
$
|
8,383
|
|
|
$
|
8,326
|
|
|
$
|
8,988
|
|
|
$
|
8,274
|
|
|
$
|
7,998
|
|
Kilowatt-Hour Sales (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
27,585
|
|
|
26,649
|
|
|
27,132
|
|
|
25,479
|
|
|
25,742
|
|
|||||
Commercial
|
32,932
|
|
|
32,719
|
|
|
32,426
|
|
|
31,984
|
|
|
32,270
|
|
|||||
Industrial
|
23,746
|
|
|
23,805
|
|
|
23,549
|
|
|
23,087
|
|
|
23,089
|
|
|||||
Other
|
610
|
|
|
632
|
|
|
633
|
|
|
630
|
|
|
641
|
|
|||||
Total retail
|
84,873
|
|
|
83,805
|
|
|
83,740
|
|
|
81,180
|
|
|
81,742
|
|
|||||
Wholesale — non-affiliates
|
3,415
|
|
|
3,501
|
|
|
4,323
|
|
|
3,029
|
|
|
2,934
|
|
|||||
Wholesale — affiliates
|
1,398
|
|
|
552
|
|
|
1,117
|
|
|
496
|
|
|
600
|
|
|||||
Total
|
89,686
|
|
|
87,858
|
|
|
89,180
|
|
|
84,705
|
|
|
85,276
|
|
|||||
Average Revenue Per Kilowatt-Hour (cents):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
12.03
|
|
|
12.16
|
|
|
12.35
|
|
|
12.00
|
|
|
11.60
|
|
|||||
Commercial
|
9.34
|
|
|
9.46
|
|
|
10.09
|
|
|
9.62
|
|
|
9.19
|
|
|||||
Industrial
|
5.44
|
|
|
5.48
|
|
|
6.48
|
|
|
6.03
|
|
|
5.73
|
|
|||||
Total retail
|
9.16
|
|
|
9.22
|
|
|
9.84
|
|
|
9.39
|
|
|
9.01
|
|
|||||
Wholesale
|
4.51
|
|
|
5.80
|
|
|
6.93
|
|
|
8.54
|
|
|
8.52
|
|
|||||
Total sales
|
8.91
|
|
|
9.06
|
|
|
9.66
|
|
|
9.35
|
|
|
8.99
|
|
|||||
Residential Average Annual
Kilowatt-Hour Use Per Customer
|
12,864
|
|
|
12,582
|
|
|
12,969
|
|
|
12,293
|
|
|
12,509
|
|
|||||
Residential Average Annual
Revenue Per Customer
|
$
|
1,557
|
|
|
$
|
1,529
|
|
|
$
|
1,605
|
|
|
$
|
1,475
|
|
|
$
|
1,451
|
|
Plant Nameplate Capacity
Ratings (year-end) (megawatts)
|
15,274
|
|
|
15,455
|
|
|
17,593
|
|
|
17,586
|
|
|
17,984
|
|
|||||
Maximum Peak-Hour Demand (megawatts):
|
|
|
|
|
|
|
|
|
|
||||||||||
Winter
|
14,527
|
|
|
15,735
|
|
|
16,308
|
|
|
12,767
|
|
|
14,104
|
|
|||||
Summer
|
16,244
|
|
|
16,104
|
|
|
15,777
|
|
|
15,228
|
|
|
16,440
|
|
|||||
Annual Load Factor (percent)
|
61.9
|
|
|
61.9
|
|
|
61.2
|
|
|
63.5
|
|
|
59.1
|
|
|||||
Plant Availability (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Fossil-steam
|
87.4
|
|
|
85.6
|
|
|
86.3
|
|
|
87.1
|
|
|
90.3
|
|
|||||
Nuclear
|
95.6
|
|
|
94.1
|
|
|
90.8
|
|
|
91.8
|
|
|
94.1
|
|
|||||
Source of Energy Supply (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Coal
|
26.4
|
|
|
24.5
|
|
|
30.9
|
|
|
26.4
|
|
|
26.6
|
|
|||||
Nuclear
|
17.6
|
|
|
17.6
|
|
|
16.7
|
|
|
17.7
|
|
|
18.3
|
|
|||||
Hydro
|
1.1
|
|
|
1.6
|
|
|
1.3
|
|
|
2.0
|
|
|
0.7
|
|
|||||
Oil and gas
|
28.2
|
|
|
28.3
|
|
|
26.3
|
|
|
29.6
|
|
|
22.0
|
|
|||||
Purchased power —
|
|
|
|
|
|
|
|
|
|
||||||||||
From non-affiliates
|
6.7
|
|
|
5.0
|
|
|
3.8
|
|
|
3.3
|
|
|
6.8
|
|
|||||
From affiliates
|
20.0
|
|
|
23.0
|
|
|
21.0
|
|
|
21.0
|
|
|
25.6
|
|
|||||
Total
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
Term
|
Meaning
|
AFUDC
|
Allowance for funds used during construction
|
Alabama Power
|
Alabama Power Company
|
ARO
|
Asset retirement obligation
|
ASC
|
Accounting Standards Codification
|
ASU
|
Accounting Standards Update
|
CCR
|
Coal combustion residuals
|
Clean Air Act
|
Clean Air Act Amendments of 1990
|
CO
2
|
Carbon dioxide
|
EPA
|
U.S. Environmental Protection Agency
|
FASB
|
Financial Accounting Standards Board
|
FERC
|
Federal Energy Regulatory Commission
|
GAAP
|
U.S. generally accepted accounting principles
|
Georgia Power
|
Georgia Power Company
|
IRS
|
Internal Revenue Service
|
ITC
|
Investment tax credit
|
KWH
|
Kilowatt-hour
|
Mississippi Power
|
Mississippi Power Company
|
mmBtu
|
Million British thermal units
|
Moody's
|
Moody's Investors Service, Inc.
|
MW
|
Megawatt
|
OCI
|
Other comprehensive income
|
power pool
|
The operating arrangement whereby the integrated generating resources of the traditional electric operating companies and Southern Power (excluding subsidiaries) are subject to joint commitment and dispatch in order to serve their combined load obligations
|
PPA
|
Power purchase agreement
|
PSC
|
Public Service Commission
|
ROE
|
Return on equity
|
S&P
|
S&P Global Ratings, a division of S&P Global Inc.
|
scrubber
|
Flue gas desulfurization system
|
SCS
|
Southern Company Services, Inc. (the Southern Company system service company)
|
SEC
|
U.S. Securities and Exchange Commission
|
Southern Company
|
The Southern Company
|
Southern Company Gas
|
Southern Company Gas (formerly known as AGL Resources Inc.) and its subsidiaries
|
Southern Company system
|
Southern Company, the traditional electric operating companies, Southern Power, Southern Company Gas (as of July 1, 2016), Southern Electric Generating Company, Southern Nuclear, SCS, Southern LINC, PowerSecure, Inc. (as of May 9, 2016), and other subsidiaries
|
Southern LINC
|
Southern Communications Services, Inc.
|
Southern Nuclear
|
Southern Nuclear Operating Company, Inc.
|
Southern Power
|
Southern Power Company and its subsidiaries
|
traditional electric operating companies
|
Alabama Power, Georgia Power, Gulf Power Company, and Mississippi Power
|
|
Amount
|
|
Increase (Decrease)
from Prior Year
|
||||||||
|
2016
|
|
2016
|
|
2015
|
||||||
|
(in millions)
|
||||||||||
Operating revenues
|
$
|
1,485
|
|
|
$
|
2
|
|
|
$
|
(107
|
)
|
Fuel
|
432
|
|
|
(13
|
)
|
|
(160
|
)
|
|||
Purchased power
|
142
|
|
|
7
|
|
|
28
|
|
|||
Other operations and maintenance
|
336
|
|
|
(18
|
)
|
|
13
|
|
|||
Depreciation and amortization
|
172
|
|
|
31
|
|
|
(4
|
)
|
|||
Taxes other than income taxes
|
120
|
|
|
2
|
|
|
7
|
|
|||
Total operating expenses
|
1,202
|
|
|
9
|
|
|
(116
|
)
|
|||
Operating income
|
283
|
|
|
(7
|
)
|
|
9
|
|
|||
Total other income and (expense)
|
(52
|
)
|
|
(11
|
)
|
|
3
|
|
|||
Income taxes
|
91
|
|
|
(1
|
)
|
|
4
|
|
|||
Net income
|
140
|
|
|
(17
|
)
|
|
8
|
|
|||
Dividends on preference stock
|
9
|
|
|
—
|
|
|
—
|
|
|||
Net income after dividends on preference stock
|
$
|
131
|
|
|
$
|
(17
|
)
|
|
$
|
8
|
|
|
Amount
|
||||||
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Retail — prior year
|
$
|
1,249
|
|
|
$
|
1,267
|
|
Estimated change resulting from –
|
|
|
|
||||
Rates and pricing
|
30
|
|
|
22
|
|
||
Sales growth
|
—
|
|
|
—
|
|
||
Weather
|
1
|
|
|
3
|
|
||
Fuel and other cost recovery
|
1
|
|
|
(43
|
)
|
||
Retail — current year
|
1,281
|
|
|
1,249
|
|
||
Wholesale revenues –
|
|
|
|
||||
Non-affiliates
|
61
|
|
|
107
|
|
||
Affiliates
|
75
|
|
|
58
|
|
||
Total wholesale revenues
|
136
|
|
|
165
|
|
||
Other operating revenues
|
68
|
|
|
69
|
|
||
Total operating revenues
|
$
|
1,485
|
|
|
$
|
1,483
|
|
Percent change
|
N/M
|
|
|
(6.7
|
)%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Capacity and other
|
$
|
30
|
|
|
$
|
67
|
|
|
$
|
65
|
|
Energy
|
31
|
|
|
40
|
|
|
64
|
|
|||
Total non-affiliated
|
$
|
61
|
|
|
$
|
107
|
|
|
$
|
129
|
|
|
2016
|
|
2015
|
|
2014
|
|||
Total generation
(in millions of KWHs)
|
8,259
|
|
|
8,629
|
|
|
11,109
|
|
Total purchased power
(in millions of KWHs)
|
6,973
|
|
|
5,976
|
|
|
5,547
|
|
Sources of generation
(percent)
–
|
|
|
|
|
|
|||
Coal
|
57
|
|
|
57
|
|
|
67
|
|
Gas
|
43
|
|
|
43
|
|
|
33
|
|
Cost of fuel, generated
(in cents per net KWH)
–
|
|
|
|
|
|
|||
Coal
|
3.68
|
|
|
3.88
|
|
|
4.03
|
|
Gas
|
4.17
|
|
|
4.22
|
|
|
3.93
|
|
Average cost of fuel, generated
(in cents per net KWH)
|
3.89
|
|
|
4.03
|
|
|
3.99
|
|
Average cost of purchased power
(in cents per net KWH)
(*)
|
3.63
|
|
|
3.89
|
|
|
4.83
|
|
Expires
|
|
|
|
|
|
Executable
Term Loans
|
|
Expires Within One Year
|
|||||
2017
|
2018
|
|
Total
|
|
Unused
|
|
One
Year
|
|
Two
Years
|
|
Term Out
|
|
No Term Out
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
|||||||
$85
|
$195
|
|
$280
|
|
$280
|
|
$45
|
|
$—
|
|
$25
|
|
$60
|
|
Short-term Debt at the End of the Period
|
|
Short-term Debt During the Period
(*)
|
||||||||||||||
|
Amount Outstanding
|
|
Weighted Average Interest Rate
|
|
Average Amount Outstanding
|
|
Weighted Average Interest Rate
|
|
Maximum Amount Outstanding
|
||||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
|
(in millions)
|
||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
$
|
168
|
|
|
1.1
|
%
|
|
$
|
53
|
|
|
0.9
|
%
|
|
$
|
168
|
|
Short-term bank debt
|
100
|
|
|
1.5
|
%
|
|
64
|
|
|
1.3
|
%
|
|
100
|
|
|||
Total
|
$
|
268
|
|
|
1.2
|
%
|
|
$
|
117
|
|
|
1.1
|
%
|
|
|
||
December 31, 2015
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
$
|
142
|
|
|
0.7
|
%
|
|
$
|
101
|
|
|
0.4
|
%
|
|
$
|
175
|
|
Short-term bank debt
|
—
|
|
|
—
|
%
|
|
10
|
|
|
0.7
|
%
|
|
40
|
|
|||
Total
|
$
|
142
|
|
|
0.7
|
%
|
|
$
|
111
|
|
|
0.4
|
%
|
|
|
||
December 31, 2014
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
$
|
110
|
|
|
0.3
|
%
|
|
$
|
85
|
|
|
0.2
|
%
|
|
$
|
145
|
|
(*)
|
Average and maximum amounts are based upon daily balances during the year.
|
Credit Ratings
|
Maximum
Potential
Collateral
Requirements
|
||
|
(in millions)
|
||
At BBB- and/or Baa3
|
$
|
192
|
|
Below BBB- and/or Baa3
|
$
|
628
|
|
|
2016
Changes
|
|
2015
Changes
|
||||
|
Fair Value
|
||||||
|
(in millions)
|
||||||
Contracts outstanding at the beginning of the period, assets (liabilities), net
|
$
|
(100
|
)
|
|
$
|
(72
|
)
|
Contracts realized or settled
|
49
|
|
|
47
|
|
||
Current period changes
(*)
|
27
|
|
|
(75
|
)
|
||
Contracts outstanding at the end of the period, assets (liabilities), net
|
$
|
(24
|
)
|
|
$
|
(100
|
)
|
(*)
|
Current period changes also include the changes in fair value of new contracts entered into during the period, if any.
|
|
Fair Value Measurements
December 31, 2016
|
||||||||||||||
|
Total
|
|
Maturity
|
||||||||||||
|
Fair Value
|
|
Year 1
|
|
Years 2&3
|
|
Years 4&5
|
||||||||
|
(in millions)
|
||||||||||||||
Level 1
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Level 2
|
(24
|
)
|
|
(8
|
)
|
|
(16
|
)
|
|
—
|
|
||||
Level 3
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Fair value of contracts outstanding at end of period
|
$
|
(24
|
)
|
|
$
|
(8
|
)
|
|
$
|
(16
|
)
|
|
$
|
—
|
|
|
2017
|
|
2018-
2019
|
|
2020-
2021
|
|
After
2021
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Long-term debt
(a)
–
|
|
|
|
|
|
|
|
|
|
||||||||||
Principal
|
$
|
87
|
|
|
$
|
—
|
|
|
$
|
175
|
|
|
$
|
824
|
|
|
$
|
1,086
|
|
Interest
|
42
|
|
|
73
|
|
|
65
|
|
|
515
|
|
|
695
|
|
|||||
Financial derivative obligations
(b)
|
12
|
|
|
17
|
|
|
—
|
|
|
—
|
|
|
29
|
|
|||||
Preference stock dividends
(c)
|
9
|
|
|
18
|
|
|
18
|
|
|
—
|
|
|
45
|
|
|||||
Operating leases
(d)
|
8
|
|
|
7
|
|
|
—
|
|
|
1
|
|
|
16
|
|
|||||
Purchase commitments –
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital
(e)
|
227
|
|
|
437
|
|
|
462
|
|
|
—
|
|
|
1,126
|
|
|||||
Fuel
(f)
|
261
|
|
|
290
|
|
|
162
|
|
|
70
|
|
|
783
|
|
|||||
Purchased power
(g)
|
126
|
|
|
261
|
|
|
271
|
|
|
1,044
|
|
|
1,702
|
|
|||||
Other
(h)
|
8
|
|
|
24
|
|
|
34
|
|
|
136
|
|
|
202
|
|
|||||
Pension and other postretirement benefit plans
(i)
|
5
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
16
|
|
|||||
Total
|
$
|
785
|
|
|
$
|
1,138
|
|
|
$
|
1,187
|
|
|
$
|
2,590
|
|
|
$
|
5,700
|
|
(a)
|
All amounts are reflected based on final maturity dates. The Company plans to continue, when economically feasible, to retire higher-cost securities and replace these obligations with lower-cost capital if market conditions permit. Variable rate interest obligations are estimated based on rates as of January 1, 2017, as reflected in the statements of capitalization. Fixed rates include, where applicable, the effects of interest rate derivatives employed to manage interest rate risk.
|
(b)
|
Includes derivative liabilities related to cash flow hedges of forecasted debt, as well as energy-related derivatives. For additional information, see Notes 1 and 10 to the financial statements.
|
(c)
|
Preference stock does not mature; therefore, amounts are provided for the next five years only.
|
(d)
|
Excludes a PPA accounted for as a lease, which is included in "Purchased power."
|
(e)
|
The Company provides estimated capital expenditures for a five-year period, including capital expenditures associated with environmental regulations. These amounts exclude capital expenditures covered under long-term service agreements, which are reflected in "Other." At December 31, 2016, significant purchase commitments were outstanding in connection with the construction program. See FUTURE EARNINGS POTENTIAL – "Environmental Matters – Environmental Statutes and Regulations" for additional information.
|
(f)
|
Includes commitments to purchase coal and natural gas, as well as the related transportation and storage. In most cases, these contracts contain provisions for price escalation, minimum purchase levels, and other financial commitments. Natural gas purchase commitments are based on various indices at the time of delivery. Amounts reflected for natural gas purchase commitments have been estimated based on the New York Mercantile Exchange future prices at December 31, 2016.
|
(g)
|
The capacity and transmission related costs associated with PPAs are recovered through the purchased power capacity clause. Energy costs associated with PPAs are recovered through the fuel clause. See Notes 3 and 7 to the financial statements for additional information.
|
(h)
|
Includes long-term service agreements and contracts for the procurement of limestone. Long-term service agreements include price escalation based on inflation indices. Limestone costs are recovered through the environmental cost recovery clause. See Note 3 to the financial statements for additional information.
|
(i)
|
The Company forecasts contributions to the pension and other postretirement benefit plans over a three-year period. The Company anticipates no mandatory contributions to the qualified pension plan during the next three years. Amounts presented represent estimated benefit payments for the nonqualified pension plans, estimated non-trust benefit payments for the other postretirement benefit plans, and estimated contributions to the other postretirement benefit plan trusts, all of which will be made from the Company's corporate assets. See Note 2 to the financial statements for additional information related to the pension and other postretirement benefit plans, including estimated benefit payments. Certain benefit payments will be made through the related benefit plans. Other benefit payments will be made from the Company's corporate assets.
|
•
|
the impact of recent and future federal and state regulatory changes, including environmental laws regulating emissions, discharges, and disposal to air, water, and land
,
and also changes in tax and other laws and regulations to which
the Company is
subject, including potential tax reform legislation, as well as changes in application of existing laws and regulations;
|
•
|
current and future litigation, regulatory investigations, proceedings, or inquiries
;
|
•
|
the effects, extent, and timing of the entry of additional competition in the markets in which
the Company operates;
|
•
|
variations in demand for
electricity,
including those relating to weather, the general economy and recovery from the last recession, population and business growth (and declines), the effects of energy conservation and efficiency measures, including from the development and deployment of alternative energy sources such as self-generation and distributed generation technologies, and any potential economic impacts resulting from federal fiscal decisions;
|
•
|
available sources and costs of
fuels;
|
•
|
effects of inflation;
|
•
|
the ability to control costs and avoid cost overruns during the development
and construction of facilities,
to construct facilities in accordance with the requirements of permits and licenses,
and
to satisfy any environmental performance standards
;
|
•
|
investment performance of
the Company's
employee and retiree benefit plans
;
|
•
|
advances in technology;
|
•
|
state and federal rate regulations
and the impact of pending and future rate cases and negotiations, including rate
actions relating
to fuel and other cost recovery mechanisms;
|
•
|
the ability to successfully operate generating, transmission, and distribution facilities and the successful performance of necessary corporate functions;
|
•
|
internal restructuring or other restructuring options that may be pursued;
|
•
|
potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to
the Company;
|
•
|
the ability of counterparties of
the Company
to make payments as and when due and to perform as required;
|
•
|
the ability to obtain new short- and long-term contracts with wholesale customers;
|
•
|
the direct or indirect effect on the
Company's
business resulting from cyber intrusion or terrorist incidents and the threat of terrorist incidents;
|
•
|
interest rate fluctuations and financial market conditions and the results of financing efforts;
|
•
|
changes in the Company's
credit ratings, including impacts on interest rates, access to capital markets, and collateral requirements;
|
•
|
the impacts of any sovereign financial issues, including impacts on interest rates, access to capital markets, impacts on foreign currency exchange rates, counterparty performance, and the economy in general
;
|
•
|
the ability of
the Company
to obtain additional generating capacity (or sell excess generating capacity) at competitive prices;
|
•
|
catastrophic events such as fires, earthquakes, explosions, floods, tornadoes,
hurricanes and other storms, droughts, pandemic health events such as influenzas, or other similar occurrences;
|
•
|
the direct or indirect effects on the
Company's
business resulting from incidents affecting the U.S. electric grid
or operation of generating
resources;
|
•
|
the effect of accounting pronouncements issued periodically by standard-setting bodies; and
|
•
|
other factors discussed elsewhere herein and in other reports (including the Form 10-K) filed by
the Company
from time to time with the SEC.
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
||||||
Retail revenues
|
$
|
1,281
|
|
|
$
|
1,249
|
|
|
$
|
1,267
|
|
Wholesale revenues, non-affiliates
|
61
|
|
|
107
|
|
|
129
|
|
|||
Wholesale revenues, affiliates
|
75
|
|
|
58
|
|
|
130
|
|
|||
Other revenues
|
68
|
|
|
69
|
|
|
64
|
|
|||
Total operating revenues
|
1,485
|
|
|
1,483
|
|
|
1,590
|
|
|||
Operating Expenses:
|
|
|
|
|
|
||||||
Fuel
|
432
|
|
|
445
|
|
|
605
|
|
|||
Purchased power, non-affiliates
|
126
|
|
|
100
|
|
|
82
|
|
|||
Purchased power, affiliates
|
16
|
|
|
35
|
|
|
25
|
|
|||
Other operations and maintenance
|
336
|
|
|
354
|
|
|
341
|
|
|||
Depreciation and amortization
|
172
|
|
|
141
|
|
|
145
|
|
|||
Taxes other than income taxes
|
120
|
|
|
118
|
|
|
111
|
|
|||
Total operating expenses
|
1,202
|
|
|
1,193
|
|
|
1,309
|
|
|||
Operating Income
|
283
|
|
|
290
|
|
|
281
|
|
|||
Other Income and (Expense):
|
|
|
|
|
|
||||||
Interest expense, net of amounts capitalized
|
(47
|
)
|
|
(49
|
)
|
|
(53
|
)
|
|||
Other income (expense), net
|
(5
|
)
|
|
8
|
|
|
9
|
|
|||
Total other income and (expense)
|
(52
|
)
|
|
(41
|
)
|
|
(44
|
)
|
|||
Earnings Before Income Taxes
|
231
|
|
|
249
|
|
|
237
|
|
|||
Income taxes
|
91
|
|
|
92
|
|
|
88
|
|
|||
Net Income
|
140
|
|
|
157
|
|
|
149
|
|
|||
Dividends on Preference Stock
|
9
|
|
|
9
|
|
|
9
|
|
|||
Net Income After Dividends on Preference Stock
|
$
|
131
|
|
|
$
|
148
|
|
|
$
|
140
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Net Income
|
$
|
140
|
|
|
$
|
157
|
|
|
$
|
149
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Qualifying hedges:
|
|
|
|
|
|
||||||
Changes in fair value, net of tax of $-, $-, and $-, respectively
|
1
|
|
|
1
|
|
|
—
|
|
|||
Total other comprehensive income (loss)
|
1
|
|
|
1
|
|
|
—
|
|
|||
Comprehensive Income
|
$
|
141
|
|
|
$
|
158
|
|
|
$
|
149
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Operating Activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
140
|
|
|
$
|
157
|
|
|
$
|
149
|
|
Adjustments to reconcile net income
to net cash provided from operating activities — |
|
|
|
|
|
||||||
Depreciation and amortization, total
|
179
|
|
|
152
|
|
|
153
|
|
|||
Deferred income taxes
|
57
|
|
|
90
|
|
|
65
|
|
|||
Pension and postretirement funding
|
(48
|
)
|
|
—
|
|
|
(30
|
)
|
|||
Other, net
|
(3
|
)
|
|
4
|
|
|
(4
|
)
|
|||
Changes in certain current assets and liabilities —
|
|
|
|
|
|
||||||
-Receivables
|
15
|
|
|
33
|
|
|
(17
|
)
|
|||
-Fossil fuel stock
|
37
|
|
|
(6
|
)
|
|
34
|
|
|||
-Prepaid income taxes
|
(11
|
)
|
|
32
|
|
|
(19
|
)
|
|||
-Other current assets
|
(1
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|||
-Accounts payable
|
5
|
|
|
(22
|
)
|
|
8
|
|
|||
-Over recovered regulatory clause revenues
|
1
|
|
|
22
|
|
|
—
|
|
|||
-Other current liabilities
|
8
|
|
|
—
|
|
|
7
|
|
|||
Net cash provided from operating activities
|
379
|
|
|
460
|
|
|
344
|
|
|||
Investing Activities:
|
|
|
|
|
|
||||||
Property additions
|
(178
|
)
|
|
(235
|
)
|
|
(348
|
)
|
|||
Cost of removal net of salvage
|
(9
|
)
|
|
(10
|
)
|
|
(13
|
)
|
|||
Change in construction payables
|
13
|
|
|
(28
|
)
|
|
12
|
|
|||
Payments pursuant to long-term service agreements
|
(5
|
)
|
|
(8
|
)
|
|
(8
|
)
|
|||
Other investing activities
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||
Net cash used for investing activities
|
(180
|
)
|
|
(281
|
)
|
|
(358
|
)
|
|||
Financing Activities:
|
|
|
|
|
|
||||||
Increase (decrease) in notes payable, net
|
126
|
|
|
32
|
|
|
(26
|
)
|
|||
Proceeds —
|
|
|
|
|
|
||||||
Common stock issued to parent
|
—
|
|
|
20
|
|
|
50
|
|
|||
Capital contributions from parent company
|
20
|
|
|
4
|
|
|
4
|
|
|||
Pollution control revenue bonds
|
—
|
|
|
13
|
|
|
42
|
|
|||
Senior notes
|
—
|
|
|
—
|
|
|
200
|
|
|||
Redemptions and repurchases —
|
|
|
|
|
|
||||||
Senior notes
|
(235
|
)
|
|
(60
|
)
|
|
(75
|
)
|
|||
Pollution control revenue bonds
|
—
|
|
|
(13
|
)
|
|
(29
|
)
|
|||
Payment of common stock dividends
|
(120
|
)
|
|
(130
|
)
|
|
(123
|
)
|
|||
Other financing activities
|
(8
|
)
|
|
(10
|
)
|
|
(12
|
)
|
|||
Net cash provided from (used for) financing activities
|
(217
|
)
|
|
(144
|
)
|
|
31
|
|
|||
Net Change in Cash and Cash Equivalents
|
(18
|
)
|
|
35
|
|
|
17
|
|
|||
Cash and Cash Equivalents at Beginning of Year
|
74
|
|
|
39
|
|
|
22
|
|
|||
Cash and Cash Equivalents at End of Year
|
$
|
56
|
|
|
$
|
74
|
|
|
$
|
39
|
|
Supplemental Cash Flow Information:
|
|
|
|
|
|
||||||
Cash paid (received) during the period for —
|
|
|
|
|
|
||||||
Interest (net of $-, $6, and $5 capitalized, respectively)
|
$
|
53
|
|
|
$
|
52
|
|
|
$
|
48
|
|
Income taxes (net of refunds)
|
21
|
|
|
(7
|
)
|
|
44
|
|
|||
Noncash transactions — accrued property additions at year-end
|
33
|
|
|
20
|
|
|
42
|
|
Assets
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
56
|
|
|
$
|
74
|
|
Receivables —
|
|
|
|
||||
Customer accounts receivable
|
72
|
|
|
76
|
|
||
Unbilled revenues
|
55
|
|
|
54
|
|
||
Under recovered regulatory clause revenues
|
17
|
|
|
20
|
|
||
Income taxes receivable, current
|
—
|
|
|
27
|
|
||
Other accounts and notes receivable
|
6
|
|
|
9
|
|
||
Affiliated
|
17
|
|
|
1
|
|
||
Accumulated provision for uncollectible accounts
|
(1
|
)
|
|
(1
|
)
|
||
Fossil fuel stock
|
71
|
|
|
108
|
|
||
Materials and supplies
|
55
|
|
|
56
|
|
||
Prepaid expenses
|
18
|
|
|
8
|
|
||
Other regulatory assets, current
|
44
|
|
|
90
|
|
||
Other current assets
|
12
|
|
|
14
|
|
||
Total current assets
|
422
|
|
|
536
|
|
||
Property, Plant, and Equipment:
|
|
|
|
||||
In service
|
5,140
|
|
|
5,045
|
|
||
Less accumulated provision for depreciation
|
1,382
|
|
|
1,296
|
|
||
Plant in service, net of depreciation
|
3,758
|
|
|
3,749
|
|
||
Other utility plant, net
|
—
|
|
|
62
|
|
||
Construction work in progress
|
51
|
|
|
48
|
|
||
Total property, plant, and equipment
|
3,809
|
|
|
3,859
|
|
||
Deferred Charges and Other Assets:
|
|
|
|
||||
Deferred charges related to income taxes
|
58
|
|
|
61
|
|
||
Other regulatory assets, deferred
|
512
|
|
|
427
|
|
||
Other deferred charges and assets
|
21
|
|
|
37
|
|
||
Total deferred charges and other assets
|
591
|
|
|
525
|
|
||
Total Assets
|
$
|
4,822
|
|
|
$
|
4,920
|
|
Liabilities and Stockholder's Equity
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
||||
Securities due within one year
|
$
|
87
|
|
|
$
|
110
|
|
Notes payable
|
268
|
|
|
142
|
|
||
Accounts payable —
|
|
|
|
||||
Affiliated
|
59
|
|
|
55
|
|
||
Other
|
54
|
|
|
44
|
|
||
Customer deposits
|
35
|
|
|
36
|
|
||
Accrued taxes —
|
|
|
|
||||
Accrued income taxes
|
1
|
|
|
4
|
|
||
Other accrued taxes
|
19
|
|
|
9
|
|
||
Accrued interest
|
8
|
|
|
9
|
|
||
Accrued compensation
|
40
|
|
|
36
|
|
||
Deferred capacity expense, current
|
22
|
|
|
22
|
|
||
Other regulatory liabilities, current
|
16
|
|
|
22
|
|
||
Liabilities from risk management activities
|
9
|
|
|
49
|
|
||
Other current liabilities
|
31
|
|
|
29
|
|
||
Total current liabilities
|
649
|
|
|
567
|
|
||
Long-Term Debt
(See accompanying statements)
|
987
|
|
|
1,193
|
|
||
Deferred Credits and Other Liabilities:
|
|
|
|
||||
Accumulated deferred income taxes
|
948
|
|
|
893
|
|
||
Employee benefit obligations
|
96
|
|
|
129
|
|
||
Deferred capacity expense
|
119
|
|
|
141
|
|
||
Asset retirement obligations
|
120
|
|
|
113
|
|
||
Other cost of removal obligations
|
249
|
|
|
233
|
|
||
Other regulatory liabilities, deferred
|
47
|
|
|
47
|
|
||
Other deferred credits and liabilities
|
71
|
|
|
102
|
|
||
Total deferred credits and other liabilities
|
1,650
|
|
|
1,658
|
|
||
Total Liabilities
|
3,286
|
|
|
3,418
|
|
||
Preference Stock
(See accompanying statements)
|
147
|
|
|
147
|
|
||
Common Stockholder's Equity
(See accompanying statements)
|
1,389
|
|
|
1,355
|
|
||
Total Liabilities and Stockholder's Equity
|
$
|
4,822
|
|
|
$
|
4,920
|
|
Commitments and Contingent Matters
(See notes)
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
|
(percent of total)
|
||||||||||
Long-Term Debt:
|
|
|
|
|
|
|
|
||||||
Long-term notes payable —
|
|
|
|
|
|
|
|
||||||
5.30% due 2016
|
$
|
—
|
|
|
$
|
110
|
|
|
|
|
|
||
2.93 to 5.90% due 2017
|
87
|
|
|
85
|
|
|
|
|
|
||||
4.75% due 2020
|
175
|
|
|
175
|
|
|
|
|
|
||||
3.10% to 5.75% due 2022-2051
|
515
|
|
|
640
|
|
|
|
|
|
||||
Total long-term notes payable
|
777
|
|
|
1,010
|
|
|
|
|
|
||||
Other long-term debt —
|
|
|
|
|
|
|
|
||||||
Pollution control revenue bonds —
|
|
|
|
|
|
|
|
||||||
1.15% to 4.45% due 2022-2049
|
227
|
|
|
227
|
|
|
|
|
|
||||
Variable rates (0.75% to 0.84% at 1/1/17) due 2022-2042
|
82
|
|
|
82
|
|
|
|
|
|
||||
Total other long-term debt
|
309
|
|
|
309
|
|
|
|
|
|
||||
Unamortized debt discount
|
(5
|
)
|
|
(8
|
)
|
|
|
|
|
||||
Unamortized debt issuance expense
|
(7
|
)
|
|
(8
|
)
|
|
|
|
|
||||
Total long-term debt (annual interest requirement — $42 million)
|
1,074
|
|
|
1,303
|
|
|
|
|
|
||||
Less amount due within one year
|
87
|
|
|
110
|
|
|
|
|
|
||||
Long-term debt excluding amount due within one year
|
987
|
|
|
1,193
|
|
|
39.1
|
%
|
|
44.3
|
%
|
||
Preferred and Preference Stock:
|
|
|
|
|
|
|
|
||||||
Authorized — 20,000,000 shares — preferred stock
|
|
|
|
|
|
|
|
||||||
— 10,000,000 shares — preference stock
|
|
|
|
|
|
|
|
||||||
Outstanding — $100 par or stated value
|
|
|
|
|
|
|
|
||||||
— 6% preference stock — 550,000 shares (non-cumulative)
|
54
|
|
|
54
|
|
|
|
|
|
||||
— 6.45% preference stock — 450,000 shares (non-cumulative)
|
44
|
|
|
44
|
|
|
|
|
|
||||
— 5.60% preference stock — 500,000 shares (non-cumulative)
|
49
|
|
|
49
|
|
|
|
|
|
||||
Total preference stock (annual dividend requirement — $9 million)
|
147
|
|
|
147
|
|
|
5.8
|
|
|
5.4
|
|
||
Common Stockholder's Equity:
|
|
|
|
|
|
|
|
||||||
Common stock, without par value —
|
|
|
|
|
|
|
|
||||||
Authorized — 20,000,000 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — 5,642,717 shares
|
503
|
|
|
503
|
|
|
|
|
|
||||
Paid-in capital
|
589
|
|
|
567
|
|
|
|
|
|
||||
Retained earnings
|
296
|
|
|
285
|
|
|
|
|
|
||||
Accumulated other comprehensive loss
|
1
|
|
|
—
|
|
|
|
|
|
||||
Total common stockholder's equity
|
1,389
|
|
|
1,355
|
|
|
55.1
|
|
|
50.3
|
|
||
Total Capitalization
|
$
|
2,523
|
|
|
$
|
2,695
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Number of Common Shares Issued
|
|
Common Stock
|
|
Paid-In Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total
|
|||||||||||
|
(in millions)
|
|||||||||||||||||||||
Balance at December 31, 2013
|
5
|
|
|
$
|
433
|
|
|
$
|
553
|
|
|
$
|
250
|
|
|
$
|
(1
|
)
|
|
$
|
1,235
|
|
Net income after dividends on
preference stock
|
—
|
|
|
—
|
|
|
—
|
|
|
140
|
|
|
—
|
|
|
140
|
|
|||||
Issuance of common stock
|
—
|
|
|
50
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
50
|
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(123
|
)
|
|
—
|
|
|
(123
|
)
|
|||||
Balance at December 31, 2014
|
5
|
|
|
483
|
|
|
560
|
|
|
267
|
|
|
(1
|
)
|
|
1,309
|
|
|||||
Net income after dividends on
preference stock
|
—
|
|
|
—
|
|
|
—
|
|
|
148
|
|
|
—
|
|
|
148
|
|
|||||
Issuance of common stock
|
1
|
|
|
20
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20
|
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(130
|
)
|
|
—
|
|
|
(130
|
)
|
|||||
Balance at December 31, 2015
|
6
|
|
|
503
|
|
|
567
|
|
|
285
|
|
|
—
|
|
|
1,355
|
|
|||||
Net income after dividends on
preference stock
|
—
|
|
|
—
|
|
|
—
|
|
|
131
|
|
|
—
|
|
|
131
|
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(120
|
)
|
|
—
|
|
|
(120
|
)
|
|||||
Balance at December 31, 2016
|
6
|
|
|
$
|
503
|
|
|
$
|
589
|
|
|
$
|
296
|
|
|
$
|
1
|
|
|
$
|
1,389
|
|
Note
|
|
Page
|
1
|
||
2
|
||
3
|
||
4
|
||
5
|
||
6
|
||
7
|
||
8
|
||
9
|
||
10
|
||
11
|
|
2016
|
|
|
2015
|
|
|
Note
|
||
|
(in millions)
|
|
|
||||||
Retiree benefit plans, net
|
$
|
160
|
|
|
$
|
147
|
|
|
(a,b)
|
PPA charges
|
141
|
|
|
163
|
|
|
(b,c)
|
||
Closure of ash ponds
|
75
|
|
|
29
|
|
|
(b,d)
|
||
Remaining book value of retired assets
|
66
|
|
|
4
|
|
|
(e)
|
||
Deferred income tax charges
|
56
|
|
|
59
|
|
|
(f)
|
||
Environmental remediation
|
44
|
|
|
46
|
|
|
(b,d)
|
||
Regulatory asset, offset to other cost of removal
|
29
|
|
|
29
|
|
|
(g)
|
||
Deferred return on transmission upgrades
|
25
|
|
|
10
|
|
|
(g)
|
||
Fuel-hedging assets, net
|
24
|
|
|
104
|
|
|
(b,h)
|
||
Other regulatory assets, net
|
18
|
|
|
16
|
|
|
(i)
|
||
Loss on reacquired debt
|
18
|
|
|
15
|
|
|
(j)
|
||
Asset retirement obligations, net
|
7
|
|
|
(1
|
)
|
|
(b,f)
|
||
Other cost of removal obligations
|
(278
|
)
|
|
(262
|
)
|
|
(f)
|
||
Property damage reserve
|
(40
|
)
|
|
(38
|
)
|
|
(e)
|
||
Over recovered regulatory clause revenues
|
(23
|
)
|
|
(22
|
)
|
|
(k)
|
||
Deferred income tax credits
|
(2
|
)
|
|
(3
|
)
|
|
(f)
|
||
Total regulatory assets (liabilities), net
|
$
|
320
|
|
|
$
|
296
|
|
|
|
(a)
|
Recovered and amortized over the average remaining service period which may range up to
14 years
. See Note 2 for additional information.
|
(b)
|
Not earning a return as offset in rate base by a corresponding asset or liability.
|
(c)
|
Recovered over the life of the PPA for periods up to
seven years
.
|
(d)
|
Recovered through the environmental cost recovery clause when the remediation or the work is performed.
|
(e)
|
Recorded and recovered or amortized as approved by the Florida PSC.
|
(f)
|
Asset retirement and removal assets and liabilities are recorded, deferred income tax assets are recovered, and deferred income tax liabilities are amortized over the related property lives, which may range up to
65 years
. Asset retirement and removal assets and liabilities will be settled and trued up following completion of the related activities.
|
(g)
|
Recorded as authorized by the Florida PSC in a settlement agreement approved in December 2013 (2013 Rate Case Settlement Agreement). See Note 3 for additional information.
|
(h)
|
Fuel-hedging assets and liabilities are recorded over the life of the underlying hedged purchase contracts, which generally do not exceed
five years
. Upon final settlement, actual costs incurred are recovered through the fuel cost recovery clause.
|
(i)
|
Comprised primarily of vacation pay. Other regulatory assets costs, with the exception of vacation pay, are recorded and recovered or amortized as approved by the Florida PSC. Vacation pay, including banked holiday pay, does not earn a return as offset in rate base by a corresponding liability; it is recorded as earned by employees and recovered as paid, generally within
one year
.
|
(j)
|
Recovered over either the remaining life of the original issue or, if refinanced, over the life of the new issue, which may range up to
40 years
.
|
(k)
|
Recorded and recovered or amortized as approved by the Florida PSC, generally within
one year
.
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Generation
|
$
|
3,001
|
|
|
$
|
2,974
|
|
Transmission
|
706
|
|
|
691
|
|
||
Distribution
|
1,241
|
|
|
1,196
|
|
||
General
|
191
|
|
|
182
|
|
||
Plant acquisition adjustment
|
1
|
|
|
2
|
|
||
Total plant in service
|
$
|
5,140
|
|
|
$
|
5,045
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Balance at beginning of year
|
$
|
130
|
|
|
$
|
17
|
|
Liabilities incurred
|
1
|
|
|
105
|
|
||
Liabilities settled
|
(1
|
)
|
|
(1
|
)
|
||
Accretion
|
4
|
|
|
2
|
|
||
Cash flow revisions
|
2
|
|
|
7
|
|
||
Balance at end of year
|
$
|
136
|
|
|
$
|
130
|
|
Assumptions used to determine net periodic costs:
|
2016
|
|
2015
|
|
2014
|
|||
Pension plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.71
|
%
|
|
4.18
|
%
|
|
5.02
|
%
|
Discount rate – interest costs
|
3.97
|
|
|
4.18
|
|
|
5.02
|
|
Discount rate – service costs
|
5.04
|
|
|
4.48
|
|
|
5.02
|
|
Expected long-term return on plan assets
|
8.20
|
|
|
8.20
|
|
|
8.20
|
|
Annual salary increase
|
4.46
|
|
|
3.59
|
|
|
3.59
|
|
Other postretirement benefit plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.51
|
%
|
|
4.04
|
%
|
|
4.86
|
%
|
Discount rate – interest costs
|
3.68
|
|
|
4.04
|
|
|
4.86
|
|
Discount rate – service costs
|
4.88
|
|
|
4.38
|
|
|
4.86
|
|
Expected long-term return on plan assets
|
8.05
|
|
|
8.07
|
|
|
8.08
|
|
Annual salary increase
|
4.46
|
|
|
3.59
|
|
|
3.59
|
|
Assumptions used to determine benefit obligations:
|
2016
|
|
2015
|
||
Pension plans
|
|
|
|
||
Discount rate
|
4.46
|
%
|
|
4.71
|
%
|
Annual salary increase
|
4.46
|
|
|
4.46
|
|
Other postretirement benefit plans
|
|
|
|
||
Discount rate
|
4.25
|
%
|
|
4.51
|
%
|
Annual salary increase
|
4.46
|
|
|
4.46
|
|
|
Initial Cost Trend Rate
|
|
Ultimate Cost Trend Rate
|
|
Year That Ultimate Rate is Reached
|
||
Pre-65
|
6.50
|
%
|
|
4.50
|
%
|
|
2025
|
Post-65 medical
|
5.00
|
|
|
4.50
|
|
|
2025
|
Post-65 prescription
|
10.00
|
|
|
4.50
|
|
|
2025
|
|
1 Percent
Increase
|
|
1 Percent
Decrease
|
||||
|
(in millions)
|
||||||
Benefit obligation
|
$
|
4
|
|
|
$
|
3
|
|
Service and interest costs
|
—
|
|
|
—
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
480
|
|
|
$
|
491
|
|
Service cost
|
12
|
|
|
12
|
|
||
Interest cost
|
19
|
|
|
20
|
|
||
Benefits paid
|
(17
|
)
|
|
(20
|
)
|
||
Actuarial (gain) loss
|
23
|
|
|
(23
|
)
|
||
Balance at end of year
|
517
|
|
|
480
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
420
|
|
|
435
|
|
||
Actual return (loss) on plan assets
|
39
|
|
|
4
|
|
||
Employer contributions
|
49
|
|
|
1
|
|
||
Benefits paid
|
(17
|
)
|
|
(20
|
)
|
||
Fair value of plan assets at end of year
|
491
|
|
|
420
|
|
||
Accrued liability
|
$
|
(26
|
)
|
|
$
|
(60
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
153
|
|
|
$
|
142
|
|
Other current liabilities
|
(1
|
)
|
|
(1
|
)
|
||
Employee benefit obligations
|
(25
|
)
|
|
(59
|
)
|
|
2016
|
|
2015
|
|
Estimated Amortization in 2017
|
||||||
|
(in millions)
|
||||||||||
Prior service cost
|
$
|
3
|
|
|
$
|
2
|
|
|
$
|
1
|
|
Net (gain) loss
|
150
|
|
|
140
|
|
|
7
|
|
|||
Regulatory assets
|
$
|
153
|
|
|
$
|
142
|
|
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Regulatory assets:
|
|
|
|
|
|
||
Beginning balance
|
$
|
142
|
|
|
$
|
146
|
|
Net (gain) loss
|
16
|
|
|
6
|
|
||
Change in prior service costs
|
2
|
|
|
—
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
(1
|
)
|
|
(1
|
)
|
||
Amortization of net gain (loss)
|
(6
|
)
|
|
(9
|
)
|
||
Total reclassification adjustments
|
(7
|
)
|
|
(10
|
)
|
||
Total change
|
11
|
|
|
(4
|
)
|
||
Ending balance
|
$
|
153
|
|
|
$
|
142
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
12
|
|
|
$
|
12
|
|
|
$
|
10
|
|
Interest cost
|
19
|
|
|
20
|
|
|
19
|
|
|||
Expected return on plan assets
|
(34
|
)
|
|
(32
|
)
|
|
(28
|
)
|
|||
Recognized net (gain) loss
|
6
|
|
|
9
|
|
|
5
|
|
|||
Net amortization
|
1
|
|
|
1
|
|
|
1
|
|
|||
Net periodic pension cost
|
$
|
4
|
|
|
$
|
10
|
|
|
$
|
7
|
|
|
Benefit
Payments
|
||
|
(in millions)
|
||
2017
|
$
|
20
|
|
2018
|
22
|
|
|
2019
|
23
|
|
|
2020
|
24
|
|
|
2021
|
26
|
|
|
2022 to 2026
|
149
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
81
|
|
|
$
|
78
|
|
Service cost
|
1
|
|
|
1
|
|
||
Interest cost
|
3
|
|
|
3
|
|
||
Benefits paid
|
(4
|
)
|
|
(4
|
)
|
||
Actuarial (gain) loss
|
2
|
|
|
(1
|
)
|
||
Plan amendment
|
—
|
|
|
4
|
|
||
Balance at end of year
|
83
|
|
|
81
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
17
|
|
|
18
|
|
||
Actual return (loss) on plan assets
|
2
|
|
|
—
|
|
||
Employer contributions
|
3
|
|
|
3
|
|
||
Benefits paid
|
(4
|
)
|
|
(4
|
)
|
||
Fair value of plan assets at end of year
|
18
|
|
|
17
|
|
||
Accrued liability
|
$
|
(65
|
)
|
|
$
|
(64
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
11
|
|
|
$
|
10
|
|
Other current liabilities
|
(1
|
)
|
|
(1
|
)
|
||
Other regulatory liabilities, deferred
|
(4
|
)
|
|
(5
|
)
|
||
Employee benefit obligations
|
(64
|
)
|
|
(63
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Net regulatory assets (liabilities):
|
|
|
|
|
|
||
Beginning balance
|
$
|
5
|
|
|
$
|
2
|
|
Net (gain) loss
|
2
|
|
|
1
|
|
||
Change in prior service costs
|
—
|
|
|
2
|
|
||
Total change
|
2
|
|
|
3
|
|
||
Ending balance
|
$
|
7
|
|
|
$
|
5
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
1
|
|
Interest cost
|
3
|
|
|
3
|
|
|
3
|
|
|||
Expected return on plan assets
|
(1
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|||
Net periodic postretirement benefit cost
|
$
|
3
|
|
|
$
|
3
|
|
|
$
|
3
|
|
|
Benefit
Payments
|
|
Subsidy
Receipts
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
2017
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
5
|
|
2018
|
5
|
|
|
—
|
|
|
5
|
|
|||
2019
|
6
|
|
|
(1
|
)
|
|
5
|
|
|||
2020
|
6
|
|
|
(1
|
)
|
|
5
|
|
|||
2021
|
6
|
|
|
(1
|
)
|
|
5
|
|
|||
2022 to 2026
|
30
|
|
|
(3
|
)
|
|
27
|
|
|
Target
|
|
2016
|
|
2015
|
|||
Pension plan assets:
|
|
|
|
|
|
|||
Domestic equity
|
26
|
%
|
|
29
|
%
|
|
30
|
%
|
International equity
|
25
|
|
|
22
|
|
|
23
|
|
Fixed income
|
23
|
|
|
29
|
|
|
23
|
|
Special situations
|
3
|
|
|
2
|
|
|
2
|
|
Real estate investments
|
14
|
|
|
13
|
|
|
16
|
|
Private equity
|
9
|
|
|
5
|
|
|
6
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Other postretirement benefit plan assets:
|
|
|
|
|
|
|||
Domestic equity
|
25
|
%
|
|
28
|
%
|
|
29
|
%
|
International equity
|
24
|
|
|
21
|
|
|
22
|
|
Domestic fixed income
|
25
|
|
|
31
|
|
|
25
|
|
Special situations
|
3
|
|
|
2
|
|
|
2
|
|
Real estate investments
|
14
|
|
|
13
|
|
|
16
|
|
Private equity
|
9
|
|
|
5
|
|
|
6
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
•
|
Domestic equity.
A mix of large and small capitalization stocks with generally an equal distribution of value and growth attributes, managed both actively and through passive index approaches.
|
•
|
International equity.
A mix of growth stocks and value stocks with both developed and emerging market exposure, managed both actively and through passive index approaches.
|
•
|
Fixed income.
A mix of domestic and international bonds.
|
•
|
Special situations.
Investments in opportunistic strategies with the objective of diversifying and enhancing returns and exploiting short-term inefficiencies as well as investments in promising new strategies of a longer-term nature.
|
•
|
Real estate investments.
Investments in traditional private market, equity-oriented investments in real properties (indirectly through pooled funds or partnerships) and in publicly traded real estate securities.
|
•
|
Private equity.
Investments in private partnerships that invest in private or public securities typically through privately-negotiated and/or structured transactions, including leveraged buyouts, venture capital, and distressed debt.
|
•
|
Domestic and international equity.
Investments in equity securities such as common stocks, American depositary receipts, and real estate investment trusts that trade on a public exchange are classified as Level 1 investments and are valued at the closing price in the active market. Equity investments with unpublished prices (i.e. pooled funds) are valued as Level 2, when the underlying holdings used to value the investment are comprised of Level 1 or Level 2 equity securities.
|
•
|
Fixed income.
Investments in fixed income securities are generally classified as Level 2 investments and are valued based on prices reported in the market place. Additionally, the value of fixed income securities takes into consideration certain items such as broker quotes, spreads, yield curves, interest rates, and discount rates that apply to the term of a specific instrument.
|
•
|
Real estate investments, private equity, and special situations investments.
Investments in real estate, private equity, and special situations are generally classified as Net Asset Value as a Practical Expedient, since the underlying assets typically do not have publicly available observable inputs. The fund manager values the assets using various inputs and techniques depending on the nature of the underlying investments. Techniques may include purchase multiples for comparable transactions, comparable public company trading multiples, discounted cash flow analysis, prevailing market capitalization rates, recent sales of comparable investments, and independent third-party appraisals. The fair value of partnerships is determined by aggregating the value of the underlying assets less liabilities.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
93
|
|
|
$
|
43
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
136
|
|
International equity
(*)
|
57
|
|
|
52
|
|
|
—
|
|
|
—
|
|
|
109
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
27
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Corporate bonds
|
—
|
|
|
47
|
|
|
—
|
|
|
—
|
|
|
47
|
|
|||||
Pooled funds
|
—
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|||||
Cash equivalents and other
|
46
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46
|
|
|||||
Real estate investments
|
14
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
67
|
|
|||||
Special situations
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
8
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
25
|
|
|
25
|
|
|||||
Total
|
$
|
210
|
|
|
$
|
194
|
|
|
$
|
—
|
|
|
$
|
86
|
|
|
$
|
490
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
73
|
|
|
$
|
31
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
104
|
|
International equity
(*)
|
54
|
|
|
45
|
|
|
—
|
|
|
—
|
|
|
99
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
21
|
|
|
—
|
|
|
—
|
|
|
21
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|||||
Corporate bonds
|
—
|
|
|
51
|
|
|
—
|
|
|
—
|
|
|
51
|
|
|||||
Pooled funds
|
—
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|||||
Cash equivalents and other
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|||||
Real estate investments
|
14
|
|
|
—
|
|
|
—
|
|
|
55
|
|
|
69
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
29
|
|
|
29
|
|
|||||
Total
|
$
|
141
|
|
|
$
|
187
|
|
|
$
|
—
|
|
|
$
|
84
|
|
|
$
|
412
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
3
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5
|
|
International equity
(*)
|
2
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Corporate bonds
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Pooled funds
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Cash equivalents and other
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Real estate investments
|
1
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
3
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||
Total
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
19
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
3
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
International equity
(*)
|
2
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Corporate bonds
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Pooled funds
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Cash equivalents and other
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Real estate investments
|
1
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
3
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||
Total
|
$
|
7
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
17
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Plant Scherer
Unit 3 (coal)
|
|
Plant Daniel Units 1 & 2 (coal)
|
|||||
|
(in millions)
|
|||||||
Plant in service
|
$
|
398
|
|
|
|
$
|
680
|
|
Accumulated depreciation
|
143
|
|
|
|
202
|
|
||
Construction work in progress
|
7
|
|
|
|
7
|
|
||
Company ownership
|
25
|
%
|
|
|
50
|
%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Federal -
|
|
|
|
|
|
||||||
Current
|
$
|
34
|
|
|
$
|
(3
|
)
|
|
$
|
23
|
|
Deferred
|
45
|
|
|
80
|
|
|
52
|
|
|||
|
79
|
|
|
77
|
|
|
75
|
|
|||
State -
|
|
|
|
|
|
||||||
Current
|
—
|
|
|
5
|
|
|
—
|
|
|||
Deferred
|
12
|
|
|
10
|
|
|
13
|
|
|||
|
12
|
|
|
15
|
|
|
13
|
|
|||
Total
|
$
|
91
|
|
|
$
|
92
|
|
|
$
|
88
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Deferred tax liabilities-
|
|
|
|
||||
Accelerated depreciation
|
$
|
834
|
|
|
$
|
812
|
|
Property basis differences
|
123
|
|
|
133
|
|
||
Pension and other employee benefits
|
58
|
|
|
39
|
|
||
Regulatory assets
|
45
|
|
|
16
|
|
||
Regulatory assets associated with employee benefit obligations
|
65
|
|
|
59
|
|
||
Regulatory assets associated with asset retirement obligations
|
55
|
|
|
40
|
|
||
Other
|
12
|
|
|
10
|
|
||
Total
|
1,192
|
|
|
1,109
|
|
||
Deferred tax assets-
|
|
|
|
||||
Federal effect of state deferred taxes
|
37
|
|
|
33
|
|
||
Postretirement benefits
|
26
|
|
|
26
|
|
||
Pension and other employee benefits
|
72
|
|
|
65
|
|
||
Property reserve
|
17
|
|
|
15
|
|
||
Asset retirement obligations
|
55
|
|
|
40
|
|
||
Alternative minimum tax carryforward
|
18
|
|
|
18
|
|
||
Other
|
19
|
|
|
19
|
|
||
Total
|
244
|
|
|
216
|
|
||
Accumulated deferred income taxes
|
$
|
948
|
|
|
$
|
893
|
|
|
2016
|
|
2015
|
|
2014
|
Federal statutory rate
|
35.0%
|
|
35.0%
|
|
35.0%
|
State income tax, net of federal deduction
|
3.4
|
|
3.9
|
|
3.5
|
Non-deductible book depreciation
|
0.6
|
|
0.5
|
|
0.4
|
Differences in prior years' deferred and current tax rates
|
(0.1)
|
|
(0.1)
|
|
(0.1)
|
AFUDC equity
|
—
|
|
(1.8)
|
|
(1.8)
|
Other, net
|
0.6
|
|
(0.6)
|
|
0.1
|
Effective income tax rate
|
39.5%
|
|
36.9%
|
|
37.1%
|
Expires
|
|
|
|
|
|
Executable
Term Loans
|
|
Expires Within One Year
|
|||||||||||||||||||||
2017
|
2018
|
|
Total
|
|
Unused
|
|
One
Year
|
|
Two
Years
|
|
Term Out
|
|
No Term Out
|
||||||||||||||||
(in millions)
|
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
|||||||||||||||||||||||
$
|
85
|
|
$
|
195
|
|
|
$
|
280
|
|
|
$
|
280
|
|
|
$
|
45
|
|
|
$
|
—
|
|
|
$
|
25
|
|
|
$
|
60
|
|
|
Short-term Debt at the
End of the Period
|
||||
|
Amount Outstanding
|
|
Weighted Average Interest Rate
|
||
|
(in millions)
|
|
|
||
December 31, 2016:
|
|
|
|
||
Commercial paper
|
$
|
168
|
|
|
1.1%
|
Short-term bank debt
|
100
|
|
|
1.5%
|
|
Total
|
$
|
268
|
|
|
1.2%
|
December 31, 2015:
|
|
|
|
||
Commercial paper
|
$
|
142
|
|
|
0.7%
|
|
Operating Lease PPA
|
||
|
(in millions)
|
||
2017
|
$
|
79
|
|
2018
|
79
|
|
|
2019
|
79
|
|
|
2020
|
79
|
|
|
2021
|
79
|
|
|
2022 and thereafter
|
112
|
|
|
Total
|
$
|
507
|
|
|
Minimum Lease Payments
|
||||||||||
|
Barges &
Railcars
|
|
Other
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
2017
|
$
|
7
|
|
|
$
|
1
|
|
|
$
|
8
|
|
2018
|
5
|
|
|
1
|
|
|
6
|
|
|||
2019
|
—
|
|
|
1
|
|
|
1
|
|
|||
2020
|
—
|
|
|
—
|
|
|
—
|
|
|||
2021
|
—
|
|
|
—
|
|
|
—
|
|
|||
2022 and thereafter
|
—
|
|
|
1
|
|
|
1
|
|
|||
Total
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
16
|
|
•
|
Level 1 consists of observable market data in an active market for identical assets or liabilities.
|
•
|
Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.
|
•
|
Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
|
||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
20
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20
|
|
Energy-related derivatives
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||
Total
|
$
|
20
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
25
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
29
|
|
|
$
|
—
|
|
|
$
|
29
|
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant
Other
Observable
Inputs
|
|
Significant
Unobservable
Inputs
|
|
|
||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Interest rate derivatives
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Cash equivalents
|
18
|
|
|
—
|
|
|
—
|
|
|
18
|
|
||||
Total
|
$
|
18
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
19
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
100
|
|
|
$
|
—
|
|
|
$
|
100
|
|
|
Carrying
Amount
|
|
Fair
Value
|
||||
|
(in millions)
|
||||||
Long-term debt:
|
|
|
|
||||
2016
|
$
|
1,074
|
|
|
$
|
1,097
|
|
2015
|
$
|
1,303
|
|
|
$
|
1,339
|
|
•
|
Regulatory Hedges
— Energy-related derivative contracts which are designated as regulatory hedges relate primarily to the Company's fuel-hedging programs, where gains and losses are initially recorded as regulatory liabilities and assets, respectively, and then are included in fuel expense as the underlying fuel is used in operations and ultimately recovered through the fuel cost recovery clause.
|
•
|
Cash Flow Hedges
— Gains and losses on energy-related derivatives designated as cash flow hedges (which are mainly used to hedge anticipated purchases and sales) are initially deferred in OCI before being recognized in the statements of income in the same period as the hedged transactions are reflected in earnings.
|
•
|
Not Designated
— Gains and losses on energy-related derivative contracts that are not designated or fail to qualify as hedges are recognized in the statements of income as incurred.
|
|
Notional
Amount |
|
Interest
Rate Received |
|
Weighted Average Interest
Rate Paid |
|
Hedge
Maturity Date |
|
Fair Value
Gain (Loss) December 31, 2016 |
||||
|
(in millions)
|
|
|
|
|
|
|
|
(in millions)
|
||||
Cash Flow Hedges of Forecasted Debt
|
|
|
|
|
|
|
|
|
|||||
|
$
|
80
|
|
|
3-month LIBOR
|
|
2.32%
|
|
December 2026
|
|
$
|
—
|
|
|
2016
|
2015
|
||||||||||
Derivative Category and Balance Sheet Location
|
Assets
|
Liabilities
|
Assets
|
Liabilities
|
||||||||
|
(in millions)
|
|||||||||||
Derivatives designated as hedging instruments for regulatory purposes
|
|
|
|
|
||||||||
Energy-related derivatives:
|
|
|
|
|
||||||||
Other current assets/Liabilities from risk management activities
|
$
|
4
|
|
$
|
12
|
|
$
|
—
|
|
$
|
49
|
|
Other deferred charges and assets/Other deferred credits and liabilities
|
1
|
|
17
|
|
—
|
|
51
|
|
||||
Total derivatives designated as hedging instruments for regulatory purposes
|
$
|
5
|
|
$
|
29
|
|
$
|
—
|
|
$
|
100
|
|
Derivatives designated as hedging instruments in cash flow and fair value hedges
|
|
|
|
|
||||||||
Interest rate derivatives:
|
|
|
|
|
||||||||
Other current assets/Liabilities from risk management activities
|
—
|
|
—
|
|
1
|
|
—
|
|
||||
Gross amounts recognized
|
$
|
5
|
|
$
|
29
|
|
$
|
1
|
|
$
|
100
|
|
Gross amounts offset
|
$
|
(4
|
)
|
$
|
(4
|
)
|
$
|
—
|
|
$
|
—
|
|
Net amounts recognized in the Balance Sheets
(*)
|
$
|
1
|
|
$
|
25
|
|
$
|
1
|
|
$
|
100
|
|
(*)
|
At
December 31, 2015
, the fair value amounts for derivative contracts subject to netting arrangements were presented gross on the balance sheet.
|
|
Unrealized Losses
|
|
Unrealized Gains
|
||||||||||||||
Derivative Category
|
Balance Sheet
Location
|
2016
|
|
2015
|
|
Balance Sheet
Location
|
2016
|
|
2015
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Energy-related derivatives:
(*)
|
Other regulatory assets, current
|
$
|
(9
|
)
|
|
$
|
(49
|
)
|
|
Other regulatory liabilities, current
|
$
|
1
|
|
|
$
|
—
|
|
|
Other regulatory assets, deferred
|
(16
|
)
|
|
(51
|
)
|
|
Other regulatory liabilities, deferred
|
—
|
|
|
—
|
|
||||
Total energy-related derivative gains (losses)
|
|
$
|
(25
|
)
|
|
$
|
(100
|
)
|
|
|
$
|
1
|
|
|
$
|
—
|
|
(*)
|
At
December 31, 2016
, the unrealized gains and losses for derivative contracts subject to netting arrangements were presented net on the balance sheet. At
December 31, 2015
, the unrealized gains and losses for derivative contracts were presented gross on the balance sheet.
|
Derivatives in Cash
Flow Hedging Relationships
|
Gain (Loss) Recognized in
OCI on Derivative
|
|
Gain (Loss) Reclassified from Accumulated
OCI into Income (Effective Portion)
|
|||||||||||||||||||||
(Effective Portion)
|
|
|
Amount
|
|||||||||||||||||||||
Derivative Category
|
2016
|
|
2015
|
|
2014
|
|
Statements of Income Location
|
2016
|
|
2015
|
|
2014
|
||||||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||||||||||
Interest rate derivatives
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
Interest expense, net of amounts capitalized
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
Quarter Ended
|
Operating
Revenues
|
|
Operating
Income
|
|
Net Income After Dividends on Preference Stock
|
||||||
|
(in millions)
|
||||||||||
March 2016
|
$
|
335
|
|
|
$
|
65
|
|
|
$
|
29
|
|
June 2016
|
365
|
|
|
74
|
|
|
34
|
|
|||
September 2016
|
436
|
|
|
90
|
|
|
45
|
|
|||
December 2016
|
349
|
|
|
54
|
|
|
23
|
|
|||
|
|
|
|
|
|
||||||
March 2015
|
$
|
357
|
|
|
$
|
72
|
|
|
$
|
37
|
|
June 2015
|
384
|
|
|
69
|
|
|
35
|
|
|||
September 2015
|
429
|
|
|
91
|
|
|
48
|
|
|||
December 2015
|
313
|
|
|
58
|
|
|
28
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (in millions)
|
$
|
1,485
|
|
|
$
|
1,483
|
|
|
$
|
1,590
|
|
|
$
|
1,440
|
|
|
$
|
1,440
|
|
Net Income After Dividends
on Preference Stock (in millions)
|
$
|
131
|
|
|
$
|
148
|
|
|
$
|
140
|
|
|
$
|
124
|
|
|
$
|
126
|
|
Cash Dividends
on Common Stock (in millions)
|
$
|
120
|
|
|
$
|
130
|
|
|
$
|
123
|
|
|
$
|
115
|
|
|
$
|
116
|
|
Return on Average Common Equity (percent)
|
9.52
|
|
|
11.11
|
|
|
11.02
|
|
|
10.30
|
|
|
10.92
|
|
|||||
Total Assets (in millions)
(a)(b)
|
$
|
4,822
|
|
|
$
|
4,920
|
|
|
$
|
4,697
|
|
|
$
|
4,321
|
|
|
$
|
4,167
|
|
Gross Property Additions (in millions)
|
$
|
179
|
|
|
$
|
247
|
|
|
$
|
361
|
|
|
$
|
305
|
|
|
$
|
325
|
|
Capitalization (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
$
|
1,389
|
|
|
$
|
1,355
|
|
|
$
|
1,309
|
|
|
$
|
1,235
|
|
|
$
|
1,181
|
|
Preference stock
|
147
|
|
|
147
|
|
|
147
|
|
|
147
|
|
|
98
|
|
|||||
Long-term debt
(a)
|
987
|
|
|
1,193
|
|
|
1,362
|
|
|
1,150
|
|
|
1,178
|
|
|||||
Total (excluding amounts due within one year)
|
$
|
2,523
|
|
|
$
|
2,695
|
|
|
$
|
2,818
|
|
|
$
|
2,532
|
|
|
$
|
2,457
|
|
Capitalization Ratios (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
55.1
|
|
|
50.3
|
|
|
46.5
|
|
|
48.8
|
|
|
48.1
|
|
|||||
Preference stock
|
5.8
|
|
|
5.4
|
|
|
5.2
|
|
|
5.8
|
|
|
4.0
|
|
|||||
Long-term debt
(a)
|
39.1
|
|
|
44.3
|
|
|
48.3
|
|
|
45.4
|
|
|
47.9
|
|
|||||
Total (excluding amounts due within one year)
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|||||
Customers (year-end):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
398,501
|
|
|
393,149
|
|
|
388,292
|
|
|
383,980
|
|
|
379,922
|
|
|||||
Commercial
|
56,091
|
|
|
55,460
|
|
|
54,892
|
|
|
54,567
|
|
|
53,808
|
|
|||||
Industrial
|
254
|
|
|
248
|
|
|
260
|
|
|
260
|
|
|
264
|
|
|||||
Other
|
569
|
|
|
614
|
|
|
603
|
|
|
582
|
|
|
577
|
|
|||||
Total
|
455,415
|
|
|
449,471
|
|
|
444,047
|
|
|
439,389
|
|
|
434,571
|
|
|||||
Employees (year-end)
|
1,352
|
|
|
1,391
|
|
|
1,384
|
|
|
1,410
|
|
|
1,416
|
|
(a)
|
A reclassification of debt issuance costs from Total Assets to Long-term debt of $8 million, $8 million, and $8 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
(b)
|
A reclassification of deferred tax assets from Total Assets of $3 million, $8 million, and $2 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
$
|
714
|
|
|
$
|
698
|
|
|
$
|
700
|
|
|
$
|
632
|
|
|
$
|
609
|
|
Commercial
|
410
|
|
|
403
|
|
|
408
|
|
|
395
|
|
|
390
|
|
|||||
Industrial
|
152
|
|
|
144
|
|
|
153
|
|
|
139
|
|
|
140
|
|
|||||
Other
|
5
|
|
|
4
|
|
|
6
|
|
|
4
|
|
|
5
|
|
|||||
Total retail
|
1,281
|
|
|
1,249
|
|
|
1,267
|
|
|
1,170
|
|
|
1,144
|
|
|||||
Wholesale — non-affiliates
|
61
|
|
|
107
|
|
|
129
|
|
|
109
|
|
|
107
|
|
|||||
Wholesale — affiliates
|
75
|
|
|
58
|
|
|
130
|
|
|
100
|
|
|
124
|
|
|||||
Total revenues from sales of electricity
|
1,417
|
|
|
1,414
|
|
|
1,526
|
|
|
1,379
|
|
|
1,375
|
|
|||||
Other revenues
|
68
|
|
|
69
|
|
|
64
|
|
|
61
|
|
|
65
|
|
|||||
Total
|
$
|
1,485
|
|
|
$
|
1,483
|
|
|
$
|
1,590
|
|
|
$
|
1,440
|
|
|
$
|
1,440
|
|
Kilowatt-Hour Sales (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
5,358
|
|
|
5,365
|
|
|
5,362
|
|
|
5,089
|
|
|
5,054
|
|
|||||
Commercial
|
3,869
|
|
|
3,898
|
|
|
3,838
|
|
|
3,810
|
|
|
3,859
|
|
|||||
Industrial
|
1,830
|
|
|
1,798
|
|
|
1,849
|
|
|
1,700
|
|
|
1,725
|
|
|||||
Other
|
25
|
|
|
25
|
|
|
26
|
|
|
21
|
|
|
25
|
|
|||||
Total retail
|
11,082
|
|
|
11,086
|
|
|
11,075
|
|
|
10,620
|
|
|
10,663
|
|
|||||
Wholesale — non-affiliates
|
751
|
|
|
1,040
|
|
|
1,670
|
|
|
1,163
|
|
|
977
|
|
|||||
Wholesale — affiliates
|
2,784
|
|
|
1,906
|
|
|
3,284
|
|
|
3,127
|
|
|
4,370
|
|
|||||
Total
|
14,617
|
|
|
14,032
|
|
|
16,029
|
|
|
14,910
|
|
|
16,010
|
|
|||||
Average Revenue Per Kilowatt-Hour (cents):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
13.33
|
|
|
13.01
|
|
|
13.06
|
|
|
12.43
|
|
|
12.06
|
|
|||||
Commercial
|
10.60
|
|
|
10.34
|
|
|
10.64
|
|
|
10.37
|
|
|
10.11
|
|
|||||
Industrial
|
8.31
|
|
|
8.01
|
|
|
8.28
|
|
|
8.15
|
|
|
8.14
|
|
|||||
Total retail
|
11.56
|
|
|
11.27
|
|
|
11.44
|
|
|
11.02
|
|
|
10.73
|
|
|||||
Wholesale
|
3.85
|
|
|
5.60
|
|
|
5.23
|
|
|
4.87
|
|
|
4.31
|
|
|||||
Total sales
|
9.69
|
|
|
10.08
|
|
|
9.52
|
|
|
9.25
|
|
|
8.59
|
|
|||||
Residential Average Annual
|
|
|
|
|
|
|
|
|
|
||||||||||
Kilowatt-Hour Use Per Customer
|
13,515
|
|
|
13,705
|
|
|
13,865
|
|
|
13,301
|
|
|
13,303
|
|
|||||
Residential Average Annual
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue Per Customer
|
$
|
1,801
|
|
|
$
|
1,783
|
|
|
$
|
1,811
|
|
|
$
|
1,653
|
|
|
$
|
1,604
|
|
Plant Nameplate Capacity
|
|
|
|
|
|
|
|
|
|
||||||||||
Ratings (year-end) (megawatts)
|
2,278
|
|
|
2,583
|
|
|
2,663
|
|
|
2,663
|
|
|
2,663
|
|
|||||
Maximum Peak-Hour Demand (megawatts):
|
|
|
|
|
|
|
|
|
|
||||||||||
Winter
|
2,033
|
|
|
2,488
|
|
|
2,684
|
|
|
1,729
|
|
|
2,130
|
|
|||||
Summer
|
2,503
|
|
|
2,491
|
|
|
2,424
|
|
|
2,356
|
|
|
2,344
|
|
|||||
Annual Load Factor (percent)
|
54.7
|
|
|
54.9
|
|
|
51.1
|
|
|
55.9
|
|
|
56.3
|
|
|||||
Plant Availability Fossil-Steam (percent)
|
81.0
|
|
|
88.3
|
|
|
89.4
|
|
|
92.8
|
|
|
82.5
|
|
|||||
Source of Energy Supply (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Coal
|
31.0
|
|
|
33.5
|
|
|
44.5
|
|
|
36.4
|
|
|
34.6
|
|
|||||
Gas
|
23.2
|
|
|
25.6
|
|
|
22.2
|
|
|
23.0
|
|
|
23.5
|
|
|||||
Purchased power —
|
|
|
|
|
|
|
|
|
|
||||||||||
From non-affiliates
|
41.1
|
|
|
30.4
|
|
|
28.9
|
|
|
37.0
|
|
|
40.2
|
|
|||||
From affiliates
|
4.7
|
|
|
10.5
|
|
|
4.4
|
|
|
3.6
|
|
|
1.7
|
|
|||||
Total
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
Term
|
Meaning
|
2012 MPSC CPCN Order
|
A detailed order issued by the Mississippi PSC in April 2012 confirming the CPCN originally approved by the Mississippi PSC in 2010 authorizing acquisition, construction, and operation of the Kemper IGCC
|
AFUDC
|
Allowance for funds used during construction
|
Alabama Power
|
Alabama Power Company
|
ARO
|
Asset retirement obligation
|
ASC
|
Accounting Standards Codification
|
ASU
|
Accounting Standards Update
|
Baseload Act
|
State of Mississippi legislation designed to enhance the Mississippi PSC's authority to facilitate development and construction of baseload generation in the State of Mississippi
|
CCR
|
Coal combustion residuals
|
Clean Air Act
|
Clean Air Act Amendments of 1990
|
CO
2
|
Carbon dioxide
|
CPCN
|
Certificate of public convenience and necessity
|
CWIP
|
Construction work in progress
|
DOE
|
U.S. Department of Energy
|
ECM
|
Energy cost management clause
|
ECO
|
Environmental compliance overview
|
EPA
|
U.S. Environmental Protection Agency
|
FASB
|
Financial Accounting Standards Board
|
FERC
|
Federal Energy Regulatory Commission
|
GAAP
|
U.S. generally accepted accounting principles
|
Georgia Power
|
Georgia Power Company
|
Gulf Power
|
Gulf Power Company
|
IGCC
|
Integrated coal gasification combined cycle
|
IRS
|
Internal Revenue Service
|
ITC
|
Investment tax credit
|
Kemper IGCC
|
IGCC facility under construction in Kemper County, Mississippi
|
KWH
|
Kilowatt-hour
|
LIBOR
|
London Interbank Offered Rate
|
Mirror CWIP
|
A regulatory liability used by Mississippi Power to record customer refunds resulting from a 2015 Mississippi PSC order
|
mmBtu
|
Million British thermal units
|
Moody's
|
Moody's Investors Service, Inc.
|
MPUS
|
Mississippi Public Utilities Staff
|
MRA
|
Municipal and Rural Associations
|
MW
|
Megawatt
|
OCI
|
Other comprehensive income
|
PEP
|
Performance evaluation plan
|
Plant Daniel Units 3 and 4
|
Combined cycle Units 3 and 4 at Plant Daniel
|
power pool
|
The operating arrangement whereby the integrated generating resources of the traditional electric operating companies and Southern Power (excluding subsidiaries) are subject to joint commitment and dispatch in order to serve their combined load obligations
|
PPA
|
Power purchase agreement
|
PSC
|
Public Service Commission
|
Term
|
Meaning
|
ROE
|
Return on equity
|
S&P
|
S&P Global Ratings, a division of S&P Global Inc.
|
scrubber
|
Flue gas desulfurization system
|
SCS
|
Southern Company Services, Inc. (the Southern Company system service company)
|
SEC
|
U.S. Securities and Exchange Commission
|
SMEPA
|
South Mississippi Electric Power Association (now known as Cooperative Energy)
|
Southern Company
|
The Southern Company
|
Southern Company Gas
|
Southern Company Gas (formerly known as AGL Resources Inc.) and its subsidiaries
|
Southern Company system
|
Southern Company, the traditional electric operating companies, Southern Power, Southern Company Gas (as of July 1, 2016), Southern Electric Generating Company, Southern Nuclear, SCS, Southern LINC, PowerSecure, Inc. (as of May 9, 2016), and other subsidiaries
|
Southern LINC
|
Southern Communications Services, Inc.
|
Southern Nuclear
|
Southern Nuclear Operating Company, Inc.
|
Southern Power
|
Southern Power Company and its subsidiaries
|
SRR
|
System Restoration Rider
|
traditional electric operating companies
|
Alabama Power, Georgia Power, Gulf Power, and Mississippi Power Company
|
|
Amount
|
|
Increase (Decrease)
from Prior Year
|
||||||||
|
2016
|
|
2016
|
|
2015
|
||||||
|
(in millions)
|
||||||||||
Operating revenues
|
$
|
1,163
|
|
|
$
|
25
|
|
|
$
|
(105
|
)
|
Fuel
|
343
|
|
|
(100
|
)
|
|
(131
|
)
|
|||
Purchased power
|
34
|
|
|
22
|
|
|
(31
|
)
|
|||
Other operations and maintenance
|
312
|
|
|
38
|
|
|
3
|
|
|||
Depreciation and amortization
|
132
|
|
|
9
|
|
|
26
|
|
|||
Taxes other than income taxes
|
109
|
|
|
15
|
|
|
15
|
|
|||
Estimated loss on Kemper IGCC
|
428
|
|
|
63
|
|
|
(503
|
)
|
|||
Total operating expenses
|
1,358
|
|
|
47
|
|
|
(621
|
)
|
|||
Operating income
|
(195
|
)
|
|
(22
|
)
|
|
516
|
|
|||
Allowance for equity funds used during construction
|
124
|
|
|
14
|
|
|
(26
|
)
|
|||
Interest expense, net of amounts capitalized
|
74
|
|
|
67
|
|
|
(38
|
)
|
|||
Other income (expense), net
|
(7
|
)
|
|
1
|
|
|
6
|
|
|||
Income taxes (benefit)
|
(104
|
)
|
|
(32
|
)
|
|
213
|
|
|||
Net income (loss)
|
(48
|
)
|
|
(42
|
)
|
|
321
|
|
|||
Dividends on preferred stock
|
2
|
|
|
—
|
|
|
—
|
|
|||
Net loss after dividends on preferred stock
|
$
|
(50
|
)
|
|
$
|
(42
|
)
|
|
$
|
321
|
|
|
Amount
|
||||||
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Retail — prior year
|
$
|
776
|
|
|
$
|
795
|
|
Estimated change resulting from —
|
|
|
|
||||
Rates and pricing
|
96
|
|
|
61
|
|
||
Sales decline
|
(4
|
)
|
|
(3
|
)
|
||
Weather
|
8
|
|
|
(1
|
)
|
||
Fuel and other cost recovery
|
(17
|
)
|
|
(76
|
)
|
||
Retail — current year
|
859
|
|
|
776
|
|
||
Wholesale revenues —
|
|
|
|
||||
Non-affiliates
|
261
|
|
|
270
|
|
||
Affiliates
|
26
|
|
|
76
|
|
||
Total wholesale revenues
|
287
|
|
|
346
|
|
||
Other operating revenues
|
17
|
|
|
16
|
|
||
Total operating revenues
|
$
|
1,163
|
|
|
$
|
1,138
|
|
Percent change
|
2.2
|
%
|
|
(8.4
|
)%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Capacity and other
|
$
|
157
|
|
|
$
|
158
|
|
|
$
|
160
|
|
Energy
|
104
|
|
|
112
|
|
|
163
|
|
|||
Total non-affiliated
|
$
|
261
|
|
|
$
|
270
|
|
|
$
|
323
|
|
(*)
|
In the first quarter 2015, the Company updated the methodology to estimate the unbilled revenue allocation among customer classes. This change did not have a material impact on net income. The KWH sales variances in the above table reflect an adjustment to the estimated allocation of the Company's unbilled 2014 and first quarter 2015 KWH sales among customer classes that is consistent with the actual allocation in 2015 and 2016, respectively. Without this adjustment, 2016 weather-adjusted residential sales decreased 1.0%, commercial sales decreased 0.6%, and industrial KWH sales decreased 1.0% as compared to the corresponding period in 2015. Without this adjustment, 2015 weather-adjusted residential sales decreased 1.8%, commercial sales decreased 2.1%, and industrial KWH sales increased 0.3% as compared to the corresponding period in 2014.
|
|
2016
|
|
2015
|
|
2014
|
|||
Total generation
(in millions of KWHs)
|
14,514
|
|
|
17,014
|
|
|
16,881
|
|
Total purchased power
(in millions of KWHs)
|
1,574
|
|
|
539
|
|
|
886
|
|
Sources of generation
(percent)
–
|
|
|
|
|
|
|||
Coal
|
9
|
|
|
17
|
|
|
42
|
|
Gas
|
91
|
|
|
83
|
|
|
58
|
|
Cost of fuel, generated
(in cents per net KWH)
–
|
|
|
|
|
|
|||
Coal
|
3.91
|
|
|
3.71
|
|
|
3.96
|
|
Gas
|
2.41
|
|
|
2.58
|
|
|
3.37
|
|
Average cost of fuel, generated
(in cents per net KWH)
|
2.55
|
|
|
2.78
|
|
|
3.64
|
|
Average cost of purchased power
(in cents per net KWH)
|
3.07
|
|
|
2.17
|
|
|
4.85
|
|
Cost Category
|
2010 Project Estimate
(a)
|
|
Current Cost Estimate
(b)
|
|
Actual Costs
|
||||||
|
(in billions)
|
||||||||||
Plant Subject to Cost Cap
(c)(e)
|
$
|
2.40
|
|
|
$
|
5.64
|
|
|
$
|
5.44
|
|
Lignite Mine and Equipment
|
0.21
|
|
|
0.23
|
|
|
0.23
|
|
|||
CO
2
Pipeline Facilities
|
0.14
|
|
|
0.11
|
|
|
0.11
|
|
|||
AFUDC
(d)
|
0.17
|
|
|
0.79
|
|
|
0.75
|
|
|||
Combined Cycle and Related Assets Placed in
Service – Incremental
(e)
|
—
|
|
|
0.04
|
|
|
0.04
|
|
|||
General Exceptions
|
0.05
|
|
|
0.10
|
|
|
0.09
|
|
|||
Deferred Costs
(e)
|
—
|
|
|
0.22
|
|
|
0.21
|
|
|||
Additional DOE Grants
|
—
|
|
|
(0.14
|
)
|
|
(0.14
|
)
|
|||
Total Kemper IGCC
(f)
|
$
|
2.97
|
|
|
$
|
6.99
|
|
|
$
|
6.73
|
|
(a)
|
The 2010 Project Estimate is the certificated cost estimate adjusted to include the certificated estimate for the CO
2
pipeline facilities approved in 2011 by the Mississippi PSC, as well as the lignite mine and equipment, AFUDC, and general exceptions.
|
(b)
|
Amounts in the Current Cost Estimate include certain estimated post-in-service costs which are expected to be subject to the cost cap.
|
(c)
|
The 2012 MPSC CPCN Order approved a construction cost cap of up to
$2.88 billion
, net of the Initial DOE Grants and excluding the Cost Cap Exceptions.
The Current Cost Estimate and the Actual Costs include non-incremental operating and maintenance costs related to the combined cycle and associated
|
(d)
|
The Company's
2010 Project Estimate included recovery of financing costs during construction rather than the accrual of AFUDC. This approach was not approved by the Mississippi PSC as described in "Rate Recovery of Kemper IGCC Costs
–
2013 MPSC Rate Order." The Current Cost Estimate also reflects the impact of a settlement agreement with the wholesale customers for cost-based rates under FERC's jurisdiction. See "FERC Matters" herein for additional information.
|
(e)
|
Non-capital Kemper IGCC-related costs incurred during construction were initially deferred as regulatory assets. Some of these costs are now included in rates and are being recognized through income; however, such costs continue to be included in the Current Cost Estimate and the Actual Costs at December 31, 2016. The wholesale portion of debt carrying costs, whether deferred or recognized through income, is not included in the Current Cost Estimate and the Actual Costs at December 31, 2016. See "Rate Recovery of Kemper IGCC Costs – Regulatory Assets and Liabilities" herein for additional information.
|
(f)
|
The Current Cost Estimate and the Actual Costs include $2.76 billion that will not be recovered for costs above the cost cap, $0.83 billion of investment costs included in current rates for the combined cycle and related assets in service, and $0.08 billion of costs that were previously expensed for the combined cycle and related assets in service. The Current Cost Estimate and the Actual Costs exclude $0.25 billion of costs not included in current rates for post-June 2013 mine operations, the lignite fuel inventory, and the nitrogen plant capital lease, which will be included in the 2017 Rate Case to be filed by June 3, 2017. See Note 1 to the financial statements under "Fuel Inventory," Note 6 to the financial statements under "Capital Leases," and "Rate Recovery of Kemper IGCC Costs – 2017 Rate Case" herein for additional information.
|
Cost Category
|
Actual Costs
|
||
|
(in billions)
|
||
Gasifiers and Gas Clean-up Facilities
|
$
|
1.88
|
|
Lignite Mine Facility
|
0.31
|
|
|
CO
2
Pipeline Facilities
|
0.11
|
|
|
Combined Cycle and Common Facilities
|
0.16
|
|
|
AFUDC
|
0.69
|
|
|
General exceptions
|
0.07
|
|
|
Plant inventory
|
0.03
|
|
|
Lignite inventory
|
0.08
|
|
|
Regulatory and other deferred assets
|
0.12
|
|
|
Subtotal
|
$
|
3.45
|
|
Additional DOE Grants
|
(0.14
|
)
|
|
Total
|
$
|
3.31
|
|
Expires
|
|
|
|
|
|
Executable
Term Loans
|
|
Expires Within One Year
|
||||||||||||||||||
2017
|
|
Total
|
|
Unused
|
|
One
Year
|
|
Two
Years
|
|
Term Out
|
|
No Term Out
|
||||||||||||||
(in millions)
|
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
||||||||||||||||||||
$
|
173
|
|
|
$
|
173
|
|
|
$
|
150
|
|
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
13
|
|
|
$
|
160
|
|
|
Short-term Debt at the End of the Period
|
|
Short-term Debt During the Period
(*)
|
||||||||||||||
|
Amount Outstanding
|
|
Weighted Average Interest Rate
|
|
Average Outstanding
|
|
Weighted Average Interest Rate
|
|
Maximum Amount Outstanding
|
||||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
|
(in millions)
|
||||||||
December 31, 2016
|
$
|
23
|
|
|
2.6
|
%
|
|
$
|
112
|
|
|
2.0
|
%
|
|
$
|
500
|
|
December 31, 2015
|
$
|
500
|
|
|
1.4
|
%
|
|
$
|
372
|
|
|
1.3
|
%
|
|
$
|
515
|
|
(*)
|
Average and maximum amounts are based upon daily balances during the twelve-month periods ended December 31.
|
|
2016
Changes
|
|
2015
Changes
|
||||
|
Fair Value
|
||||||
|
(in millions)
|
||||||
Contracts outstanding at the beginning of the period, assets (liabilities), net
|
$
|
(47
|
)
|
|
$
|
(45
|
)
|
Contracts realized or settled
|
29
|
|
|
33
|
|
||
Current period changes
(*)
|
11
|
|
|
(35
|
)
|
||
Contracts outstanding at the end of the period, assets (liabilities), net
|
$
|
(7
|
)
|
|
$
|
(47
|
)
|
(*)
|
Current period changes also include the changes in fair value of new contracts entered into during the period, if any.
|
|
2016
|
|
2015
|
||
|
mmBtu Volume
|
||||
|
(in millions)
|
||||
Total hedge volume
|
36
|
|
|
32
|
|
|
Fair Value Measurements
December 31, 2016
|
||||||||||
|
Total
|
|
Maturity
|
||||||||
|
Fair Value
|
|
Year 1
|
|
Years 2&3
|
||||||
|
(in millions)
|
||||||||||
Level 1
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Level 2
|
(7
|
)
|
|
(4
|
)
|
|
(3
|
)
|
|||
Level 3
|
—
|
|
|
—
|
|
|
—
|
|
|||
Fair value of contracts outstanding at end of period
|
$
|
(7
|
)
|
|
$
|
(4
|
)
|
|
$
|
(3
|
)
|
|
2017
|
|
2018-2019
|
|
2020-2021
|
|
After
2021
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Long-term debt
(a)
—
|
|
|
|
|
|
|
|
|
|
||||||||||
Principal
|
$
|
626
|
|
|
$
|
1,325
|
|
|
$
|
270
|
|
|
$
|
723
|
|
|
$
|
2,944
|
|
Interest
|
98
|
|
|
141
|
|
|
100
|
|
|
598
|
|
|
937
|
|
|||||
Preferred stock dividends
(b)
|
2
|
|
|
3
|
|
|
3
|
|
|
—
|
|
|
8
|
|
|||||
Financial derivative obligations
(c)
|
6
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|||||
Unrecognized tax benefits
(d)
|
465
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
465
|
|
|||||
Operating leases
(e)
|
2
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
4
|
|
|||||
Capital leases
(f)
|
7
|
|
|
13
|
|
|
13
|
|
|
76
|
|
|
109
|
|
|||||
Purchase commitments —
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital
(g)
|
480
|
|
|
508
|
|
|
506
|
|
|
—
|
|
|
1,494
|
|
|||||
Fuel
(h)
|
290
|
|
|
320
|
|
|
184
|
|
|
251
|
|
|
1,045
|
|
|||||
Long-term service agreements
(i)
|
15
|
|
|
75
|
|
|
48
|
|
|
244
|
|
|
382
|
|
|||||
Pension and other postretirement benefits plans
(j)
|
7
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|||||
Total
|
$
|
1,998
|
|
|
$
|
2,405
|
|
|
$
|
1,125
|
|
|
$
|
1,892
|
|
|
$
|
7,420
|
|
(a)
|
All amounts are reflected based on final maturity dates except for amounts related to certain pollution control revenue bonds.
Long-term debt principal for 2017 includes $40 million of pollution control revenue bonds that are classified on the balance sheet at December 31, 2016 as short-term since they are variable rate demand obligations that are supported by short-term credit facilities; however, the final maturity date is in 2028.
The Company plans to continue, when economically feasible, to retire higher-cost sec
urities and replace these obligations with lower-cost capital if market conditions permit. Variable rate interest obligations are estimated based on rates as of January 1, 2017, as reflected in the statements of capitalization. Fixed rates include, where applicable, the effects of interest rate derivatives employed to manage interest rate risk. Long-term debt excludes capital lease amounts (shown separately).
|
(b)
|
Preferred stock does not mature; therefore, amounts are provided for the next five years only.
|
(c)
|
For additional information, see Notes 1 and 10 to the financial statements.
|
(d)
|
See Note 5 to the financial statements under "Unrecognized Tax Benefits" for additional information.
|
(e)
|
See Note 7 to the financial statements for additional information.
|
(f)
|
Capital lease related to a 20-year nitrogen supply agreement for the Kemper IGCC. See Note 6 to the financial statements for additional information.
|
(g)
|
The Company provides estimated capital expenditures for a five-year period, including capital expenditures associated with environmental regulations. At December 31, 2016, significant purchase commitments were outstanding in connection with the construction program. These amounts exclude capital expenditures covered under long-term service agreements, which are reflected separately. See FUTURE EARNINGS POTENTIAL – "Environmental Matters – Environmental Statutes and Regulations" herein for additional information. See Note 3 to the financial statements under "Integrated Coal Gasification Combined Cycle" for additional information.
|
(h)
|
Includes commitments to purchase coal and natural gas, as well as the related transportation and storage. In most cases, these contracts contain provisions for price escalation, minimum purchase levels, and other financial commitments. Natural gas purchase commitments are based on various indices at the
time of delivery. Amounts reflected for natural gas purchase commitments have been estimated based on the New York Mercantile Exchange future prices at December 31, 2016.
|
(i)
|
Long-term service agreements include price escalation based on inflation indices.
|
(j)
|
The Company forecasts contributions to the pension and other postretirement benefit plans over a three-year period. The Company anticipates no mandatory contributions to the qualified pension plan during the next three years. Amounts presented represent estimated benefit payments for the nonqualified pension plans, estimated non-trust benefit payments for the other postretirement benefit plans, and estimated contributions to the other postretirement benefit plan trusts, all of which will be made from the Company's corporate assets. See Note 2 to the financial statements for additional information related to the pension and other postretirement benefit plans, including estimated benefit payments. Certain benefit payments will be made through the related benefit plans. Other benefit payments will be made from the Company's corporate assets.
|
•
|
the impact of recent and future federal and state regulatory changes, including environmental laws regulating emissions, discharges, and disposal to air, water, and land
,
and also changes in tax and other laws and regulations to which
the Company is
subject, including potential tax reform legislation, as well as changes in application of existing laws and regulations;
|
•
|
current and future litigation, regulatory investigations, proceedings, or inquiries
;
|
•
|
the effects, extent, and timing of the entry of additional competition in the markets in which
the Company operates;
|
•
|
variations in demand for
electricity,
including those relating to weather, the general economy and recovery from the last recession, population and business growth (and declines), the effects of energy conservation and efficiency measures, including from the development and deployment of alternative energy sources such as self-generation and distributed generation technologies, and any potential economic impacts resulting from federal fiscal decisions;
|
•
|
available sources and costs of
fuels;
|
•
|
effects of inflation;
|
•
|
the ability to control costs and avoid cost overruns during the development
, construction, and operation of
facilities, which include the development and construction of
generating facilities
with designs that have not been finalized or previously constructed, including changes in labor costs and productivity, adverse weather conditions, shortages and inconsistent quality of equipment, materials, and labor
,
sustaining nitrogen supply,
contractor or supplier delay, non-performance under
operating
or other agreements, operational readiness, including specialized operator training and required site safety programs, unforeseen engineering or design problems, start-up activities (including major equipment failure and system integration), and/or operational performance (including additional costs to satisfy any operational parameters ultimately adopted by
the Mississippi PSC);
|
•
|
the ability
to construct facilities in accordance with the requirements of permits and licenses,
to satisfy any environmental performance standards
and
the requirements of tax credits and other incentives
,
and to integrate facilities into the Southern Company system upon completion of construction;
|
•
|
investment performance of
the Company's
employee and retiree benefit plans
;
|
•
|
advances in technology;
|
•
|
state and federal rate regulations
and the impact of pending and future rate cases and negotiations, including rate
actions relating
to fuel and other cost recovery mechanisms;
|
•
|
the ability to successfully operate generating, transmission, and distribution facilities and the successful performance of necessary corporate functions;
|
•
|
actions related to cost recovery for the Kemper IGCC, including the ultimate impact of the 2015 decision of the Mississippi Supreme Court, the Mississippi PSC's December 2015 rate order, and related legal or regulatory proceedings, Mississippi PSC review of the prudence of Kemper IGCC costs and approval of further permanent rate recovery plans, actions relating to proposed securitization,
satisfaction of requirements to utilize grants, and the ultimate impact of the termination of the proposed sale of an interest in the Kemper IGCC to SMEPA;
|
•
|
internal restructuring or other restructuring options that may be pursued;
|
•
|
potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to
the Company;
|
•
|
the ability of counterparties of
the Company
to make payments as and when due and to perform as required;
|
•
|
the ability to obtain new short- and long-term contracts with wholesale customers;
|
•
|
the direct or indirect effect on the
Company's
business resulting from cyber intrusion or terrorist incidents and the threat of terrorist incidents;
|
•
|
interest rate fluctuations and financial market conditions and the results of financing efforts;
|
•
|
changes in the Company's
credit ratings, including impacts on interest rates, access to capital markets, and collateral requirements;
|
•
|
the impacts of any sovereign financial issues, including impacts on interest rates, access to capital markets, impacts on foreign currency exchange rates, counterparty performance, and the economy in general
;
|
•
|
the ability of
the Company
to obtain additional generating capacity (or sell excess generating capacity) at competitive prices;
|
•
|
catastrophic events such as fires, earthquakes, explosions, floods, tornadoes,
hurricanes and other storms, droughts, pandemic health events such as influenzas, or other similar occurrences;
|
•
|
the direct or indirect effects on the
Company's
business resulting from incidents affecting the U.S. electric grid
or operation of generating
resources;
|
•
|
the effect of accounting pronouncements issued periodically by standard-setting bodies; and
|
•
|
other factors discussed elsewhere herein and in other reports (including the Form 10-K) filed by
the Company
from time to time with the SEC.
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
||||||
Retail revenues
|
$
|
859
|
|
|
$
|
776
|
|
|
$
|
795
|
|
Wholesale revenues, non-affiliates
|
261
|
|
|
270
|
|
|
323
|
|
|||
Wholesale revenues, affiliates
|
26
|
|
|
76
|
|
|
107
|
|
|||
Other revenues
|
17
|
|
|
16
|
|
|
18
|
|
|||
Total operating revenues
|
1,163
|
|
|
1,138
|
|
|
1,243
|
|
|||
Operating Expenses:
|
|
|
|
|
|
||||||
Fuel
|
343
|
|
|
443
|
|
|
574
|
|
|||
Purchased power, non-affiliates
|
5
|
|
|
5
|
|
|
18
|
|
|||
Purchased power, affiliates
|
29
|
|
|
7
|
|
|
25
|
|
|||
Other operations and maintenance
|
312
|
|
|
274
|
|
|
271
|
|
|||
Depreciation and amortization
|
132
|
|
|
123
|
|
|
97
|
|
|||
Taxes other than income taxes
|
109
|
|
|
94
|
|
|
79
|
|
|||
Estimated loss on Kemper IGCC
|
428
|
|
|
365
|
|
|
868
|
|
|||
Total operating expenses
|
1,358
|
|
|
1,311
|
|
|
1,932
|
|
|||
Operating Loss
|
(195
|
)
|
|
(173
|
)
|
|
(689
|
)
|
|||
Other Income and (Expense):
|
|
|
|
|
|
||||||
Allowance for equity funds used during construction
|
124
|
|
|
110
|
|
|
136
|
|
|||
Interest expense, net of amounts capitalized
|
(74
|
)
|
|
(7
|
)
|
|
(45
|
)
|
|||
Other income (expense), net
|
(7
|
)
|
|
(8
|
)
|
|
(14
|
)
|
|||
Total other income and (expense)
|
43
|
|
|
95
|
|
|
77
|
|
|||
Loss Before Income Taxes
|
(152
|
)
|
|
(78
|
)
|
|
(612
|
)
|
|||
Income taxes (benefit)
|
(104
|
)
|
|
(72
|
)
|
|
(285
|
)
|
|||
Net Loss
|
(48
|
)
|
|
(6
|
)
|
|
(327
|
)
|
|||
Dividends on Preferred Stock
|
2
|
|
|
2
|
|
|
2
|
|
|||
Net Loss After Dividends on Preferred Stock
|
$
|
(50
|
)
|
|
$
|
(8
|
)
|
|
$
|
(329
|
)
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Net Loss
|
$
|
(48
|
)
|
|
$
|
(6
|
)
|
|
$
|
(327
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Qualifying hedges:
|
|
|
|
|
|
||||||
Changes in fair value, net of tax of $1, $-, and $-,
respectively |
1
|
|
|
—
|
|
|
—
|
|
|||
Reclassification adjustment for amounts included in net income,
net of tax of $1, $1, and $1, respectively |
1
|
|
|
1
|
|
|
1
|
|
|||
Total other comprehensive income (loss)
|
2
|
|
|
1
|
|
|
1
|
|
|||
Comprehensive Loss
|
$
|
(46
|
)
|
|
$
|
(5
|
)
|
|
$
|
(326
|
)
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Operating Activities:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(48
|
)
|
|
$
|
(6
|
)
|
|
$
|
(327
|
)
|
Adjustments to reconcile net loss to net cash provided from operating activities —
|
|
|
|
|
|
||||||
Depreciation and amortization, total
|
157
|
|
|
126
|
|
|
104
|
|
|||
Deferred income taxes
|
(67
|
)
|
|
777
|
|
|
145
|
|
|||
Investment tax credits
|
—
|
|
|
(210
|
)
|
|
(38
|
)
|
|||
Allowance for equity funds used during construction
|
(124
|
)
|
|
(110
|
)
|
|
(136
|
)
|
|||
Pension and postretirement funding
|
(47
|
)
|
|
—
|
|
|
(33
|
)
|
|||
Regulatory assets associated with Kemper IGCC
|
(12
|
)
|
|
(61
|
)
|
|
(72
|
)
|
|||
Estimated loss on Kemper IGCC
|
428
|
|
|
365
|
|
|
868
|
|
|||
Income taxes receivable, non-current
|
—
|
|
|
(544
|
)
|
|
—
|
|
|||
Other, net
|
(20
|
)
|
|
8
|
|
|
22
|
|
|||
Changes in certain current assets and liabilities —
|
|
|
|
|
|
||||||
-Receivables
|
13
|
|
|
28
|
|
|
(22
|
)
|
|||
-Prepaid income taxes
|
39
|
|
|
(35
|
)
|
|
(50
|
)
|
|||
-Other current assets
|
(8
|
)
|
|
(18
|
)
|
|
(6
|
)
|
|||
-Accounts payable
|
(14
|
)
|
|
(34
|
)
|
|
33
|
|
|||
-Accrued taxes
|
14
|
|
|
(11
|
)
|
|
39
|
|
|||
-Over recovered regulatory clause revenues
|
(45
|
)
|
|
96
|
|
|
(18
|
)
|
|||
-Mirror CWIP
|
—
|
|
|
(271
|
)
|
|
180
|
|
|||
-Customer liability associated with Kemper refunds
|
(73
|
)
|
|
73
|
|
|
—
|
|
|||
-Other current liabilities
|
36
|
|
|
—
|
|
|
46
|
|
|||
Net cash provided from operating activities
|
229
|
|
|
173
|
|
|
735
|
|
|||
Investing Activities:
|
|
|
|
|
|
||||||
Property additions
|
(798
|
)
|
|
(857
|
)
|
|
(1,257
|
)
|
|||
Investment in restricted cash
|
—
|
|
|
—
|
|
|
(11
|
)
|
|||
Distribution of restricted cash
|
—
|
|
|
—
|
|
|
11
|
|
|||
Construction payables
|
(26
|
)
|
|
(9
|
)
|
|
(50
|
)
|
|||
Government grant proceeds
|
137
|
|
|
—
|
|
|
—
|
|
|||
Other investing activities
|
(10
|
)
|
|
(40
|
)
|
|
(33
|
)
|
|||
Net cash used for investing activities
|
(697
|
)
|
|
(906
|
)
|
|
(1,340
|
)
|
|||
Financing Activities:
|
|
|
|
|
|
||||||
Proceeds —
|
|
|
|
|
|
||||||
Capital contributions from parent company
|
627
|
|
|
277
|
|
|
451
|
|
|||
Bonds — Other
|
—
|
|
|
—
|
|
|
23
|
|
|||
Interest-bearing refundable deposit
|
—
|
|
|
—
|
|
|
125
|
|
|||
Long-term debt issuance to parent company
|
200
|
|
|
275
|
|
|
220
|
|
|||
Other long-term debt
|
1,200
|
|
|
—
|
|
|
250
|
|
|||
Short-term borrowings
|
—
|
|
|
505
|
|
|
—
|
|
|||
Redemptions —
|
|
|
|
|
|
||||||
Short-term borrowings
|
(478
|
)
|
|
(5
|
)
|
|
—
|
|
|||
Long-term debt to parent company
|
(225
|
)
|
|
—
|
|
|
(220
|
)
|
|||
Bonds — Other
|
—
|
|
|
—
|
|
|
(34
|
)
|
|||
Senior notes
|
(300
|
)
|
|
—
|
|
|
—
|
|
|||
Other long-term debt
|
(425
|
)
|
|
(350
|
)
|
|
—
|
|
|||
Return of capital
|
—
|
|
|
—
|
|
|
(220
|
)
|
|||
Other financing activities
|
(5
|
)
|
|
(4
|
)
|
|
(2
|
)
|
|||
Net cash provided from financing activities
|
594
|
|
|
698
|
|
|
593
|
|
|||
Net Change in Cash and Cash Equivalents
|
126
|
|
|
(35
|
)
|
|
(12
|
)
|
|||
Cash and Cash Equivalents at Beginning of Year
|
98
|
|
|
133
|
|
|
145
|
|
|||
Cash and Cash Equivalents at End of Year
|
$
|
224
|
|
|
$
|
98
|
|
|
$
|
133
|
|
Supplemental Cash Flow Information:
|
|
|
|
|
|
||||||
Cash paid (received) during the period for —
|
|
|
|
|
|
||||||
Interest (net of $49, $66, and $69 capitalized, respectively)
|
$
|
50
|
|
|
$
|
45
|
|
|
$
|
7
|
|
Income taxes (net of refunds)
|
(97
|
)
|
|
(33
|
)
|
|
(379
|
)
|
|||
Noncash transactions —
|
|
|
|
|
|
||||||
Accrued property additions at year-end
|
78
|
|
|
105
|
|
|
114
|
|
|||
Issuance of promissory note to parent related to repayment of
interest-bearing refundable deposits and accrued interest
|
—
|
|
|
301
|
|
|
—
|
|
Assets
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
224
|
|
|
$
|
98
|
|
Receivables —
|
|
|
|
||||
Customer accounts receivable
|
29
|
|
|
26
|
|
||
Unbilled revenues
|
42
|
|
|
36
|
|
||
Income taxes receivable, current
|
544
|
|
|
20
|
|
||
Other accounts and notes receivable
|
14
|
|
|
10
|
|
||
Affiliated
|
15
|
|
|
20
|
|
||
Fossil fuel stock
|
100
|
|
|
104
|
|
||
Materials and supplies, current
|
76
|
|
|
75
|
|
||
Other regulatory assets, current
|
115
|
|
|
95
|
|
||
Prepaid income taxes
|
—
|
|
|
39
|
|
||
Other current assets
|
8
|
|
|
8
|
|
||
Total current assets
|
1,167
|
|
|
531
|
|
||
Property, Plant, and Equipment:
|
|
|
|
||||
In service
|
4,865
|
|
|
4,886
|
|
||
Less accumulated provision for depreciation
|
1,289
|
|
|
1,262
|
|
||
Plant in service, net of depreciation
|
3,576
|
|
|
3,624
|
|
||
Construction work in progress
|
2,545
|
|
|
2,254
|
|
||
Total property, plant, and equipment
|
6,121
|
|
|
5,878
|
|
||
Other Property and Investments
|
12
|
|
|
11
|
|
||
Deferred Charges and Other Assets:
|
|
|
|
||||
Deferred charges related to income taxes
|
361
|
|
|
290
|
|
||
Other regulatory assets, deferred
|
518
|
|
|
525
|
|
||
Income taxes receivable, non-current
|
—
|
|
|
544
|
|
||
Other deferred charges and assets
|
56
|
|
|
61
|
|
||
Total deferred charges and other assets
|
935
|
|
|
1,420
|
|
||
Total Assets
|
$
|
8,235
|
|
|
$
|
7,840
|
|
Liabilities and Stockholder's Equity
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
||||
Securities due within one year —
|
|
|
|
||||
Parent
|
$
|
551
|
|
|
$
|
—
|
|
Other
|
78
|
|
|
728
|
|
||
Notes payable
|
23
|
|
|
500
|
|
||
Accounts payable —
|
|
|
|
||||
Affiliated
|
62
|
|
|
85
|
|
||
Other
|
135
|
|
|
135
|
|
||
Customer deposits
|
16
|
|
|
16
|
|
||
Accrued taxes
|
99
|
|
|
85
|
|
||
Unrecognized tax benefits, current
|
383
|
|
|
—
|
|
||
Accrued interest
|
46
|
|
|
18
|
|
||
Accrued compensation
|
42
|
|
|
37
|
|
||
Asset retirement obligations, current
|
32
|
|
|
22
|
|
||
Over recovered regulatory clause liabilities
|
51
|
|
|
96
|
|
||
Customer liability associated with Kemper refunds
|
1
|
|
|
73
|
|
||
Other current liabilities
|
19
|
|
|
41
|
|
||
Total current liabilities
|
1,538
|
|
|
1,836
|
|
||
Long-Term Debt
(
See accompanying statements
)
|
2,424
|
|
|
1,886
|
|
||
Deferred Credits and Other Liabilities:
|
|
|
|
||||
Accumulated deferred income taxes
|
756
|
|
|
762
|
|
||
Employee benefit obligations
|
115
|
|
|
153
|
|
||
Asset retirement obligations, deferred
|
146
|
|
|
154
|
|
||
Unrecognized tax benefits, deferred
|
—
|
|
|
368
|
|
||
Other cost of removal obligations
|
170
|
|
|
165
|
|
||
Other regulatory liabilities, deferred
|
84
|
|
|
79
|
|
||
Other deferred credits and liabilities
|
26
|
|
|
45
|
|
||
Total deferred credits and other liabilities
|
1,297
|
|
|
1,726
|
|
||
Total Liabilities
|
5,259
|
|
|
5,448
|
|
||
Cumulative Redeemable Preferred Stock
(
See accompanying statements
)
|
33
|
|
|
33
|
|
||
Common Stockholder's Equity
(
See accompanying statements
)
|
2,943
|
|
|
2,359
|
|
||
Total Liabilities and Stockholder's Equity
|
$
|
8,235
|
|
|
$
|
7,840
|
|
Commitments and Contingent Matters
(
See notes
)
|
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||
|
(in millions)
|
|
(percent of total)
|
||||||||||
Long-Term Debt:
|
|
|
|
|
|
|
|
||||||
Long-term notes payable —
|
|
|
|
|
|
|
|
||||||
2.35% due 2016
|
$
|
—
|
|
|
$
|
300
|
|
|
|
|
|
||
5.60% due 2017
|
35
|
|
|
35
|
|
|
|
|
|
||||
5.55% due 2019
|
125
|
|
|
125
|
|
|
|
|
|
||||
1.63% to 5.40% due 2035-2042
|
680
|
|
|
680
|
|
|
|
|
|
||||
Adjustable rates (1.84% to 1.90% at 1/1/16) due 2016
|
—
|
|
|
425
|
|
|
|
|
|
||||
Adjustable rates (2.15% to 2.24% at 1/1/17) due 2018
|
1,200
|
|
|
—
|
|
|
|
|
|
||||
Total long-term notes payable
|
2,040
|
|
|
1,565
|
|
|
|
|
|
||||
Other long-term debt —
|
|
|
|
|
|
|
|
||||||
Pollution control revenue bonds —
|
|
|
|
|
|
|
|
||||||
5.15% due 2028
|
43
|
|
|
43
|
|
|
|
|
|
||||
Variable rates (0.83% to 0.87% at 1/1/17) due 2017
|
40
|
|
|
40
|
|
|
|
|
|
||||
Plant Daniel revenue bonds (7.13%) due 2021
|
270
|
|
|
270
|
|
|
|
|
|
||||
Long-term debt payable to parent company (2.27%) due 2017
|
551
|
|
|
576
|
|
|
|
|
|
||||
Total other long-term debt
|
904
|
|
|
929
|
|
|
|
|
|
||||
Capitalized lease obligations
|
74
|
|
|
77
|
|
|
|
|
|
||||
Unamortized debt premium
|
45
|
|
|
53
|
|
|
|
|
|
||||
Unamortized debt discount
|
(2
|
)
|
|
(2
|
)
|
|
|
|
|
||||
Unamortized debt issuance expense
|
(8
|
)
|
|
(8
|
)
|
|
|
|
|
||||
Total long-term debt (annual interest requirement — $102 million)
|
3,053
|
|
|
2,614
|
|
|
|
|
|
||||
Less amount due within one year
|
629
|
|
|
728
|
|
|
|
|
|
||||
Long-term debt excluding amount due within one year
|
2,424
|
|
|
1,886
|
|
|
44.9
|
%
|
|
44.1
|
%
|
||
Cumulative Redeemable Preferred Stock:
|
|
|
|
|
|
|
|
||||||
$100 par value —
|
|
|
|
|
|
|
|
||||||
Authorized — 1,244,139 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — 334,210 shares
|
|
|
|
|
|
|
|
||||||
4.40% to 5.25% (annual dividend requirement — $2 million)
|
33
|
|
|
33
|
|
|
0.6
|
|
|
0.8
|
|
||
Common Stockholder's Equity:
|
|
|
|
|
|
|
|
||||||
Common stock, without par value —
|
|
|
|
|
|
|
|
||||||
Authorized — 1,130,000 shares
|
|
|
|
|
|
|
|
||||||
Outstanding — 1,121,000 shares
|
38
|
|
|
38
|
|
|
|
|
|
||||
Paid-in capital
|
3,525
|
|
|
2,893
|
|
|
|
|
|
||||
Accumulated deficit
|
(616
|
)
|
|
(566
|
)
|
|
|
|
|
||||
Accumulated other comprehensive loss
|
(4
|
)
|
|
(6
|
)
|
|
|
|
|
||||
Total common stockholder's equity
|
2,943
|
|
|
2,359
|
|
|
54.5
|
|
|
55.1
|
|
||
Total Capitalization
|
$
|
5,400
|
|
|
$
|
4,278
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
Number of Common Shares Issued
|
|
Common
Stock
|
|
Paid-In Capital
|
|
Retained Earnings (Accumulated Deficit)
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total
|
|||||||||||
|
(in millions)
|
|||||||||||||||||||||
Balance at December 31, 2013
|
1
|
|
|
$
|
38
|
|
|
$
|
2,377
|
|
|
$
|
(230
|
)
|
|
$
|
(8
|
)
|
|
$
|
2,177
|
|
Net loss after dividends on preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(329
|
)
|
|
—
|
|
|
(329
|
)
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
235
|
|
|
—
|
|
|
—
|
|
|
235
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||
Balance at December 31, 2014
|
1
|
|
|
38
|
|
|
2,612
|
|
|
(559
|
)
|
|
(7
|
)
|
|
2,084
|
|
|||||
Net loss after dividends on preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
281
|
|
|
—
|
|
|
—
|
|
|
281
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||
Balance at December 31, 2015
|
1
|
|
|
38
|
|
|
2,893
|
|
|
(566
|
)
|
|
(6
|
)
|
|
2,359
|
|
|||||
Net loss after dividends on preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(50
|
)
|
|
—
|
|
|
(50
|
)
|
|||||
Capital contributions from parent company
|
—
|
|
|
—
|
|
|
632
|
|
|
—
|
|
|
—
|
|
|
632
|
|
|||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||
Balance at December 31, 2016
|
1
|
|
|
$
|
38
|
|
|
$
|
3,525
|
|
|
$
|
(616
|
)
|
|
$
|
(4
|
)
|
|
$
|
2,943
|
|
Note
|
|
Page
|
1
|
||
2
|
||
3
|
||
4
|
||
5
|
||
6
|
||
7
|
||
8
|
||
9
|
||
10
|
||
11
|
|
2016
|
|
|
2015
|
|
|
Note
|
||
|
(in millions)
|
||||||||
Kemper IGCC
|
$
|
201
|
|
|
$
|
216
|
|
|
(h)
|
Retiree benefit plans – regulatory assets
|
173
|
|
|
163
|
|
|
(a,g)
|
||
Asset retirement obligations
|
83
|
|
|
70
|
|
|
(c)
|
||
Deferred income tax charges
|
362
|
|
|
291
|
|
|
(c)
|
||
Remaining net book value of retired assets
|
53
|
|
|
36
|
|
|
(b)
|
||
Property tax
|
37
|
|
|
27
|
|
|
(d)
|
||
Plant Daniel Units 3 and 4
|
33
|
|
|
29
|
|
|
(j)
|
||
Other regulatory assets
|
42
|
|
|
27
|
|
|
(e,g)
|
||
Fuel-hedging (realized and unrealized) losses
|
7
|
|
|
50
|
|
|
(f,g)
|
||
Property damage
|
(68
|
)
|
|
(64
|
)
|
|
(i)
|
||
Other cost of removal obligations
|
(170
|
)
|
|
(167
|
)
|
|
(c)
|
||
Other regulatory liabilities
|
(16
|
)
|
|
(11
|
)
|
|
(b)
|
||
Total regulatory assets (liabilities), net
|
$
|
737
|
|
|
$
|
667
|
|
|
|
(a)
|
Recovered and amortized over the average remaining service period which m
ay range up to
14 years
. See Note 2 for additional information.
|
(b)
|
Other regulatory liabilities is comprised of numerous immaterial components including deferred income tax credits and other miscellaneous liabilities that are recorded and refunded or amortized as approved by the Mississippi PSC generally over periods not exceeding
one year
.
|
(c)
|
Asset retirement and other cost of removal obligations and deferred income tax assets are recovered, and deferred income tax liabilities are amortized over the related property lives, which may range up to
49 years
. Asset retirement and removal assets and liabilities will be settled and trued up following completion of the related activities.
|
(d)
|
The retail portion of property taxes is recovered through the ad valorem tax adjustment clause over a
12
-month period beginning in April of the following year. See Note 3 under "Retail Regulatory Matters – Ad Valorem Tax Adjustment" for additional information.
|
(e)
|
Other regulatory assets is comprised of numerous immaterial components including vacation pay, loss on reacquired debt, and other miscellaneous assets. These costs are recorded and recovered or amortized as approved by the Mississippi PSC over periods which may range up to
50
years.
|
(f)
|
Fuel-hedging assets and liabilities are recorded over the life of the underlying hedged purchase contracts, which generally do not exceed
three years
. Upon final settlement, actual costs incurred are recovered through the ECM.
|
(g)
|
Not earning a return as offset in rate base by a corresponding asset or liability.
|
(h)
|
Includes
$97 million
of regulatory assets currently in rates to be recovered over periods of
two
,
seven
, or
10 years
. For additional information, see Note 3 under "Integrated Coal Gasification Combined Cycle – Rate Recovery of Kemper IGCC Costs – Regulatory Assets and Liabilities."
|
(i)
|
For additional information, see Note 1 under "Provision for Property Damage."
|
(j)
|
The difference between the revenue requirement under the purchase option and the revenue requirement assuming operating lease accounting treatment for the extended term is d
eferred and amortized over
a
10
-year period beginning October 2021.
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Generation
|
$
|
2,632
|
|
|
$
|
2,723
|
|
Transmission
|
712
|
|
|
688
|
|
||
Distribution
|
916
|
|
|
891
|
|
||
General
|
520
|
|
|
503
|
|
||
Plant acquisition adjustment
|
85
|
|
|
81
|
|
||
Total plant in service
|
$
|
4,865
|
|
|
$
|
4,886
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Balance at beginning of year
|
$
|
177
|
|
|
$
|
48
|
|
Liabilities incurred
|
15
|
|
|
101
|
|
||
Liabilities settled
|
(23
|
)
|
|
(3
|
)
|
||
Accretion
|
5
|
|
|
4
|
|
||
Cash flow revisions
|
5
|
|
|
27
|
|
||
Balance at end of year
|
$
|
179
|
|
|
$
|
177
|
|
Assumptions used to determine net periodic costs:
|
2016
|
|
2015
|
|
2014
|
|||
Pension plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.69
|
%
|
|
4.17
|
%
|
|
5.01
|
%
|
Discount rate – interest costs
|
3.97
|
|
|
4.17
|
|
|
5.01
|
|
Discount rate – service costs
|
5.04
|
|
|
4.49
|
|
|
5.01
|
|
Expected long-term return on plan assets
|
8.20
|
|
|
8.20
|
|
|
8.20
|
|
Annual salary increase
|
4.46
|
|
|
3.59
|
|
|
3.59
|
|
Other postretirement benefit plans
|
|
|
|
|
|
|||
Discount rate – benefit obligations
|
4.47
|
%
|
|
4.03
|
%
|
|
4.85
|
%
|
Discount rate – interest costs
|
3.66
|
|
|
4.03
|
|
|
4.85
|
|
Discount rate – service costs
|
4.88
|
|
|
4.38
|
|
|
4.85
|
|
Expected long-term return on plan assets
|
7.07
|
|
|
7.23
|
|
|
7.30
|
|
Annual salary increase
|
4.46
|
|
|
3.59
|
|
|
3.59
|
|
Assumptions used to determine benefit obligations:
|
2016
|
|
2015
|
||
Pension plans
|
|
|
|
||
Discount rate
|
4.44
|
%
|
|
4.69
|
%
|
Annual salary increase
|
4.46
|
|
|
4.46
|
|
Other postretirement benefit plans
|
|
|
|
||
Discount rate
|
4.22
|
%
|
|
4.47
|
%
|
Annual salary increase
|
4.46
|
|
|
4.46
|
|
|
Initial Cost Trend Rate
|
|
Ultimate Cost Trend Rate
|
|
Year That Ultimate Rate is Reached
|
||
Pre-65
|
6.50
|
%
|
|
4.50
|
%
|
|
2025
|
Post-65 medical
|
5.00
|
|
|
4.50
|
|
|
2025
|
Post-65 prescription
|
10.00
|
|
|
4.50
|
|
|
2025
|
|
1 Percent
Increase
|
|
1 Percent
Decrease
|
||||
|
(in millions)
|
||||||
Benefit obligation
|
$
|
5
|
|
|
$
|
4
|
|
Service and interest costs
|
—
|
|
|
—
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
500
|
|
|
$
|
513
|
|
Service cost
|
13
|
|
|
13
|
|
||
Interest cost
|
19
|
|
|
21
|
|
||
Benefits paid
|
(20
|
)
|
|
(22
|
)
|
||
Actuarial (gain) loss
|
22
|
|
|
(25
|
)
|
||
Balance at end of year
|
534
|
|
|
500
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
430
|
|
|
446
|
|
||
Actual return (loss) on plan assets
|
39
|
|
|
4
|
|
||
Employer contributions
|
50
|
|
|
2
|
|
||
Benefits paid
|
(20
|
)
|
|
(22
|
)
|
||
Fair value of plan assets at end of year
|
499
|
|
|
430
|
|
||
Accrued liability
|
$
|
(35
|
)
|
|
$
|
(70
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
154
|
|
|
$
|
144
|
|
Other current liabilities
|
(3
|
)
|
|
(3
|
)
|
||
Employee benefit obligations
|
(32
|
)
|
|
(67
|
)
|
|
2016
|
|
2015
|
|
Estimated Amortization in 2017
|
||||||
|
(in millions)
|
||||||||||
Prior service cost
|
$
|
3
|
|
|
$
|
2
|
|
|
$
|
1
|
|
Net (gain) loss
|
151
|
|
|
142
|
|
|
7
|
|
|||
Regulatory assets
|
$
|
154
|
|
|
$
|
144
|
|
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Regulatory assets:
|
|
|
|
||||
Beginning balance
|
$
|
144
|
|
|
$
|
151
|
|
Net (gain) loss
|
16
|
|
|
4
|
|
||
Change in prior service costs
|
2
|
|
|
—
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
(1
|
)
|
|
(1
|
)
|
||
Amortization of net gain (loss)
|
(7
|
)
|
|
(10
|
)
|
||
Total reclassification adjustments
|
(8
|
)
|
|
(11
|
)
|
||
Total change
|
10
|
|
|
(7
|
)
|
||
Ending balance
|
$
|
154
|
|
|
$
|
144
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
13
|
|
|
$
|
13
|
|
|
$
|
10
|
|
Interest cost
|
19
|
|
|
21
|
|
|
20
|
|
|||
Expected return on plan assets
|
(35
|
)
|
|
(33
|
)
|
|
(29
|
)
|
|||
Recognized net (gain) loss
|
7
|
|
|
10
|
|
|
5
|
|
|||
Net amortization
|
1
|
|
|
1
|
|
|
1
|
|
|||
Net periodic pension cost
|
$
|
5
|
|
|
$
|
12
|
|
|
$
|
7
|
|
|
Benefit
Payments
|
||
|
(in millions)
|
||
2017
|
$
|
22
|
|
2018
|
23
|
|
|
2019
|
24
|
|
|
2020
|
26
|
|
|
2021
|
27
|
|
|
2022 to 2026
|
154
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Change in benefit obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
97
|
|
|
$
|
96
|
|
Service cost
|
1
|
|
|
1
|
|
||
Interest cost
|
3
|
|
|
4
|
|
||
Benefits paid
|
(6
|
)
|
|
(5
|
)
|
||
Actuarial (gain) loss
|
1
|
|
|
(1
|
)
|
||
Plan amendment
|
—
|
|
|
1
|
|
||
Retiree drug subsidy
|
1
|
|
|
1
|
|
||
Balance at end of year
|
97
|
|
|
97
|
|
||
Change in plan assets
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
23
|
|
|
24
|
|
||
Actual return (loss) on plan assets
|
1
|
|
|
—
|
|
||
Employer contributions
|
4
|
|
|
3
|
|
||
Benefits paid
|
(5
|
)
|
|
(4
|
)
|
||
Fair value of plan assets at end of year
|
23
|
|
|
23
|
|
||
Accrued liability
|
$
|
(74
|
)
|
|
$
|
(74
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Other regulatory assets, deferred
|
$
|
21
|
|
|
$
|
21
|
|
Other regulatory liabilities, deferred
|
(2
|
)
|
|
(3
|
)
|
||
Employee benefit obligations
|
(74
|
)
|
|
(74
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Net regulatory assets (liabilities):
|
|
|
|
||||
Beginning balance
|
$
|
18
|
|
|
$
|
16
|
|
Net (gain) loss
|
2
|
|
|
—
|
|
||
Change in prior service costs
|
—
|
|
|
3
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of net gain (loss)
|
(1
|
)
|
|
(1
|
)
|
||
Total reclassification adjustments
|
(1
|
)
|
|
(1
|
)
|
||
Total change
|
1
|
|
|
2
|
|
||
Ending balance
|
$
|
19
|
|
|
$
|
18
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Service cost
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
1
|
|
Interest cost
|
3
|
|
|
4
|
|
|
4
|
|
|||
Expected return on plan assets
|
(1
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|||
Net amortization
|
1
|
|
|
1
|
|
|
—
|
|
|||
Net periodic postretirement benefit cost
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
3
|
|
|
Benefit
Payments
|
|
Subsidy
Receipts
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
2017
|
$
|
6
|
|
|
$
|
(1
|
)
|
|
$
|
5
|
|
2018
|
6
|
|
|
(1
|
)
|
|
5
|
|
|||
2019
|
7
|
|
|
(1
|
)
|
|
6
|
|
|||
2020
|
7
|
|
|
(1
|
)
|
|
6
|
|
|||
2021
|
7
|
|
|
(1
|
)
|
|
6
|
|
|||
2022 to 2026
|
36
|
|
|
(1
|
)
|
|
35
|
|
|
Target
|
|
2016
|
|
2015
|
|||
Pension plan assets:
|
|
|
|
|
|
|||
Domestic equity
|
26
|
%
|
|
29
|
%
|
|
30
|
%
|
International equity
|
25
|
|
|
22
|
|
|
23
|
|
Fixed income
|
23
|
|
|
29
|
|
|
23
|
|
Special situations
|
3
|
|
|
2
|
|
|
2
|
|
Real estate investments
|
14
|
|
|
13
|
|
|
16
|
|
Private equity
|
9
|
|
|
5
|
|
|
6
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Other postretirement benefit plan assets:
|
|
|
|
|
|
|||
Domestic equity
|
21
|
%
|
|
23
|
%
|
|
24
|
%
|
International equity
|
20
|
|
|
18
|
|
|
18
|
|
Domestic fixed income
|
38
|
|
|
43
|
|
|
38
|
|
Special situations
|
3
|
|
|
2
|
|
|
2
|
|
Real estate investments
|
11
|
|
|
10
|
|
|
13
|
|
Private equity
|
7
|
|
|
4
|
|
|
5
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
•
|
Domestic equity.
A mix of large and small capitalization stocks with generally an equal distribution of value and growth attributes, managed both actively and through passive index approaches.
|
•
|
International equity.
A mix of growth stocks and value stocks with both developed and emerging market exposure, managed both actively and through passive index approaches.
|
•
|
Fixed income.
A mix of domestic and international bonds.
|
•
|
Special situations.
Investments in opportunistic strategies with the objective of diversifying and enhancing returns and exploiting short-term inefficiencies as well as investments in promising new strategies of a longer-term nature.
|
•
|
Real estate investments.
Investments in traditional private market, equity-oriented investments in real properties (indirectly through pooled funds or partnerships) and in publicly traded real estate securities.
|
•
|
Private equity.
Investments in private partnerships that invest in private or public securities typically through privately-negotiated and/or structured transactions, including leveraged buyouts, venture capital, and distressed debt.
|
•
|
Domestic and international equity.
Investments in equity securities such as common stocks, American depositary receipts, and real estate investment trusts that trade on a public exchange are classified as Level 1 investments and are valued at the closing price in the active market. Equity investments with unpublished prices (i.e. pooled funds) are valued as Level 2, when the underlying holdings used to value the investment are comprised of Level 1 or Level 2 equity securities.
|
•
|
Fixed income.
Investments in fixed income securities are generally classified as Level 2 investments and are valued based on prices reported in the market place. Additionally, the value of fixed income securities takes into consideration certain items such as broker quotes, spreads, yield curves, interest rates, and discount rates that apply to the term of a specific instrument.
|
•
|
Real estate investments, private equity, and special situations investments.
Investments in real estate, private equity, and special situations are generally classified as Net Asset Value as a Practical Expedient, since the underlying assets typically do not have publicly available observable inputs. The fund manager values the assets using various inputs and techniques depending on the nature of the underlying investments. Techniques may include purchase multiples for comparable transactions, comparable public company trading multiples, discounted cash flow analysis, prevailing market capitalization rates, recent sales of comparable investments, and independent third-party appraisals. The fair value of partnerships is determined by aggregating the value of the underlying assets less liabilities.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
95
|
|
|
$
|
44
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
139
|
|
International equity
(*)
|
58
|
|
|
51
|
|
|
—
|
|
|
—
|
|
|
109
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
28
|
|
|
—
|
|
|
—
|
|
|
28
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Corporate bonds
|
—
|
|
|
46
|
|
|
—
|
|
|
—
|
|
|
46
|
|
|||||
Pooled funds
|
—
|
|
|
25
|
|
|
—
|
|
|
—
|
|
|
25
|
|
|||||
Cash equivalents and other
|
47
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
47
|
|
|||||
Real estate investments
|
15
|
|
|
—
|
|
|
—
|
|
|
54
|
|
|
69
|
|
|||||
Special situations
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
8
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
26
|
|
|
26
|
|
|||||
Total
|
$
|
215
|
|
|
$
|
195
|
|
|
$
|
—
|
|
|
$
|
88
|
|
|
$
|
498
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
76
|
|
|
$
|
32
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
108
|
|
International equity
(*)
|
55
|
|
|
46
|
|
|
—
|
|
|
—
|
|
|
101
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
21
|
|
|
—
|
|
|
—
|
|
|
21
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|||||
Corporate bonds
|
—
|
|
|
53
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|||||
Pooled funds
|
—
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|||||
Cash equivalents and other
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|||||
Real estate investments
|
14
|
|
|
—
|
|
|
—
|
|
|
57
|
|
|
71
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|
30
|
|
|||||
Total
|
$
|
145
|
|
|
$
|
191
|
|
|
$
|
—
|
|
|
$
|
87
|
|
|
$
|
423
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
4
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6
|
|
International equity
(*)
|
2
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Corporate bonds
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Pooled funds
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Cash equivalents and other
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Real estate investments
|
1
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
3
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||
Total
|
$
|
9
|
|
|
$
|
12
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
24
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
3
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
International equity
(*)
|
2
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|||||
Mortgage- and asset-backed securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Corporate bonds
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Pooled funds
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Cash equivalents and other
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Real estate investments
|
1
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
4
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||
Total
|
$
|
7
|
|
|
$
|
12
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
23
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
Cost Category
|
2010 Project Estimate
(a)
|
|
Current Cost Estimate
(b)
|
|
Actual Costs
|
||||||
|
(in billions)
|
||||||||||
Plant Subject to Cost Cap
(c)(e)
|
$
|
2.40
|
|
|
$
|
5.64
|
|
|
$
|
5.44
|
|
Lignite Mine and Equipment
|
0.21
|
|
|
0.23
|
|
|
0.23
|
|
|||
CO
2
Pipeline Facilities
|
0.14
|
|
|
0.11
|
|
|
0.11
|
|
|||
AFUDC
(d)
|
0.17
|
|
|
0.79
|
|
|
0.75
|
|
|||
Combined Cycle and Related Assets Placed in
Service – Incremental
(e)
|
—
|
|
|
0.04
|
|
|
0.04
|
|
|||
General Exceptions
|
0.05
|
|
|
0.10
|
|
|
0.09
|
|
|||
Deferred Costs
(e)
|
—
|
|
|
0.22
|
|
|
0.21
|
|
|||
Additional DOE Grants
(f)
|
—
|
|
|
(0.14
|
)
|
|
(0.14
|
)
|
|||
Total Kemper IGCC
(g)
|
$
|
2.97
|
|
|
$
|
6.99
|
|
|
$
|
6.73
|
|
(a)
|
The 2010 Project Estimate is the certificated cost estimate adjusted to include the certificated estimate for the CO
2
pipeline facilities approved in 2011 by the Mississippi PSC, as well as the lignite mine and equipment, AFUDC, and general exceptions.
|
(b)
|
Amounts in the Current Cost Estimate include certain estimated post-in-service costs which are expected to be subject to the cost cap.
|
(c)
|
The 2012 MPSC CPCN Order approved a construction cost cap of up to
$2.88 billion
, net of the Initial DOE Grants and excluding the cost of the lignite mine and equipment, the cost of the CO2 pipeline facilities, AFUDC, and certain general exceptions, including change of law, force majeure, and beneficial capital (which exists when the Company demonstrates that the purpose and effect of the construction cost increase is to produce efficiencies that will result in a neutral or favorable effect on customers relative to the original proposal for the CPCN) (Cost Cap Exceptions).
The Current Cost Estimate and the Actual Costs include non-incremental operating and maintenance costs related to the combined cycle and associated common facilities placed in service in August 2014 that are subject to the
$2.88 billion
cost cap and exclude post-in-service costs for the lignite mine. See "Rate Recovery of Kemper IGCC Costs – 2013 MPSC Rate Order" herein for additional information.
|
(d)
|
The Company's
2010 Project Estimate included recovery of financing costs during construction rather than the accrual of AFUDC. This approach was not approved by the Mississippi PSC as described in "Rate Recovery of Kemper IGCC Costs
–
2013 MPSC Rate Order." The Current Cost Estimate also reflects the impact of a settlement agreement with the wholesale customers for cost-based rates under FERC's jurisdiction. See "FERC Matters" herein for additional information.
|
(e)
|
Non-capital Kemper IGCC-related costs incurred during construction were initially deferred as regulatory assets. Some of these costs are now included in rates and are being recognized through income; however, such costs continue to be included in the Current Cost Estimate and the Actual Costs at December 31, 2016. The wholesale portion of debt carrying costs, whether deferred or recognized through income, is not included in the Current Cost Estimate and the Actual Costs at December 31, 2016. See "Rate Recovery of Kemper IGCC Costs – Regulatory Assets and Liabilities" herein for additional information.
|
(f)
|
On April 8, 2016, the Company received approximately
$137 million
in Additional DOE Grants, which are expected to be used to reduce future rate impacts for customers.
|
(g)
|
The Current Cost Estimate and the Actual Costs include
$2.76 billion
that will not be recovered for costs above the cost cap,
$0.83 billion
of investment costs included in current rates for the combined cycle and related assets in service, and
$0.08 billion
of costs that were previously expensed for the combined cycle and related assets in service. The Current Cost Estimate and the Actual Costs exclude
$0.25 billion
of costs not included in current rates for post-June 2013 mine operations, the lignite fuel inventory, and the nitrogen plant capital lease, which will be included in the 2017 Rate Case to be filed by June 3, 2017. See Note 1 under "Fuel Inventory," Note 6 under "Capital Leases," and "Rate Recovery of Kemper IGCC Costs – 2017 Rate Case" herein for additional information.
|
Cost Category
|
Actual Costs
|
||
|
(in billions)
|
||
Gasifiers and Gas Clean-up Facilities
|
$
|
1.88
|
|
Lignite Mine Facility
|
0.31
|
|
|
CO
2
Pipeline Facilities
|
0.11
|
|
|
Combined Cycle and Common Facilities
|
0.16
|
|
|
AFUDC
|
0.69
|
|
|
General exceptions
|
0.07
|
|
|
Plant inventory
|
0.03
|
|
|
Lignite inventory
|
0.08
|
|
|
Regulatory and other deferred assets
|
0.12
|
|
|
Subtotal
|
3.45
|
|
|
Additional DOE Grants
|
(0.14
|
)
|
|
Total
|
$
|
3.31
|
|
Generating
Plant
|
Company
Ownership
|
|
Plant in Service
|
|
Accumulated
Depreciation
|
|
CWIP
|
|||||||
|
|
|
(in millions)
|
|
|
|||||||||
Greene County
|
|
|
|
|
|
|
|
|||||||
Units 1 and 2
|
40
|
%
|
|
$
|
165
|
|
|
$
|
48
|
|
|
$
|
—
|
|
Daniel
|
|
|
|
|
|
|
|
|||||||
Units 1 and 2
|
50
|
%
|
|
$
|
695
|
|
|
$
|
173
|
|
|
$
|
15
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Federal —
|
|
|
|
|
|
||||||
Current
|
$
|
(31
|
)
|
|
$
|
(768
|
)
|
|
$
|
(431
|
)
|
Deferred
|
(60
|
)
|
|
704
|
|
|
183
|
|
|||
|
(91
|
)
|
|
(64
|
)
|
|
(248
|
)
|
|||
State —
|
|
|
|
|
|
||||||
Current
|
(6
|
)
|
|
(81
|
)
|
|
1
|
|
|||
Deferred
|
(7
|
)
|
|
73
|
|
|
(38
|
)
|
|||
|
(13
|
)
|
|
(8
|
)
|
|
(37
|
)
|
|||
Total
|
$
|
(104
|
)
|
|
$
|
(72
|
)
|
|
$
|
(285
|
)
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Deferred tax liabilities —
|
|
|
|
||||
Accelerated depreciation
|
$
|
386
|
|
|
$
|
1,618
|
|
Property basis difference
|
852
|
|
|
—
|
|
||
Regulatory assets associated with AROs
|
72
|
|
|
71
|
|
||
Pensions and other benefits
|
49
|
|
|
30
|
|
||
Regulatory assets associated with employee benefit obligations
|
70
|
|
|
66
|
|
||
Regulatory assets associated with the Kemper IGCC
|
82
|
|
|
86
|
|
||
Rate differential
|
144
|
|
|
115
|
|
||
Other
|
125
|
|
|
176
|
|
||
Total
|
1,780
|
|
|
2,162
|
|
||
Deferred tax assets —
|
|
|
|
||||
Fuel clause over recovered
|
26
|
|
|
51
|
|
||
Estimated loss on Kemper IGCC
|
484
|
|
|
451
|
|
||
Pension and other benefits
|
96
|
|
|
92
|
|
||
Federal NOL
|
109
|
|
|
17
|
|
||
Property insurance
|
27
|
|
|
25
|
|
||
Premium on long-term debt
|
14
|
|
|
18
|
|
||
AROs
|
72
|
|
|
71
|
|
||
Property basis difference
|
—
|
|
|
451
|
|
||
Deferred state tax assets
|
113
|
|
|
152
|
|
||
Deferred federal tax assets
|
31
|
|
|
31
|
|
||
Federal effect of state deferred taxes
|
19
|
|
|
8
|
|
||
Other
|
33
|
|
|
33
|
|
||
Total
|
1,024
|
|
|
1,400
|
|
||
Total deferred tax liabilities, net
|
756
|
|
|
762
|
|
||
Accumulated deferred income taxes
|
$
|
756
|
|
|
$
|
762
|
|
|
2016
|
|
2015
|
|
2014
|
|||
Federal statutory rate
|
(35.0
|
)%
|
|
(35.0
|
)%
|
|
(35.0
|
)%
|
State income tax, net of federal deduction
|
(5.7
|
)
|
|
(6.3
|
)
|
|
(4.0
|
)
|
Non-deductible book depreciation
|
0.7
|
|
|
1.3
|
|
|
0.1
|
|
AFUDC-equity
|
(28.5
|
)
|
|
(49.6
|
)
|
|
(7.8
|
)
|
Other
|
—
|
|
|
(2.9
|
)
|
|
0.1
|
|
Effective income tax rate (benefit rate)
|
(68.5
|
)%
|
|
(92.5
|
)%
|
|
(46.6
|
)%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Unrecognized tax benefits at beginning of year
|
$
|
421
|
|
|
$
|
165
|
|
|
$
|
4
|
|
Tax positions increase from current periods
|
26
|
|
|
32
|
|
|
58
|
|
|||
Tax positions increase from prior periods
|
18
|
|
|
224
|
|
|
103
|
|
|||
Balance at end of year
|
$
|
465
|
|
|
$
|
421
|
|
|
$
|
165
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Tax positions impacting the effective tax rate
|
$
|
1
|
|
|
$
|
(2
|
)
|
|
$
|
4
|
|
Tax positions not impacting the effective tax rate
|
464
|
|
|
423
|
|
|
161
|
|
|||
Balance of unrecognized tax benefits
|
$
|
465
|
|
|
$
|
421
|
|
|
$
|
165
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Interest accrued at beginning of year
|
$
|
13
|
|
|
$
|
3
|
|
|
$
|
1
|
|
Interest accrued during the year
|
15
|
|
|
10
|
|
|
2
|
|
|||
Balance at end of year
|
$
|
28
|
|
|
$
|
13
|
|
|
$
|
3
|
|
|
2016
|
|
2015
|
||||
|
(in millions)
|
||||||
Parent company loans
|
$
|
551
|
|
|
$
|
—
|
|
Senior notes
|
35
|
|
|
300
|
|
||
Bank term loans
|
—
|
|
|
425
|
|
||
Pollution control revenue bonds
(*)
|
40
|
|
|
—
|
|
||
Capitalized leases
|
3
|
|
|
3
|
|
||
Outstanding at December 31
|
$
|
629
|
|
|
$
|
728
|
|
(*)
|
Pollution control revenue bonds are classified as short term since they are variable rate demand obligations that are supported by short-term credit facilities; however, the final maturity date is in 2028.
|
Preferred Stock
|
Par Value/Stated Capital Per Share
|
|
Shares Outstanding
|
|
Redemption Price Per Share
|
|||||
4.40% Preferred Stock
|
$
|
100
|
|
|
8,867
|
|
|
$
|
104.32
|
|
4.60% Preferred Stock
|
$
|
100
|
|
|
8,643
|
|
|
$
|
107.00
|
|
4.72% Preferred Stock
|
$
|
100
|
|
|
16,700
|
|
|
$
|
102.25
|
|
5.25% Preferred Stock
(*)
|
$
|
100
|
|
|
300,000
|
|
|
$
|
100.00
|
|
(*)
|
There are
1,200,000
outstanding depositary shares, each representing one-fourth of a share of the
5.25%
preferred stock.
|
Expires
|
|
|
|
|
|
Executable
Term Loans
|
|
Expires Within One Year
|
||||
2017
|
|
Total
|
|
Unused
|
|
One
Year
|
|
Two
Years
|
|
Term Out
|
|
No Term Out
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
||||||
$173
|
|
$173
|
|
$150
|
|
$—
|
|
$13
|
|
$13
|
|
$160
|
•
|
Level 1 consists of observable market data in an active market for identical assets or liabilities.
|
•
|
Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.
|
•
|
Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
|
||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
3
|
|
Interest rate derivatives
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
||||
Cash equivalents
|
206
|
|
|
—
|
|
|
—
|
|
|
206
|
|
||||
Total
|
$
|
206
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
212
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
10
|
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
|
||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
52
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
52
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
47
|
|
|
$
|
—
|
|
|
$
|
47
|
|
|
Carrying
Amount
|
|
Fair
Value
|
||||
|
(in millions)
|
||||||
Long-term debt:
|
|
|
|
||||
2016
|
$
|
2,979
|
|
|
$
|
2,922
|
|
2015
|
$
|
2,537
|
|
|
$
|
2,413
|
|
•
|
Regulatory Hedges
– Energy-related derivative contracts which are designated as regulatory hedges relate primarily to the Company's fuel-hedging programs, where gains and losses are initially recorded as regulatory liabilities and assets, respectively, and then are included in fuel expense as the underlying fuel is used in operations and ultimately recovered through the respective fuel cost recovery clauses.
|
•
|
Not Designated
– Gains and losses on energy-related derivative contracts that are not designated or fail to qualify as hedges are recognized in the statements of operations as incurred.
|
|
Notional
Amount |
|
Interest
Rate Received |
|
Weighted Average Interest
Rate Paid |
|
Hedge
Maturity Date |
|
Fair Value
Gain (Loss) December 31, 2016 |
||||
|
(in millions)
|
|
|
|
|
|
|
|
(in millions)
|
||||
Cash Flow Hedges of Existing Debt
|
$
|
900
|
|
|
1-month LIBOR
|
|
0.79%
|
|
March 2018
|
|
$
|
3
|
|
|
2016
|
2015
|
||||||||||
Derivative Category and Balance Sheet Location
|
Assets
|
Liabilities
|
Assets
|
Liabilities
|
||||||||
|
(in millions)
|
|||||||||||
Derivatives designated as hedging instruments for regulatory purposes
|
|
|
|
|
||||||||
Energy-related derivatives:
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
$
|
2
|
|
$
|
6
|
|
$
|
—
|
|
$
|
29
|
|
Other deferred charges and assets/Other deferred credits and liabilities
|
2
|
|
5
|
|
—
|
|
18
|
|
||||
Total derivatives designated as hedging instruments for regulatory purposes
|
$
|
4
|
|
$
|
11
|
|
$
|
—
|
|
$
|
47
|
|
Derivatives designated as hedging instruments in cash flow and fair value hedges
|
|
|
|
|
||||||||
Interest rate derivatives:
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
$
|
2
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Other deferred charges and assets/Other deferred credits and liabilities
|
1
|
|
—
|
|
—
|
|
—
|
|
||||
Total derivatives designated as hedging instruments in cash flow and fair value hedges
|
$
|
3
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Gross amounts recognized
|
$
|
7
|
|
$
|
11
|
|
$
|
—
|
|
$
|
47
|
|
Gross amounts offset
|
$
|
(3
|
)
|
$
|
(3
|
)
|
$
|
—
|
|
$
|
—
|
|
Net amounts recognized in the Balance Sheets
(*)
|
$
|
4
|
|
$
|
8
|
|
$
|
—
|
|
$
|
47
|
|
(*)
|
At
December 31, 2015
, the fair value amounts for derivative contracts subject to netting arrangements were presented gross on the balance sheet.
|
|
Unrealized Losses
|
|
Unrealized Gains
|
||||||||||||||
Derivative Category
|
Balance Sheet
Location
|
2016
|
|
2015
|
|
Balance Sheet
Location
|
2016
|
|
2015
|
|
|||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Energy-related derivatives:
(*)
|
Other regulatory assets, current
|
$
|
(5
|
)
|
|
$
|
(29
|
)
|
|
Other regulatory liabilities, current
|
$
|
1
|
|
|
$
|
—
|
|
|
Other regulatory assets, deferred
|
(3
|
)
|
|
(18
|
)
|
|
Other regulatory liabilities, deferred
|
—
|
|
|
—
|
|
||||
Total energy-related derivative gains (losses)
|
|
$
|
(8
|
)
|
|
$
|
(47
|
)
|
|
|
$
|
1
|
|
|
$
|
—
|
|
(*)
|
At
December 31, 2016
, the unrealized gains and losses for derivative contracts subject to netting arrangements were presented net on the balance sheet. At
December 31, 2015
, the unrealized gains and losses for derivative contracts were presented gross on the balance sheet.
|
Quarter Ended
|
Operating
Revenues
|
|
Operating
Income (Loss)
|
|
Net Income (Loss) After Dividends on Preferred Stock
|
||||||
|
(in millions)
|
||||||||||
March 2016
|
$
|
257
|
|
|
$
|
(10
|
)
|
|
$
|
11
|
|
June 2016
|
277
|
|
|
(28
|
)
|
|
2
|
|
|||
September 2016
|
352
|
|
|
9
|
|
|
26
|
|
|||
December 2016
|
277
|
|
|
(166
|
)
|
|
(89
|
)
|
|||
|
|
|
|
|
|
||||||
March 2015
|
$
|
276
|
|
|
$
|
24
|
|
|
$
|
35
|
|
June 2015
|
275
|
|
|
12
|
|
|
49
|
|
|||
September 2015
|
341
|
|
|
(66
|
)
|
|
(21
|
)
|
|||
December 2015
|
246
|
|
|
(143
|
)
|
|
(71
|
)
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
Operating Revenues (in millions)
|
$
|
1,163
|
|
|
$
|
1,138
|
|
|
$
|
1,243
|
|
|
$
|
1,145
|
|
|
$
|
1,036
|
|
Net Income (Loss) After Dividends
on Preferred Stock (in millions)
|
$
|
(50
|
)
|
|
$
|
(8
|
)
|
|
$
|
(329
|
)
|
|
$
|
(477
|
)
|
|
$
|
100
|
|
Cash Dividends
on Common Stock (in millions)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
72
|
|
|
$
|
107
|
|
Return on Average Common Equity (percent)
|
(1.87
|
)
|
|
(0.34
|
)
|
|
(15.43
|
)
|
|
(24.28
|
)
|
|
7.14
|
|
|||||
Total Assets (in millions)
(a)(b)
|
$
|
8,235
|
|
|
$
|
7,840
|
|
|
$
|
6,642
|
|
|
$
|
5,822
|
|
|
$
|
5,334
|
|
Gross Property Additions (in millions)
|
$
|
946
|
|
|
$
|
972
|
|
|
$
|
1,389
|
|
|
$
|
1,773
|
|
|
$
|
1,665
|
|
Capitalization (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
$
|
2,943
|
|
|
$
|
2,359
|
|
|
$
|
2,084
|
|
|
$
|
2,177
|
|
|
$
|
1,749
|
|
Redeemable preferred stock
|
33
|
|
|
33
|
|
|
33
|
|
|
33
|
|
|
33
|
|
|||||
Long-term debt
(a)
|
2,424
|
|
|
1,886
|
|
|
1,621
|
|
|
2,157
|
|
|
1,561
|
|
|||||
Total (excluding amounts due within one year)
|
$
|
5,400
|
|
|
$
|
4,278
|
|
|
$
|
3,738
|
|
|
$
|
4,367
|
|
|
$
|
3,343
|
|
Capitalization Ratios (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
54.5
|
|
|
55.1
|
|
|
55.8
|
|
|
49.9
|
|
|
52.3
|
|
|||||
Redeemable preferred stock
|
0.6
|
|
|
0.8
|
|
|
0.9
|
|
|
0.7
|
|
|
1.0
|
|
|||||
Long-term debt
(a)
|
44.9
|
|
|
44.1
|
|
|
43.3
|
|
|
49.4
|
|
|
46.7
|
|
|||||
Total (excluding amounts due within one year)
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|||||
Customers (year-end):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
153,172
|
|
|
153,158
|
|
|
152,453
|
|
|
152,585
|
|
|
152,265
|
|
|||||
Commercial
|
33,783
|
|
|
33,663
|
|
|
33,496
|
|
|
33,250
|
|
|
33,112
|
|
|||||
Industrial
|
451
|
|
|
467
|
|
|
482
|
|
|
480
|
|
|
472
|
|
|||||
Other
|
175
|
|
|
175
|
|
|
175
|
|
|
175
|
|
|
175
|
|
|||||
Total
|
187,581
|
|
|
187,463
|
|
|
186,606
|
|
|
186,490
|
|
|
186,024
|
|
|||||
Employees (year-end)
|
1,484
|
|
|
1,478
|
|
|
1,478
|
|
|
1,344
|
|
|
1,281
|
|
(a)
|
A reclassification of debt issuance costs from Total Assets to Long-term debt of $9 million, $11 million, and $4 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
(b)
|
A reclassification of deferred tax assets from Total Assets of $105 million, $16 million, and $36 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
$
|
260
|
|
|
$
|
238
|
|
|
$
|
239
|
|
|
$
|
242
|
|
|
$
|
227
|
|
Commercial
|
279
|
|
|
256
|
|
|
257
|
|
|
266
|
|
|
251
|
|
|||||
Industrial
|
313
|
|
|
287
|
|
|
291
|
|
|
289
|
|
|
263
|
|
|||||
Other
|
7
|
|
|
(5
|
)
|
|
8
|
|
|
2
|
|
|
6
|
|
|||||
Total retail
|
859
|
|
|
776
|
|
|
795
|
|
|
799
|
|
|
747
|
|
|||||
Wholesale — non-affiliates
|
261
|
|
|
270
|
|
|
323
|
|
|
294
|
|
|
256
|
|
|||||
Wholesale — affiliates
|
26
|
|
|
76
|
|
|
107
|
|
|
35
|
|
|
16
|
|
|||||
Total revenues from sales of electricity
|
1,146
|
|
|
1,122
|
|
|
1,225
|
|
|
1,128
|
|
|
1,019
|
|
|||||
Other revenues
|
17
|
|
|
16
|
|
|
18
|
|
|
17
|
|
|
17
|
|
|||||
Total
|
$
|
1,163
|
|
|
$
|
1,138
|
|
|
$
|
1,243
|
|
|
$
|
1,145
|
|
|
$
|
1,036
|
|
Kilowatt-Hour Sales (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
2,051
|
|
|
2,025
|
|
|
2,126
|
|
|
2,088
|
|
|
2,046
|
|
|||||
Commercial
|
2,842
|
|
|
2,806
|
|
|
2,860
|
|
|
2,865
|
|
|
2,916
|
|
|||||
Industrial
|
4,906
|
|
|
4,958
|
|
|
4,943
|
|
|
4,739
|
|
|
4,702
|
|
|||||
Other
|
39
|
|
|
40
|
|
|
40
|
|
|
40
|
|
|
38
|
|
|||||
Total retail
|
9,838
|
|
|
9,829
|
|
|
9,969
|
|
|
9,732
|
|
|
9,702
|
|
|||||
Wholesale — non-affiliates
|
3,920
|
|
|
3,852
|
|
|
4,191
|
|
|
3,929
|
|
|
3,819
|
|
|||||
Wholesale — affiliates
|
1,108
|
|
|
2,807
|
|
|
2,900
|
|
|
931
|
|
|
572
|
|
|||||
Total
|
14,866
|
|
|
16,488
|
|
|
17,060
|
|
|
14,592
|
|
|
14,093
|
|
|||||
Average Revenue Per Kilowatt-Hour (cents)
(*)
:
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential
|
12.68
|
|
|
11.75
|
|
|
11.26
|
|
|
11.59
|
|
|
11.09
|
|
|||||
Commercial
|
9.82
|
|
|
9.12
|
|
|
8.99
|
|
|
9.27
|
|
|
8.60
|
|
|||||
Industrial
|
6.38
|
|
|
5.79
|
|
|
5.89
|
|
|
6.10
|
|
|
5.59
|
|
|||||
Total retail
|
8.73
|
|
|
7.90
|
|
|
7.97
|
|
|
8.21
|
|
|
7.70
|
|
|||||
Wholesale
|
5.71
|
|
|
5.20
|
|
|
6.06
|
|
|
6.76
|
|
|
6.19
|
|
|||||
Total sales
|
7.71
|
|
|
6.80
|
|
|
7.18
|
|
|
7.73
|
|
|
7.23
|
|
|||||
Residential Average Annual
Kilowatt-Hour Use Per Customer
|
13,383
|
|
|
13,242
|
|
|
13,934
|
|
|
13,680
|
|
|
13,426
|
|
|||||
Residential Average Annual
Revenue Per Customer
|
$
|
1,697
|
|
|
$
|
1,556
|
|
|
$
|
1,568
|
|
|
$
|
1,585
|
|
|
$
|
1,489
|
|
Plant Nameplate Capacity
Ratings (year-end) (megawatts)
|
3,481
|
|
|
3,561
|
|
|
3,867
|
|
|
3,088
|
|
|
3,088
|
|
|||||
Maximum Peak-Hour Demand (megawatts):
|
|
|
|
|
|
|
|
|
|
||||||||||
Winter
|
2,195
|
|
|
2,548
|
|
|
2,618
|
|
|
2,083
|
|
|
2,168
|
|
|||||
Summer
|
2,384
|
|
|
2,403
|
|
|
2,345
|
|
|
2,352
|
|
|
2,435
|
|
|||||
Annual Load Factor (percent)
|
64.0
|
|
|
60.6
|
|
|
59.4
|
|
|
64.7
|
|
|
61.9
|
|
|||||
Plant Availability Fossil-Steam (percent)
|
91.4
|
|
|
90.6
|
|
|
87.6
|
|
|
89.3
|
|
|
91.5
|
|
|||||
Source of Energy Supply (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Coal
|
8.0
|
|
|
16.5
|
|
|
39.7
|
|
|
32.7
|
|
|
22.8
|
|
|||||
Oil and gas
|
84.9
|
|
|
81.6
|
|
|
55.3
|
|
|
57.1
|
|
|
63.9
|
|
|||||
Purchased power —
|
|
|
|
|
|
|
|
|
|
||||||||||
From non-affiliates
|
(0.3
|
)
|
|
0.4
|
|
|
1.4
|
|
|
2.0
|
|
|
2.0
|
|
|||||
From affiliates
|
7.4
|
|
|
1.5
|
|
|
3.6
|
|
|
8.2
|
|
|
11.3
|
|
|||||
Total
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
(*)
|
The average revenue per kilowatt-hour (cents) is based on booked operating revenues and will not match billed revenue per kilowatt-hour.
|
Term
|
Meaning
|
Alabama Power
|
Alabama Power Company
|
AOCI
|
Accumulated other comprehensive income
|
ASC
|
Accounting Standards Codification
|
ASU
|
Accounting Standards Update
|
Clean Air Act
|
Clean Air Act Amendments of 1990
|
CO
2
|
Carbon dioxide
|
COD
|
Commercial operation date
|
CWIP
|
Construction work in progress
|
EMC
|
Electric Membership Corporation
|
EPA
|
U.S. Environmental Protection Agency
|
EPE
|
El Paso Electric Company
|
FASB
|
Financial Accounting Standards Board
|
FERC
|
Federal Energy Regulatory Commission
|
First Solar
|
First Solar, Inc.
|
FPL
|
Florida Power & Light Company
|
GAAP
|
U.S. generally accepted accounting principles
|
Georgia Power
|
Georgia Power Company
|
Gulf Power
|
Gulf Power Company
|
Invenergy
|
Invenergy Wind Global LLC
|
IRS
|
Internal Revenue Service
|
ITC
|
Investment tax credit
|
KWH
|
Kilowatt-hour
|
LTSA
|
Long-term service agreement
|
Mississippi Power
|
Mississippi Power Company
|
mmBtu
|
Million British thermal units
|
Moody's
|
Moody's Investors Service, Inc.
|
MW
|
Megawatt
|
MWH
|
Megawatt hour
|
OCI
|
Other comprehensive income
|
power pool
|
The operating arrangement whereby the integrated generating resources of the traditional electric operating companies and Southern Power (excluding subsidiaries) are subject to joint commitment and dispatch in order to serve their combined load obligations
|
PPA
|
Power purchase agreements and contracts for differences that provide the owner of a renewable facility a certain fixed price for the electricity sold to the grid
|
PTC
|
Production tax credit
|
Recurrent
|
Recurrent Energy, LLC
|
S&P
|
S&P Global Ratings, a division of S&P Global Inc.
|
SCE
|
Southern California Edison Company
|
SCS
|
Southern Company Services, Inc. (the Southern Company system service company)
|
SEC
|
U.S. Securities and Exchange Commission
|
Southern Company
|
The Southern Company
|
Southern Company Gas
|
Southern Company Gas (formerly known as AGL Resources Inc.) and its subsidiaries
|
Southern Company system
|
Southern Company, the traditional electric operating companies, Southern Power Company, Southern Company Gas (as of July 1, 2016), Southern Electric Generating Company, Southern Nuclear, SCS, Southern LINC, PowerSecure, Inc. (as of May 9, 2016), and other subsidiaries
|
Southern LINC
|
Southern Communications Services, Inc.
|
Southern Nuclear
|
Southern Nuclear Operating Company, Inc.
|
Term
|
Meaning
|
SRE
|
Southern Renewable Energy, Inc. owned 100% by Southern Power Company
|
SRP
|
Southern Renewable Partnerships, LLC owned 100% by Southern Power Company
|
STR
|
Southern Turner Renewable Energy, LLC owned 90% by SRE and 10% by TRE
|
SunPower
|
SunPower Corp.
|
traditional electric operating companies
|
Alabama Power, Georgia Power, Gulf Power, and Mississippi Power
|
TRE
|
Turner Renewable Energy, LLC, a 10% partner with SRE
|
|
Amount
|
|
Increase (Decrease)
from Prior Year
|
||||||||
|
2016
|
|
2016
|
|
2015
|
||||||
|
(in millions)
|
||||||||||
Operating revenues
|
$
|
1,577
|
|
|
$
|
187
|
|
|
$
|
(111
|
)
|
Fuel
|
456
|
|
|
15
|
|
|
(155
|
)
|
|||
Purchased power
|
102
|
|
|
9
|
|
|
(78
|
)
|
|||
Other operations and maintenance
|
354
|
|
|
94
|
|
|
23
|
|
|||
Depreciation and amortization
|
352
|
|
|
104
|
|
|
28
|
|
|||
Taxes other than income taxes
|
23
|
|
|
1
|
|
|
—
|
|
|||
Total operating expenses
|
1,287
|
|
|
223
|
|
|
(182
|
)
|
|||
Operating income
|
290
|
|
|
(36
|
)
|
|
71
|
|
|||
Interest expense, net of amounts capitalized
|
117
|
|
|
40
|
|
|
(12
|
)
|
|||
Other income (expense), net
|
6
|
|
|
5
|
|
|
(5
|
)
|
|||
Income taxes (benefit)
|
(195
|
)
|
|
(216
|
)
|
|
24
|
|
|||
Net income
|
374
|
|
|
145
|
|
|
54
|
|
|||
Less: Net income attributable to noncontrolling interests
|
36
|
|
|
22
|
|
|
11
|
|
|||
Net income attributable to the Company
|
$
|
338
|
|
|
$
|
123
|
|
|
$
|
43
|
|
•
|
Capacity revenues generally represent the greatest contribution to net income and are designed to provide recovery of fixed costs plus a return on investment.
|
•
|
Energy is generally sold at variable cost or is indexed to published gas indices. Energy revenues will vary depending on the energy demand of the Company's customers and their generation capacity, as well as the market prices of wholesale energy compared to the cost of the Company's energy. Energy revenues also include fees for support services, fuel storage, and unit start charges. Increases and decreases in energy revenues under PPAs that are driven by fuel or purchased power prices are accompanied by an increase or decrease in fuel and purchased power costs and do not have a significant impact on net income.
|
•
|
The Company's electricity sales from solar and wind generating facilities are predominantly through long-term PPAs; however, these solar and wind PPAs do not have a capacity charge and customers either purchase the energy output of a dedicated renewable facility through an energy charge or pay a fixed price for electricity sold to the grid. As a result, the Company's ability to recover fixed and variable operations and maintenance expenses is dependent upon the level of energy generated from these facilities, which can be impacted by weather conditions, equipment performance, and other factors.
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
|
(in millions)
|
|
|
||||||
PPA capacity revenues
|
$
|
541
|
|
|
$
|
569
|
|
|
$
|
546
|
|
PPA energy revenues
|
694
|
|
|
560
|
|
|
638
|
|
|||
Total PPA revenues
|
1,235
|
|
|
1,129
|
|
|
1,184
|
|
|||
Non-PPA revenues
|
330
|
|
|
252
|
|
|
315
|
|
|||
Other revenues
|
12
|
|
|
9
|
|
|
2
|
|
|||
Total operating revenues
|
$
|
1,577
|
|
|
$
|
1,390
|
|
|
$
|
1,501
|
|
•
|
PPA capacity revenues
decreased $28 million as a result of a $44 million decrease in non-affiliate capacity revenues primarily as a result of PPA expirations and subsequent generation capacity remarketing into the short-term markets, partially offset by a $16 million increase in affiliate capacity revenues due to new PPAs.
|
•
|
PPA energy revenues increased $134 million primarily due to a $170 million increase in renewable energy sales arising from new solar and wind facilities, partially offset by a decrease of $36 million in fuel revenues related to PPAs served by natural gas facilities. Overall, total KWH sales under PPAs increased 7% in 2016 when compared to 2015.
|
•
|
Non-PPA revenues increased $78 million primarily due to a 23% increase in KWH sales. Underlying this increase was a $113 million increase in short-term sales to non-affiliates as a result of remarketing generation capacity from expired PPAs, partially offset by a $35 million decrease in power pool sales primarily associated with a reduction in capacity available for sale.
|
•
|
PPA capacity revenues
increased $23 million ($50 million increase related to affiliates, partially offset by a $27 million decrease related to non-affiliates), primarily due to a 1% increase in total MW capacity contracted with affiliates associated with new natural gas PPAs.
|
•
|
PPA energy revenues decreased $78 million due to a $141 million decrease primarily related to a 34% decrease in the average price of energy driven by lower natural gas prices passed through in fuel revenues, partially offset by a 13% increase in KWH sales. This decrease in natural gas PPA energy revenues was partially offset by a $63 million increase in energy revenues from PPAs related to the Company's acquisitions of solar and wind facilities. Overall, total KWH sales under PPAs increased 15% in 2015 when compared to 2014.
|
•
|
Non-PPA revenues decreased $63 million primarily due to lower natural gas prices, partially offset by a 19% increase in non-PPA KWH sales.
|
|
Total
KWHs |
Total KWH % Change
|
Total
KWHs |
Total KWH % Change
|
|
2016
|
|
2015
|
|
|
(in billions of KWHs)
|
|||
Generation
|
37
|
|
33
|
|
Purchased power
|
3
|
|
2
|
|
Total generation and purchased power
|
40
|
14%
|
35
|
17%
|
Total generation and purchased power excluding solar, wind, and tolling agreements
|
23
|
10%
|
21
|
5%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
|
(in millions)
|
|
|
||||||
Fuel
|
$
|
456
|
|
|
$
|
441
|
|
|
$
|
596
|
|
Purchased power
|
102
|
|
|
93
|
|
|
171
|
|
|||
Total fuel and purchased power expenses
|
$
|
558
|
|
|
$
|
534
|
|
|
$
|
767
|
|
•
|
Fuel expense
increased $15 million, or 3%, primarily due to a $22 million increase associated with the volume of KWHs generated, partially offset by a $7 million decrease associated with the average cost of natural gas per KWH generated.
|
•
|
Purchased power expense increased $9 million, or 10%, primarily due to a $53 million increase associated with the volume of KWHs purchased, partially offset by a $28 million decrease associated with the average cost of purchased power and a $16 million decrease associated with a PPA expiration.
|
•
|
Fuel expense
decreased $155 million, or 26%, primarily due to a $228 million decrease associated with the average cost of natural gas per KWH generated, partially offset by a $73 million increase associated with the volume of KWHs generated.
|
•
|
Purchased power expense decreased $78 million, or 46%, primarily due to a $60 million decrease associated with the volume of KWHs purchased as well as an $18 million decrease associated with the average cost of purchased power.
|
Project Facility
|
Resource
|
Approximate Nameplate Capacity (
MW
)
|
Location
|
Percentage Ownership
|
Actual/Expected COD
|
PPA Counterparties
|
PPA Contract Period
|
|
Acquisitions During the Year Ended December 31, 2016
|
||||||||
Boulder 1
|
Solar
|
100
|
Clark County, NV
|
51%
|
(a)
|
December 2016
|
Nevada Power Company
|
20 years
|
Calipatria
|
Solar
|
20
|
Imperial County, CA
|
90%
|
(b)
|
February 2016
|
San Diego Gas & Electric Company
|
20 years
|
East Pecos
|
Solar
|
120
|
Pecos County, TX
|
100%
|
|
March 2017
|
Austin Energy
|
15 years
|
Grant Plains
|
Wind
|
147
|
Grant County, OK
|
100%
|
|
December 2016
|
Oklahoma Municipal Power Authority and Steelcase Inc.
|
20 years and 12 years
(c)
|
Grant Wind
|
Wind
|
151
|
Grant County, OK
|
100%
|
|
April 2016
|
Western Farmers, East Texas, and Northeast Texas Electric Cooperatives
|
20 years
|
Henrietta
|
Solar
|
102
|
Kings County, CA
|
51%
|
(a)
|
July 2016
|
Pacific Gas & Electric Company
|
20 years
|
Lamesa
|
Solar
|
102
|
Dawson County, TX
|
100%
|
|
Second quarter 2017
|
City of Garland, Texas
|
15 years
|
Mankato
(d)
|
Natural Gas
|
375
|
Mankato, MN
|
100%
|
|
N/A
(e)
|
Northern States Power Company
|
10 years
|
Passadumkeag
|
Wind
|
42
|
Penobscot County, ME
|
100%
|
|
July 2016
|
Western Massachusetts Electric Company
|
15 years
|
Rutherford
|
Solar
|
74
|
Rutherford County, NC
|
90%
|
(b)
|
December 2016
|
Duke Energy Carolinas, LLC
|
15 years
|
Salt Fork
|
Wind
|
174
|
Donley and Gray Counties, TX
|
100%
|
|
December 2016
|
City of Garland, Texas and Salesforce.com, Inc.
|
14 years and 12 years
|
Tyler Bluff
|
Wind
|
125
|
Cooke County, TX
|
100%
|
|
December 2016
|
The Proctor & Gamble Company
|
12 years
|
Wake Wind
|
Wind
|
257
|
Floyd and Crosby Counties, TX
|
90.1%
|
(f)
|
October 2016
|
Equinix Enterprises, Inc. and Owens Corning
|
12 years
|
Acquisitions Subsequent to December 31, 2016
|
||||||||
Bethel
|
Wind
|
276
|
Castro County, TX
|
100%
|
|
January 2017
|
Google Energy, Inc.
|
12 years
|
(a)
|
The Company owns
100%
of the class A membership interests and a wholly-owned subsidiary of the seller owns
100%
of the class B membership interests. The Company and the class B member are entitled to
51%
and
49%
, respectively, of all cash distributions from the project. In addition, the Company is entitled to substantially all of the federal tax benefits with respect to the transaction.
|
(b)
|
The Company owns 90%, with the minority owner, TRE, owning 10%.
|
(c)
|
In addition to the
20
-year and
12
-year PPAs, the facility has a
10
-year contract with Allianz Risk Transfer (Bermuda) Ltd.
|
(d)
|
Under the terms of the remaining 10-year PPA and the 20-year expansion PPA, approximately
$408 million
of assets, primarily related to property, plant, and equipment, are subject to lien at December 31, 2016.
|
(e)
|
The acquisition included a fully operational
375
-MW natural gas-fired combined-cycle facility.
|
(f)
|
The Company owns 90.1%, with the minority owner, Invenergy, owning 9.9%.
|
|
2016
|
2015
|
||||
|
(in millions)
|
|||||
Revenues
|
$
|
40,000,000
|
|
$
|
39,000,000
|
|
Net income
|
$
|
14,000,000
|
|
$
|
11,000,000
|
|
Solar Facility
|
Approximate Nameplate Capacity (
MW
)
|
Location
|
Actual COD
|
PPA Counterparties
|
PPA Contract Period
|
Projects Completed During the Year Ended December 31, 2016
|
|||||
Butler
|
103
|
Taylor County, GA
|
December 2016
|
Georgia Power
(a)
|
30 years
|
Butler Solar Farm
|
22
|
Taylor County, GA
|
February 2016
|
Georgia Power
(a)
|
20 years
|
Desert Stateline
|
299
(b)
|
San Bernardino County, CA
|
From December 2015 to July 2016
|
SCE
|
20 years
|
Garland
|
185
|
Kern County, CA
|
October 2016
|
SCE
|
15 years
|
Garland A
|
20
|
Kern County, CA
|
August 2016
|
SCE
|
20 years
|
Pawpaw
|
30
|
Taylor County, GA
|
March 2016
|
Georgia Power
(a)
|
30 years
|
Roserock
(c)
|
160
|
Pecos County, TX
|
November 2016
|
Austin Energy
|
20 years
|
Sandhills
|
146
|
Taylor County, GA
|
October 2016
|
Cobb, Flint, Irwin, Middle Georgia and Sawnee Electric Membership Corporations
|
25 years
|
Tranquillity
|
205
|
Fresno County, CA
|
July 2016
|
Shell Energy North America (US), LP/SCE
|
18 years
|
(a)
|
Affiliate PPA approved by the FERC.
|
(b)
|
The facility has a total of
299
MWs, of which
110
MWs were placed in service in the fourth quarter 2015 and
189
MWs were placed in service through July 2016.
|
(c)
|
Prior to placing the Roserock facility in service, certain solar panels were damaged. While the facility is currently generating energy as expected, the Company is pursuing remedies under its insurance policies and other contracts to repair or replace these solar panels.
|
Project Facility
|
Resource
|
Approximate Nameplate Capacity (
MW
)
|
Location
|
Actual/Expected COD
|
PPA Counterparties
|
PPA Contract Period
|
East Pecos
|
Solar
|
120
|
Pecos County, TX
|
March 2017
|
Austin Energy
|
15 years
|
Lamesa
|
Solar
|
102
|
Dawson County, TX
|
Second quarter 2017
|
City of Garland, Texas
|
15 years
|
Mankato
|
Natural Gas
|
345
|
Mankato, MN
|
Second quarter 2019
|
Northern States Power Company
|
20 years
|
•
|
Assessing whether specific property is explicitly or implicitly identified in the agreement;
|
•
|
Determining whether the fulfillment of the arrangement is dependent on the use of the identified property; and
|
•
|
Assessing whether the arrangement conveys to the purchaser the right to use the identified property.
|
•
|
Assessing whether the contract meets the definition of a derivative;
|
•
|
Assessing whether the contract meets the definition of a capacity contract;
|
•
|
Assessing the probability at inception and throughout the term of the individual contract that the contract will result in physical delivery; and
|
•
|
Ensuring that the contract quantities do not exceed available generating capacity (including purchased capacity).
|
•
|
Identifying the hedging instrument, the forecasted hedged transaction, and the nature of the risk being hedged; and
|
•
|
Assessing hedge effectiveness at inception and throughout the contract term.
|
•
|
Future demand for electricity based on projections of economic growth and estimates of available generating capacity;
|
•
|
Future power and natural gas prices, which have been quite volatile in recent years; and
|
•
|
Future operating costs.
|
|
Commercial Paper at the
End of the Period
|
|
Commercial Paper During the Period
(*)
|
||||||||||||
|
Amount Outstanding
|
|
Weighted Average Interest Rate
|
|
Average Amount Outstanding
|
|
Weighted Average Interest Rate
|
|
Maximum Amount Outstanding
|
||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
|
(in millions)
|
||||||
December 31, 2016
|
$
|
—
|
|
|
N/A
|
|
$
|
56
|
|
|
0.8%
|
|
$
|
310
|
|
December 31, 2015
|
$
|
—
|
|
|
N/A
|
|
$
|
166
|
|
|
0.5%
|
|
$
|
385
|
|
December 31, 2014
|
$
|
195
|
|
|
0.4%
|
|
$
|
54
|
|
|
0.4%
|
|
$
|
445
|
|
(*)
|
Average and maximum amounts are based upon daily balances during the twelve-month periods ended
December 31, 2016
,
2015
, and
2014
.
|
Project
|
|
Construction Loan Facility
|
|
Bridge Loan Facility
|
|
Total Loan Facility
|
|
Loan Facility Undrawn
|
|
Letter of Credit Facility
|
|
Letter of Credit Facility Undrawn
|
||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||
Roserock
|
|
$
|
63
|
|
|
$
|
180
|
|
|
$
|
243
|
|
|
$
|
34
|
|
|
$
|
23
|
|
|
$
|
16
|
|
Credit Ratings
|
Maximum Potential Collateral Requirements
|
||
|
(in millions)
|
||
At BBB and/or Baa2
|
$
|
38
|
|
At BBB- and/or Baa3
|
$
|
411
|
|
At BB+ and/or Ba1
(*)
|
$
|
1,167
|
|
(*)
|
Any additional credit rating downgrades at or below BB- and/or Ba3 could increase collateral requirements up to an additional $91 million
.
|
|
2016
|
2015
|
||||
|
(in millions)
|
|||||
Contracts outstanding at the beginning of period, assets (liabilities), net
|
$
|
1
|
|
$
|
2
|
|
Contracts realized or settled
|
(3
|
)
|
(1
|
)
|
||
Current period changes
(*)
|
18
|
|
—
|
|
||
Contracts outstanding at the end of period, assets (liabilities), net
|
$
|
16
|
|
$
|
1
|
|
(*)
|
Current period changes also include changes in the fair value of new contracts entered into during the period, if any.
|
|
2016
|
2015
|
||||
Power – net sold
|
|
|
||||
MWH (in millions)
|
6.1
|
|
1.8
|
|
||
Weighted average contract cost per MWH above (below) market prices (in dollars)
|
$
|
1.45
|
|
$
|
(0.08
|
)
|
Gas – net purchased
|
|
|
||||
Commodity - mmBtu
|
27.1
|
|
9.6
|
|
||
Commodity - weighted average contract cost per mmBtu above (below) market prices (in dollars)
|
$
|
(0.27
|
)
|
$
|
(0.14
|
)
|
|
2017
|
|
2018-
2019
|
|
2020-
2021
|
|
After
2021
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Long-term debt
(a)
—
|
|
|
|
|
|
|
|
|
|
||||||||||
Principal
|
$
|
561
|
|
|
$
|
1,270
|
|
|
$
|
600
|
|
|
$
|
3,321
|
|
|
$
|
5,752
|
|
Interest
|
184
|
|
|
335
|
|
|
294
|
|
|
1,667
|
|
|
2,480
|
|
|||||
Financial derivative obligations
(b)
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|||||
Operating leases
(c)
|
18
|
|
|
39
|
|
|
40
|
|
|
762
|
|
|
859
|
|
|||||
Unrecognized tax benefits
(d)
|
17
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|||||
Purchase commitments —
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital
(e)
|
1,525
|
|
|
3,080
|
|
|
3,064
|
|
|
—
|
|
|
7,669
|
|
|||||
Fuel
(f)
|
515
|
|
|
684
|
|
|
393
|
|
|
99
|
|
|
1,691
|
|
|||||
Purchased power
(g)
|
39
|
|
|
81
|
|
|
83
|
|
|
—
|
|
|
203
|
|
|||||
Other
(h)
|
223
|
|
|
200
|
|
|
514
|
|
|
2,007
|
|
|
2,944
|
|
|||||
Total
|
$
|
3,087
|
|
|
$
|
5,689
|
|
|
$
|
4,988
|
|
|
$
|
7,856
|
|
|
$
|
21,620
|
|
(a)
|
All amounts are reflected based on final maturity dates and include the effects of interest rate derivatives employed to manage interest rate risk and effects of foreign currency swaps employed to manage foreign currency exchange rate risk. Included in debt principal is $82 million related to the foreign currency hedge of €1.1 billion. The Company plans to continue, when economically feasible, to retire higher-cost securities and replace these obligations with lower-cost capital if market conditions permit.
|
(b)
|
For additional information, see Notes 1 and 9 to the financial statements.
|
(c)
|
Operating lease commitments include certain land leases for solar and wind facilities that are subject to annual price escalation based on indices. See Note 7 to the financial statements under "Commitments" for additional information.
|
(d)
|
See Note 5 to the financial statements under "Unrecognized Tax Benefits" for additional information.
|
(e)
|
The Company provides estimated capital expenditures for a five-year period, including capital expenditures associated with environmental regulations. Amounts represent current estimates of total expenditures, excluding capital expenditures covered under LTSAs which are reflected in "Other." See Note (h) below. At December 31, 2016, significant purchase commitments were outstanding in connection with the construction program.
|
(f)
|
Primarily includes commitments to purchase, transport, and store natural gas fuel. Amounts reflected are based on contracted cost and may contain provisions for price escalation. Amounts reflected for natural gas purchase commitments are based on various indices at the time of delivery and have been estimated based on the New York Mercantile Exchange future prices at
December 31, 2016
.
|
(g)
|
Purchased power commitments will be resold under a third party agreement at cost.
|
(h)
|
Includes commitments related to LTSAs, operation and maintenance agreements, and transmission. LTSAs include price escalation based on inflation indices. Transmission commitments are based on the Southern Company system's current tariff rate for point-to-point transmission.
|
•
|
the impact of recent and future federal and state regulatory changes, including environmental laws regulating emissions, discharges, and disposal to air, water, and land
,
and also changes in tax and other laws and regulations to which
the Company is
subject, including potential tax reform legislation, as well as changes in application of existing laws and regulations;
|
•
|
current and future litigation, regulatory investigations, proceedings, or inquiries
;
|
•
|
the effects, extent, and timing of the entry of additional competition in the markets in which
the Company operates;
|
•
|
variations in demand for
electricity,
including those relating to weather, the general economy and recovery from the last recession, population and business growth (and declines), the effects of energy conservation and efficiency measures, including from the development and deployment of alternative energy sources such as self-generation and distributed generation technologies, and any potential economic impacts resulting from federal fiscal decisions;
|
•
|
available sources and costs of
fuels;
|
•
|
effects of inflation;
|
•
|
the ability to control costs and avoid cost overruns during the development
and construction of generating facilities,
to construct facilities in accordance with the requirements of permits and licenses,
and
to satisfy any environmental performance standards
, including
the requirements of tax credits and other incentives
;
|
•
|
advances in technology;
|
•
|
state and federal rate regulations
;
|
•
|
the ability to successfully operate generating facilities and the successful performance of necessary corporate functions;
|
•
|
internal restructuring or other restructuring options that may be pursued;
|
•
|
potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to
the Company;
|
•
|
the ongoing renewable energy partnerships and development agreements;
|
•
|
the ability of counterparties of
the Company
to make payments as and when due and to perform as required;
|
•
|
the ability to obtain new short- and long-term contracts with wholesale customers;
|
•
|
the direct or indirect effect on the
Company's
business resulting from cyber intrusion or terrorist incidents and the threat of terrorist incidents;
|
•
|
interest rate fluctuations and financial market conditions and the results of financing efforts;
|
•
|
changes in the Company's
credit ratings, including impacts on interest rates, access to capital markets, and collateral requirements;
|
•
|
the impacts of any sovereign financial issues, including impacts on interest rates, access to capital markets, impacts on foreign currency exchange rates, counterparty performance, and the economy in general
;
|
•
|
the ability of
the Company
to obtain additional generating capacity (or sell excess generating capacity) at competitive prices;
|
•
|
catastrophic events such as fires, earthquakes, explosions, floods, tornadoes,
hurricanes and other storms, droughts, pandemic health events such as influenzas, or other similar occurrences;
|
•
|
the direct or indirect effects on the
Company's
business resulting from incidents affecting the U.S. electric grid
or operation of generating
resources;
|
•
|
the effect of accounting pronouncements issued periodically by standard-setting bodies; and
|
•
|
other factors discussed elsewhere herein and in other reports (including the Form 10-K) filed by
the Company
from time to time with the SEC.
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Operating Revenues:
|
|
|
|
|
|
||||||
Wholesale revenues, non-affiliates
|
$
|
1,146
|
|
|
$
|
964
|
|
|
$
|
1,116
|
|
Wholesale revenues, affiliates
|
419
|
|
|
417
|
|
|
383
|
|
|||
Other revenues
|
12
|
|
|
9
|
|
|
2
|
|
|||
Total operating revenues
|
1,577
|
|
|
1,390
|
|
|
1,501
|
|
|||
Operating Expenses:
|
|
|
|
|
|
||||||
Fuel
|
456
|
|
|
441
|
|
|
596
|
|
|||
Purchased power, non-affiliates
|
81
|
|
|
72
|
|
|
105
|
|
|||
Purchased power, affiliates
|
21
|
|
|
21
|
|
|
66
|
|
|||
Other operations and maintenance
|
354
|
|
|
260
|
|
|
237
|
|
|||
Depreciation and amortization
|
352
|
|
|
248
|
|
|
220
|
|
|||
Taxes other than income taxes
|
23
|
|
|
22
|
|
|
22
|
|
|||
Total operating expenses
|
1,287
|
|
|
1,064
|
|
|
1,246
|
|
|||
Operating Income
|
290
|
|
|
326
|
|
|
255
|
|
|||
Other Income and (Expense):
|
|
|
|
|
|
||||||
Interest expense, net of amounts capitalized
|
(117
|
)
|
|
(77
|
)
|
|
(89
|
)
|
|||
Other income (expense), net
|
6
|
|
|
1
|
|
|
6
|
|
|||
Total other income and (expense)
|
(111
|
)
|
|
(76
|
)
|
|
(83
|
)
|
|||
Earnings Before Income Taxes
|
179
|
|
|
250
|
|
|
172
|
|
|||
Income taxes (benefit)
|
(195
|
)
|
|
21
|
|
|
(3
|
)
|
|||
Net Income
|
374
|
|
|
229
|
|
|
175
|
|
|||
Less: Net income attributable to noncontrolling interests
|
36
|
|
|
14
|
|
|
3
|
|
|||
Net Income Attributable to the Company
|
$
|
338
|
|
|
$
|
215
|
|
|
$
|
172
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Net Income
|
$
|
374
|
|
|
$
|
229
|
|
|
$
|
175
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Qualifying hedges:
|
|
|
|
|
|
||||||
Changes in fair value, net of tax of $(17), $-, and $-, respectively
|
(27
|
)
|
|
—
|
|
|
—
|
|
|||
Reclassification adjustment for amounts included in net income,
net of tax of $36, $-, and $-, respectively |
58
|
|
|
1
|
|
|
—
|
|
|||
Total other comprehensive income
|
31
|
|
|
1
|
|
|
—
|
|
|||
Less: Comprehensive income attributable to noncontrolling interests
|
36
|
|
|
14
|
|
|
3
|
|
|||
Comprehensive Income Attributable to the Company
|
$
|
369
|
|
|
$
|
216
|
|
|
$
|
172
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
|
(in millions)
|
||||||||||
Operating Activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
374
|
|
|
$
|
229
|
|
|
$
|
175
|
|
Adjustments to reconcile net income
to net cash provided from operating activities — |
|
|
|
|
|
||||||
Depreciation and amortization, total
|
370
|
|
|
254
|
|
|
225
|
|
|||
Deferred income taxes
|
(1,063
|
)
|
|
42
|
|
|
(168
|
)
|
|||
Investment tax credits
|
—
|
|
|
162
|
|
|
74
|
|
|||
Amortization of investment tax credits
|
(37
|
)
|
|
(19
|
)
|
|
(11
|
)
|
|||
Collateral deposits
|
(102
|
)
|
|
—
|
|
|
—
|
|
|||
Accrued income taxes, non-current
|
(109
|
)
|
|
109
|
|
|
—
|
|
|||
Other, net
|
—
|
|
|
(2
|
)
|
|
(10
|
)
|
|||
Changes in certain current assets and liabilities —
|
|
|
|
|
|
||||||
-Receivables
|
(54
|
)
|
|
18
|
|
|
(26
|
)
|
|||
-Prepaid income taxes
|
(29
|
)
|
|
(26
|
)
|
|
35
|
|
|||
-Other current assets
|
4
|
|
|
(4
|
)
|
|
(8
|
)
|
|||
-Accounts payable
|
27
|
|
|
(19
|
)
|
|
30
|
|
|||
-Accrued taxes
|
940
|
|
|
269
|
|
|
284
|
|
|||
-Other current liabilities
|
18
|
|
|
(10
|
)
|
|
3
|
|
|||
Net cash provided from operating activities
|
339
|
|
|
1,003
|
|
|
603
|
|
|||
Investing Activities:
|
|
|
|
|
|
||||||
Business acquisitions
|
(2,294
|
)
|
|
(1,719
|
)
|
|
(731
|
)
|
|||
Property additions
|
(2,114
|
)
|
|
(1,005
|
)
|
|
(21
|
)
|
|||
Change in construction payables
|
(57
|
)
|
|
251
|
|
|
—
|
|
|||
Investment in restricted cash
|
(733
|
)
|
|
(159
|
)
|
|
—
|
|
|||
Distribution of restricted cash
|
736
|
|
|
154
|
|
|
—
|
|
|||
Payments pursuant to LTSA and for equipment not yet received
|
(350
|
)
|
|
(82
|
)
|
|
(61
|
)
|
|||
Other investing activities
|
15
|
|
|
22
|
|
|
(1
|
)
|
|||
Net cash used for investing activities
|
(4,797
|
)
|
|
(2,538
|
)
|
|
(814
|
)
|
|||
Financing Activities:
|
|
|
|
|
|
||||||
Increase (decrease) in notes payable, net
|
73
|
|
|
(58
|
)
|
|
195
|
|
|||
Proceeds —
|
|
|
|
|
|
||||||
Capital contributions
|
1,850
|
|
|
646
|
|
|
146
|
|
|||
Senior notes
|
2,831
|
|
|
1,650
|
|
|
—
|
|
|||
Other long-term debt
|
65
|
|
|
402
|
|
|
10
|
|
|||
Redemptions —
|
|
|
|
|
|
||||||
Senior notes
|
(200
|
)
|
|
(525
|
)
|
|
—
|
|
|||
Other long-term debt
|
(86
|
)
|
|
(4
|
)
|
|
(10
|
)
|
|||
Distributions to noncontrolling interests
|
(57
|
)
|
|
(18
|
)
|
|
(1
|
)
|
|||
Capital contributions from noncontrolling interests
|
682
|
|
|
341
|
|
|
8
|
|
|||
Purchase of membership interests from noncontrolling interests
|
(129
|
)
|
|
—
|
|
|
—
|
|
|||
Payment of common stock dividends
|
(272
|
)
|
|
(131
|
)
|
|
(131
|
)
|
|||
Other financing activities
|
(30
|
)
|
|
(13
|
)
|
|
—
|
|
|||
Net cash provided from financing activities
|
4,727
|
|
|
2,290
|
|
|
217
|
|
|||
Net Change in Cash and Cash Equivalents
|
269
|
|
|
755
|
|
|
6
|
|
|||
Cash and Cash Equivalents at Beginning of Year
|
830
|
|
|
75
|
|
|
69
|
|
|||
Cash and Cash Equivalents at End of Year
|
$
|
1,099
|
|
|
$
|
830
|
|
|
$
|
75
|
|
Supplemental Cash Flow Information:
|
|
|
|
|
|
||||||
Cash paid (received) during the period for —
|
|
|
|
|
|
||||||
Interest (net of $44, $14, and $- capitalized, respectively)
|
$
|
89
|
|
|
$
|
74
|
|
|
$
|
85
|
|
Income taxes (net of refunds and investment tax credits)
|
116
|
|
|
(518
|
)
|
|
(220
|
)
|
|||
Noncash transactions —
|
|
|
|
|
|
||||||
Accrued property additions at year-end
|
251
|
|
|
257
|
|
|
1
|
|
|||
Acquisitions
|
461
|
|
|
—
|
|
|
229
|
|
|||
Capital contributions from noncontrolling interests
|
—
|
|
|
—
|
|
|
221
|
|
Assets
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,099
|
|
|
$
|
830
|
|
Receivables —
|
|
|
|
||||
Customer accounts receivable
|
102
|
|
|
75
|
|
||
Other accounts receivable
|
34
|
|
|
19
|
|
||
Affiliated
|
57
|
|
|
30
|
|
||
Fossil fuel stock
|
15
|
|
|
16
|
|
||
Materials and supplies
|
337
|
|
|
63
|
|
||
Prepaid income taxes
|
74
|
|
|
45
|
|
||
Other current assets
|
39
|
|
|
30
|
|
||
Total current assets
|
1,757
|
|
|
1,108
|
|
||
Property, Plant, and Equipment:
|
|
|
|
||||
In service
|
12,728
|
|
|
7,275
|
|
||
Less accumulated provision for depreciation
|
1,484
|
|
|
1,248
|
|
||
Plant in service, net of depreciation
|
11,244
|
|
|
6,027
|
|
||
Construction work in progress
|
398
|
|
|
1,137
|
|
||
Total property, plant, and equipment
|
11,642
|
|
|
7,164
|
|
||
Other Property and Investments:
|
|
|
|
||||
Intangible assets, net of amortization of $22 and $12
at December 31, 2016 and December 31, 2015, respectively |
436
|
|
|
319
|
|
||
Total other property and investments
|
436
|
|
|
319
|
|
||
Deferred Charges and Other Assets:
|
|
|
|
||||
Prepaid long-term service agreements
|
101
|
|
|
166
|
|
||
Accumulated deferred income taxes
|
594
|
|
|
—
|
|
||
Other deferred charges and assets — affiliated
|
13
|
|
|
9
|
|
||
Other deferred charges and assets — non-affiliated
|
626
|
|
|
139
|
|
||
Total deferred charges and other assets
|
1,334
|
|
|
314
|
|
||
Total Assets
|
$
|
15,169
|
|
|
$
|
8,905
|
|
Liabilities and Stockholders' Equity
|
2016
|
|
|
2015
|
|
||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
||||
Securities due within one year
|
$
|
560
|
|
|
$
|
403
|
|
Notes payable
|
209
|
|
|
137
|
|
||
Accounts payable —
|
|
|
|
||||
Affiliated
|
88
|
|
|
66
|
|
||
Other
|
278
|
|
|
327
|
|
||
Accrued taxes —
|
|
|
|
||||
Accrued income taxes
|
148
|
|
|
198
|
|
||
Other accrued taxes
|
7
|
|
|
5
|
|
||
Accrued interest
|
36
|
|
|
23
|
|
||
Acquisitions payable
|
461
|
|
|
—
|
|
||
Contingent consideration
|
46
|
|
|
36
|
|
||
Other current liabilities
|
70
|
|
|
44
|
|
||
Total current liabilities
|
1,903
|
|
|
1,239
|
|
||
Long-Term Debt:
|
|
|
|
||||
Senior notes —
|
|
|
|
||||
1.85% due 2017
|
—
|
|
|
500
|
|
||
1.50% due 2018
|
350
|
|
|
350
|
|
||
1.95% due 2019
|
600
|
|
|
—
|
|
||
2.375% due 2020
|
300
|
|
|
300
|
|
||
2.50% due 2021
|
300
|
|
|
—
|
|
||
1.00% to 6.375% due 2022-2046
|
3,224
|
|
|
1,575
|
|
||
Other long-term debt —
|
|
|
|
||||
Variable rate (1.88% at 1/1/17) due 2018
|
320
|
|
|
—
|
|
||
Variable rate (3.75% at 1/1/17) due 2032-2036
|
15
|
|
|
13
|
|
||
Unamortized debt premium (discount), net
|
(12
|
)
|
|
—
|
|
||
Unamortized debt issuance expense
|
(29
|
)
|
|
(19
|
)
|
||
Long-term debt
|
5,068
|
|
|
2,719
|
|
||
Deferred Credits and Other Liabilities:
|
|
|
|
||||
Accumulated deferred income taxes
|
152
|
|
|
601
|
|
||
Accumulated deferred investment tax credits
|
1,839
|
|
|
889
|
|
||
Accrued income taxes, non-current
|
—
|
|
|
109
|
|
||
Asset retirement obligations
|
64
|
|
|
21
|
|
||
Deferred capacity revenues — affiliated
|
17
|
|
|
17
|
|
||
Other deferred credits and liabilities
|
287
|
|
|
3
|
|
||
Total deferred credits and other liabilities
|
2,359
|
|
|
1,640
|
|
||
Total Liabilities
|
9,330
|
|
|
5,598
|
|
||
Redeemable Noncontrolling Interests
|
164
|
|
|
43
|
|
||
Common Stockholder's Equity:
|
|
|
|
||||
Common stock, par value $0.01 per share —
|
|
|
|
||||
Authorized — 1,000,000 shares
|
|
|
|
||||
Outstanding — 1,000 shares
|
—
|
|
|
—
|
|
||
Paid-in capital
|
3,671
|
|
|
1,822
|
|
||
Retained earnings
|
724
|
|
|
657
|
|
||
Accumulated other comprehensive income
|
35
|
|
|
4
|
|
||
Total common stockholder's equity
|
4,430
|
|
|
2,483
|
|
||
Noncontrolling Interests
|
1,245
|
|
|
781
|
|
||
Total Stockholders' Equity
|
5,675
|
|
|
3,264
|
|
||
Total Liabilities and Stockholders' Equity
|
$
|
15,169
|
|
|
$
|
8,905
|
|
Commitments and Contingent Matters
(See notes)
|
|
|
|
|
Number of Common Shares Issued
|
|
Common Stock
|
|
Paid-In Capital
|
|
Retained Earnings
|
|
|
Accumulated Other Comprehensive Income
|
|
Total Common Stockholder's Equity
|
|
Noncontrolling Interests
(*)
|
|
Total
|
||||||||||||||
|
(in millions)
|
|||||||||||||||||||||||||||||
Balance at December 31, 2013
|
—
|
|
|
$
|
—
|
|
|
$
|
1,029
|
|
|
$
|
532
|
|
|
$
|
3
|
|
|
$
|
1,564
|
|
|
$
|
—
|
|
|
$
|
1,564
|
|
Net income attributable
to Southern Power
|
—
|
|
|
—
|
|
|
—
|
|
|
172
|
|
|
—
|
|
|
172
|
|
|
—
|
|
|
172
|
|
|||||||
Capital contributions from
parent company
|
—
|
|
|
—
|
|
|
147
|
|
|
—
|
|
|
—
|
|
|
147
|
|
|
—
|
|
|
147
|
|
|||||||
Cash dividends on common
stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(131
|
)
|
|
—
|
|
|
(131
|
)
|
|
—
|
|
|
(131
|
)
|
|||||||
Capital contributions from
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
221
|
|
|
221
|
|
|||||||
Net loss attributable to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
|||||||
Balance at December 31, 2014
|
—
|
|
|
—
|
|
|
1,176
|
|
|
573
|
|
|
3
|
|
|
1,752
|
|
|
219
|
|
|
1,971
|
|
|||||||
Net income attributable
to Southern Power
|
—
|
|
|
—
|
|
|
—
|
|
|
215
|
|
|
—
|
|
|
215
|
|
|
—
|
|
|
215
|
|
|||||||
Capital contributions from
parent company
|
—
|
|
|
—
|
|
|
646
|
|
|
—
|
|
|
—
|
|
|
646
|
|
|
—
|
|
|
646
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||||
Cash dividends on common
stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(131
|
)
|
|
—
|
|
|
(131
|
)
|
|
—
|
|
|
(131
|
)
|
|||||||
Capital contributions from
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
567
|
|
|
567
|
|
|||||||
Distributions to noncontrolling
interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|
(17
|
)
|
|||||||
Net income attributable to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
12
|
|
|||||||
Balance at December 31, 2015
|
—
|
|
|
—
|
|
|
1,822
|
|
|
657
|
|
|
4
|
|
|
2,483
|
|
|
781
|
|
|
3,264
|
|
|||||||
Net income attributable
to Southern Power
|
—
|
|
|
—
|
|
|
—
|
|
|
338
|
|
|
—
|
|
|
338
|
|
|
—
|
|
|
338
|
|
|||||||
Capital contributions from
parent company
|
—
|
|
|
—
|
|
|
1,850
|
|
|
—
|
|
|
—
|
|
|
1,850
|
|
|
—
|
|
|
1,850
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
31
|
|
|
31
|
|
|
—
|
|
|
31
|
|
|||||||
Cash dividends on common
stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(272
|
)
|
|
—
|
|
|
(272
|
)
|
|
—
|
|
|
(272
|
)
|
|||||||
Capital contributions from
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
618
|
|
|
618
|
|
|||||||
Distributions to noncontrolling
interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(57
|
)
|
|
(57
|
)
|
|||||||
Purchase of membership interests
from noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(129
|
)
|
|
(129
|
)
|
|||||||
Net income attributable to
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32
|
|
|
32
|
|
|||||||
Other
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
1
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at December 31, 2016
|
—
|
|
|
$
|
—
|
|
|
$
|
3,671
|
|
|
$
|
724
|
|
|
$
|
35
|
|
|
$
|
4,430
|
|
|
$
|
1,245
|
|
|
$
|
5,675
|
|
(*)
|
Excludes redeemable noncontrolling interests. See Note 10 to the financial statements under "Noncontrolling Interests" for additional information.
|
Note
|
|
Page
|
1
|
||
2
|
||
3
|
||
4
|
||
5
|
||
6
|
||
7
|
||
8
|
||
9
|
||
10
|
||
11
|
|
2016
|
|
2015
|
|
2014
|
|||
Georgia Power
|
16.5
|
%
|
|
15.8
|
%
|
|
10.1
|
%
|
Duke Energy Corporation
|
7.8
|
%
|
|
8.2
|
%
|
|
9.1
|
%
|
San Diego Gas & Electric Company
|
5.7
|
%
|
|
6.1
|
%
|
|
2.9
|
%
|
FPL
|
—
|
%
|
|
10.7
|
%
|
|
9.7
|
%
|
Generating facility
|
Useful life
|
Natural gas
|
Up to 45 years
|
Biomass
|
Up to 40 years
|
Solar
|
Up to 35 years
|
Wind
|
Up to 30 years
|
|
2016
|
|
|
2015
|
|
||||
|
(in millions)
|
|
|||||||
Balance at beginning of year
|
$
|
21
|
|
|
|
$
|
13
|
|
|
Liabilities incurred
|
42
|
|
|
|
7
|
|
|
||
Accretion
|
1
|
|
|
|
1
|
|
|
||
Balance at end of year
|
$
|
64
|
|
|
|
$
|
21
|
|
|
|
Amortization
Expense
|
||
|
(in millions)
|
||
2017
|
$
|
25
|
|
2018
|
25
|
|
|
2019
|
25
|
|
|
2020
|
25
|
|
|
2021
|
25
|
|
Project Facility
|
Resource
|
Seller; Acquisition Date
|
Approximate Nameplate Capacity (
MW
)
|
|
Location
|
Percentage Ownership
|
Actual/Expected COD
|
PPA Contract Period
|
||
Acquisitions During the Year Ended December 31, 2016
|
||||||||||
Boulder 1
|
Solar
|
SunPower
November 16, 2016 |
100
|
|
Clark County, NV
|
51
|
%
|
(a)
|
December 2016
|
20 years
|
Calipatria
|
Solar
|
Solar Frontier Americas Holding LLC
February 11, 2016 |
20
|
|
Imperial County, CA
|
90
|
%
|
(b)
|
February 2016
|
20 years
|
East Pecos
|
Solar
|
First Solar, Inc.
March 4, 2016 |
120
|
|
Pecos County, TX
|
100
|
%
|
|
March 2017
|
15 years
|
Grant Plains
|
Wind
|
Apex Clean Energy Holdings, LLC
August 26, 2016 |
147
|
|
Grant County, OK
|
100
|
%
|
|
December 2016
|
20 years and 12 years
(c)
|
Grant Wind
|
Wind
|
Apex Clean Energy Holdings, LLC
April 7, 2016 |
151
|
|
Grant County, OK
|
100
|
%
|
|
April 2016
|
20 years
|
Henrietta
|
Solar
|
SunPower
July 1, 2016 |
102
|
|
Kings County, CA
|
51
|
%
|
(a)
|
July 2016
|
20 years
|
Lamesa
|
Solar
|
RES America Developments Inc.
July 1, 2016 |
102
|
|
Dawson County, TX
|
100
|
%
|
|
Second quarter 2017
|
15 years
|
Mankato
(d)
|
Natural Gas
|
Calpine Corporation October 26, 2016
|
375
|
|
Mankato, MN
|
100
|
%
|
|
N/A
(e)
|
10 years
|
Passadumkeag
|
Wind
|
Quantum Utility Generation, LLC
June 30, 2016 |
42
|
|
Penobscot County, ME
|
100
|
%
|
|
July 2016
|
15 years
|
Rutherford
|
Solar
|
Cypress Creek Renewables, LLC
July 1, 2016 |
74
|
|
Rutherford County, NC
|
90
|
%
|
(b)
|
December 2016
|
15 years
|
Salt Fork
|
Wind
|
EDF Renewable Energy, Inc.
December 1, 2016 |
174
|
|
Donley and Gray Counties, TX
|
100
|
%
|
|
December 2016
|
14 years and 12 years
|
Tyler Bluff
|
Wind
|
EDF Renewable Energy, Inc.
December 21, 2016 |
125
|
|
Cooke County, TX
|
100
|
%
|
|
December 2016
|
12 years
|
Wake Wind
|
Wind
|
Invenergy
October 26, 2016 |
257
|
|
Floyd and Crosby Counties, TX
|
90.1
|
%
|
(f)
|
October 2016
|
12 years
|
Acquisitions Subsequent to December 31, 2016
|
||||||||||
Bethel
|
Wind
|
Invenergy
January 6, 2017 |
276
|
|
Castro County, TX
|
100
|
%
|
|
January 2017
|
12 years
|
(a)
|
The Company owns
100%
of the class A membership interests and a wholly-owned subsidiary of the seller owns
100%
of the class B membership interests. The Company and the class B member are entitled to
51%
and
49%
, respectively, of all cash distributions from the project. In addition, the Company is entitled to substantially all of the federal tax benefits with respect to the transaction.
|
(b)
|
The Company owns
90%
, with the minority owner, TRE, owning
10%
.
|
(c)
|
In addition to the
20
-year and
12
-year PPAs, the facility has a
10
-year contract with Allianz Risk Transfer (Bermuda) Ltd.
|
(d)
|
Under the terms of the remaining
10
-year PPA and the
20
-year expansion PPA, approximately
$408 million
of assets, primarily related to property, plant, and equipment, are subject to lien at December 31, 2016.
|
(e)
|
The acquisition included a fully operational
375
-MW natural gas-fired combined-cycle facility.
|
(f)
|
The Company owns
90.1%
, with the minority owner, Invenergy, owning
9.9%
.
|
|
2016
|
||
|
(in millions)
|
||
CWIP
|
$
|
2,354
|
|
Property, plant, and equipment
|
302
|
|
|
Intangible assets
(a)
|
128
|
|
|
Other assets
|
52
|
|
|
Accounts payable
|
(16
|
)
|
|
Debt
|
(217
|
)
|
|
Total purchase price
|
$
|
2,603
|
|
|
|
||
Funded by:
|
|
||
The Company
(b) (c)
|
$
|
2,345
|
|
Noncontrolling interests
(d) (e)
|
258
|
|
|
Total purchase price
|
$
|
2,603
|
|
(a)
|
Intangible assets consist of acquired PPAs that will be amortized over
10
and
20
-year terms. The estimated amortization for future periods is approximately
$9 million
per year. See Note 1 for additional information.
|
(b)
|
At
December 31, 2016
,
$461 million
is included in acquisitions payable on the consolidated balance sheets.
|
(c)
|
Includes approximately
$281 million
of contingent consideration, of which
$67 million
remains payable at December 31, 2016.
|
(d)
|
Includes approximately
$51 million
of non-cash contributions recorded as capital contributions from noncontrolling interests in the consolidated statements of stockholders' equity.
|
(e)
|
Includes approximately
$142 million
of contingent consideration, all of which had been paid at December 31, 2016 by the noncontrolling interests.
|
|
2016
|
2015
|
||||
|
(in millions)
|
|||||
Revenues
|
$
|
40
|
|
$
|
39
|
|
Net income
|
$
|
14
|
|
$
|
11
|
|
Project Facility
|
Resource
|
Seller; Acquisition Date
|
Approximate
Nameplate Capacity ( MW ) |
|
Location
|
Percentage Ownership
|
Actual COD
|
PPA
Contract Period |
||
Acquisitions for the Year Ended December 31, 2015
|
||||||||||
Desert Stateline
|
Solar
|
First Solar
August 31, 2015 |
299
(a)
|
|
San Bernardino County, CA
|
51
|
%
|
(b)
|
From December 2015 to July 2016
|
20 years
|
Garland and Garland A
|
Solar
|
Recurrent
December 17, 2015 |
205
|
|
Kern County, CA
|
51
|
%
|
(b)
|
October and August 2016
|
15 years and 20 years
|
Kay Wind
|
Wind
|
Apex Clean Energy Holdings, LLC December 11, 2015
|
299
|
|
Kay County, OK
|
100
|
%
|
|
December 2015
|
20 years
|
Lost Hills Blackwell
|
Solar
|
First Solar
April 15, 2015 |
33
|
|
Kern County, CA
|
51
|
%
|
(b)
|
April 2015
|
29 years
|
Morelos
|
Solar
|
Solar Frontier Americas Holding, LLC
October 22, 2015 |
15
|
|
Kern County, CA
|
90
|
%
|
(c)
|
November 2015
|
20 years
|
North Star
|
Solar
|
First Solar
April 30, 2015 |
61
|
|
Fresno County, CA
|
51
|
%
|
(b)
|
June 2015
|
20 years
|
Roserock
|
Solar
|
Recurrent November 23, 2015
|
160
|
|
Pecos County, TX
|
51
|
%
|
(b)
|
November 2016
|
20 years
|
Tranquillity
|
Solar
|
Recurrent
August 28, 2015 |
205
|
|
Fresno County, CA
|
51
|
%
|
(b)
|
July 2016
|
18 years
|
(a)
|
The facility has a total of
299
MWs, of which
110
MWs were placed in service in the fourth quarter 2015 and the remainder by July 2016.
|
(b)
|
The Company owns
100%
of the class A membership interests and a wholly-owned subsidiary of the seller owns
100%
of the class B membership interests. The Company and the class B member are entitled to
51%
and
49%
, respectively, of all cash distributions from the project. In addition, the Company is entitled to substantially all of the federal tax benefits with respect to the transaction.
|
(c)
|
The Company owns
90%
, with the minority owner, TRE, owning
10%
.
|
|
2015
|
||
|
(in millions)
|
||
CWIP
|
$
|
1,367
|
|
Property, plant, and equipment
|
315
|
|
|
Intangible assets
(a)
|
274
|
|
|
Other assets
|
64
|
|
|
Accounts payable
|
(89
|
)
|
|
Total purchase price
|
$
|
1,931
|
|
|
|
||
Funded by:
|
|
||
The Company
(b)
|
$
|
1,440
|
|
Noncontrolling interests
(c) (d)
|
491
|
|
|
Total purchase price
|
$
|
1,931
|
|
(a)
|
Intangible assets consist of acquired PPAs that will be amortized over
20
-year terms. The estimated amortization for future periods is approximately
$14 million
per year. See Note 1 under "Impairment of Long-Lived Assets and Intangibles" for additional information.
|
(b)
|
Includes approximately
$195 million
of contingent consideration, all of which had been paid at
December 31, 2016
.
|
(c)
|
Includes approximately
$227 million
of non-cash contributions recorded as capital contributions from noncontrolling interests in the consolidated statements of stockholders' equity.
|
(d)
|
Includes approximately
$76 million
of contingent consideration, all of which had been paid at December 31, 2016 by the noncontrolling interests.
|
Solar Facility
|
Seller
|
Approximate Nameplate Capacity (
MW
)
|
Location
|
Actual COD
|
PPA Contract Period
|
Butler
|
CERSM, LLC and Community Energy, Inc.
|
103
|
Taylor County, GA
|
December 2016
|
30 years
(a)
|
Butler Solar Farm
|
Strata Solar Development, LLC
|
22
|
Taylor County, GA
|
February 2016
|
20 years
(a)
|
Desert Stateline
|
First Solar Development, LLC
|
299
(b)
|
San Bernardino County, CA
|
From December 2015 to July 2016
|
20 years
|
Garland
|
Recurrent
|
185
|
Kern County, CA
|
October 2016
|
15 years
|
Garland A
|
Recurrent
|
20
|
Kern County, CA
|
August 2016
|
20 years
|
Pawpaw
|
Longview Solar, LLC
|
30
|
Taylor County, GA
|
March 2016
|
30 years
|
Roserock
(c)
|
Recurrent
|
160
|
Pecos County, TX
|
November 2016
|
20 years
|
Sandhills
|
N/A
|
146
|
Taylor County, GA
|
October 2016
|
25 years
|
Tranquillity
|
Recurrent
|
205
|
Fresno County, CA
|
July 2016
|
18 years
|
(a)
|
Affiliate PPA approved by the FERC.
|
(b)
|
The facility has a total of
299
MWs, of which
110
MWs were placed in service in the fourth quarter 2015 and the remainder by July 2016.
|
(c)
|
Prior to placing the Roserock facility in service, certain solar panels were damaged. While the facility is currently generating energy as expected, the Company is pursuing remedies under its insurance policies and other contracts to repair or replace these solar panels.
|
Project Facility
|
Resource
|
Approximate Nameplate Capacity (
MW
)
|
Location
|
Actual/Expected COD
|
PPA Contract Period
|
East Pecos
|
Solar
|
120
|
Pecos County, TX
|
March 2017
|
15 years
|
Lamesa
|
Solar
|
102
|
Dawson County, TX
|
Second quarter 2017
|
15 years
|
Mankato
|
Natural Gas
|
345
|
Mankato, MN
|
Second quarter 2019
|
20 years
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Federal —
|
|
|
|
|
|
||||||
Current
(*)
|
$
|
928
|
|
|
$
|
12
|
|
|
$
|
179
|
|
Deferred
(*)
|
(1,098
|
)
|
|
10
|
|
|
(166
|
)
|
|||
|
(170
|
)
|
|
22
|
|
|
13
|
|
|||
State —
|
|
|
|
|
|
||||||
Current
|
(60
|
)
|
|
(32
|
)
|
|
(14
|
)
|
|||
Deferred
|
35
|
|
|
31
|
|
|
(2
|
)
|
|||
|
(25
|
)
|
|
(1
|
)
|
|
(16
|
)
|
|||
Total
|
$
|
(195
|
)
|
|
$
|
21
|
|
|
$
|
(3
|
)
|
(*)
|
ITCs and PTCs generated in the current tax year and carried forward from prior tax years that cannot be utilized in the current tax year are reclassified from current to deferred taxes in federal income tax expense above. ITCs and PTCs reclassified in this manner include
$1.13 billion
for
2016
,
$246 million
for
2015
, and
$305 million
for 2014. These ITCs and PTCs are included in the following table of temporary differences as unrealized tax credits.
|
|
2016
|
2015
|
||||
|
|
|||||
Deferred tax liabilities —
|
|
|
||||
Accelerated depreciation and other property basis differences
|
$
|
2,440
|
|
$
|
1,364
|
|
Levelized capacity revenues
|
28
|
|
22
|
|
||
Other
|
27
|
|
7
|
|
||
Total deferred income tax liabilities
|
2,495
|
|
1,393
|
|
||
Deferred tax assets —
|
|
|
||||
Federal effect of state deferred taxes
|
53
|
|
40
|
|
||
Basis difference on ITCs
|
292
|
|
149
|
|
||
Alternative minimum tax carryforward
|
15
|
|
15
|
|
||
Unrealized tax credits
|
1,685
|
|
551
|
|
||
Federal net operating loss (NOL)
|
808
|
|
9
|
|
||
Deferred state tax assets
|
60
|
|
13
|
|
||
Other partnership basis differences
|
16
|
|
3
|
|
||
Other
|
8
|
|
14
|
|
||
Total deferred income tax assets
|
2,937
|
|
794
|
|
||
Valuation Allowance
|
—
|
|
(2
|
)
|
||
Net deferred income tax assets
|
2,937
|
|
792
|
|
||
Total deferred income tax asset (liability)
|
$
|
442
|
|
$
|
(601
|
)
|
|
|
|
||||
Recognized in the consolidated balance sheets:
|
|
|
||||
Accumulated deferred income taxes – assets
|
$
|
594
|
|
$
|
—
|
|
Accumulated deferred income taxes – liability
|
$
|
(152
|
)
|
$
|
(601
|
)
|
Jurisdiction
|
NOL Carryforwards
|
Net State Income Tax Benefit
|
Tax Year NOL Expires
|
||||
|
(in millions)
|
|
|||||
Oklahoma
|
$
|
838
|
|
$
|
32
|
|
2035
|
Florida
|
185
|
|
7
|
|
2033
|
||
Other states
|
7
|
|
1
|
|
2029 through 2035
|
||
Balance at year end
|
$
|
1,030
|
|
$
|
40
|
|
|
|
2016
|
|
2015
|
|
2014
|
|||
Federal statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income tax, net of federal deduction
|
(9.1
|
)
|
|
(0.3
|
)
|
|
(6.0
|
)
|
Amortization of ITC
|
(20.6
|
)
|
|
(5.0
|
)
|
|
(4.3
|
)
|
ITC basis difference
|
(89.0
|
)
|
|
(21.5
|
)
|
|
(27.7
|
)
|
Production tax credits
|
(23.3
|
)
|
|
(0.6
|
)
|
|
—
|
|
Noncontrolling interests
|
(6.2
|
)
|
|
(1.7
|
)
|
|
(0.3
|
)
|
Other
|
4.6
|
|
|
2.5
|
|
|
1.4
|
|
Effective income tax rate (benefit)
|
(108.6
|
)%
|
|
8.4
|
%
|
|
(1.9
|
)%
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Balance at beginning of year
|
$
|
8
|
|
|
$
|
5
|
|
|
$
|
2
|
|
Tax positions increase from current periods
|
17
|
|
|
9
|
|
|
5
|
|
|||
Tax positions decrease from prior periods
|
(8
|
)
|
|
(6
|
)
|
|
(2
|
)
|
|||
Balance at end of year
|
$
|
17
|
|
|
$
|
8
|
|
|
$
|
5
|
|
|
December 31, 2016
|
||
|
(in millions)
|
||
2017
|
$
|
561
|
|
2018
|
670
|
|
|
2019
|
600
|
|
|
2020
|
300
|
|
|
2021
|
300
|
|
Project
|
|
|
Construction Loan Facility
|
|
Bridge Loan Facility
|
|
Total Loan Facility
|
|
Loan Facility Undrawn
|
|
Letter of Credit Facility
|
|
Letter of Credit Facility Undrawn
|
||||||||||||
|
|
|
(in millions)
|
||||||||||||||||||||||
Roserock
|
|
|
$
|
63
|
|
|
$
|
180
|
|
|
$
|
243
|
|
|
$
|
34
|
|
|
$
|
23
|
|
|
$
|
16
|
|
•
|
Level 1 consists of observable market data in an active market for identical assets or liabilities.
|
•
|
Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.
|
•
|
Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
|
||||||||
As of December 31, 2016:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
21
|
|
|
$
|
—
|
|
|
$
|
21
|
|
Interest rate derivatives
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
Cash equivalents
|
628
|
|
|
—
|
|
|
—
|
|
|
628
|
|
||||
Total
|
$
|
628
|
|
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
650
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
5
|
|
Foreign currency derivatives
|
—
|
|
|
58
|
|
|
—
|
|
|
58
|
|
||||
Contingent consideration
|
—
|
|
|
—
|
|
|
18
|
|
|
18
|
|
||||
Total
|
$
|
—
|
|
|
$
|
63
|
|
|
$
|
18
|
|
|
$
|
81
|
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
|
||||||||
As of December 31, 2015:
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Interest rate derivatives
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
||||
Cash equivalents
|
511
|
|
|
—
|
|
|
—
|
|
|
511
|
|
||||
Total
|
$
|
511
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
518
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Energy-related derivatives
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
Carrying
Amount
|
|
Fair
Value
|
||||
|
(in millions)
|
||||||
Long-term debt, including securities due within one year:
|
|
|
|
||||
2016
|
$
|
5,628
|
|
|
$
|
5,691
|
|
2015
|
$
|
3,122
|
|
|
$
|
3,117
|
|
•
|
Cash Flow Hedges
– Gains and losses on energy-related derivatives designated as cash flow hedges which are used to hedge anticipated purchases and sales and are initially deferred in OCI before being recognized in the consolidated statements of income in the same period as the hedged transactions are reflected in earnings.
|
•
|
Not Designated
– Gains and losses on energy-related derivative contracts that are not designated or fail to qualify as hedges are recognized in the consolidated statements of income as incurred.
|
|
Notional
Amount |
|
Interest
Rate Received |
|
Weighted Average Interest
Rate Paid |
|
Hedge
Maturity Date |
|
Fair Value
Gain (Loss) December 31, 2016 |
||||
|
(in millions)
|
|
|
|
|
|
|
|
(in millions)
|
||||
Derivatives not Designated as Hedges
|
$
|
47
|
|
(a.b)
|
3-month LIBOR
|
|
2.21%
|
|
January 2017
|
(c)
|
$
|
1
|
|
(a)
|
Swaption at RE Roserock LLC.
|
(b)
|
Amortizing notional amount.
|
(c)
|
Represents the mandatory settlement date. Settlement amount was based on a
15
-year amortizing swap.
|
|
Pay Notional
|
Pay Rate
|
Receive Notional
|
Receive Rate
|
Hedge
Maturity Date |
Fair Value
Gain (Loss) at December 31, 2016 |
||||||
|
(in millions)
|
|
(in millions)
|
|
|
(in millions)
|
||||||
Cash Flow Hedges of Existing Debt
|
|
|
|
|
|
|||||||
|
$
|
677
|
|
2.95%
|
€
|
600
|
|
1.00%
|
June 2022
|
$
|
(34
|
)
|
|
564
|
|
3.78%
|
500
|
|
1.85%
|
June 2026
|
(24
|
)
|
|||
Total
|
$
|
1,241
|
|
|
€
|
1,100
|
|
|
|
$
|
(58
|
)
|
|
2016
|
|
2015
|
||||||||||
Derivative Category and Balance Sheet Location
|
Assets
|
Liabilities
|
|
Assets
|
Liabilities
|
||||||||
|
(in millions)
|
||||||||||||
Derivatives designated as hedging instruments in cash flow and fair value hedges
|
|
|
|
|
|
||||||||
Energy-related derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
$
|
18
|
|
$
|
4
|
|
|
$
|
3
|
|
$
|
2
|
|
Foreign currency derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
—
|
|
25
|
|
|
—
|
|
—
|
|
||||
Other deferred charges and assets/Other deferred credits and liabilities
|
—
|
|
33
|
|
|
—
|
|
—
|
|
||||
Total derivatives designated as hedging instruments in cash flow and fair value hedges
|
$
|
18
|
|
$
|
62
|
|
|
$
|
3
|
|
$
|
2
|
|
Derivatives not designated as hedging instruments
|
|
|
|
|
|
||||||||
Energy-related derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
$
|
3
|
|
$
|
1
|
|
|
$
|
1
|
|
$
|
1
|
|
Interest rate derivatives:
|
|
|
|
|
|
||||||||
Other current assets/Other current liabilities
|
1
|
|
—
|
|
|
3
|
|
—
|
|
||||
Total derivatives not designated as hedging instruments
|
$
|
4
|
|
$
|
1
|
|
|
$
|
4
|
|
$
|
1
|
|
Gross amounts of recognized assets and liabilities
|
$
|
22
|
|
$
|
63
|
|
|
$
|
7
|
|
$
|
3
|
|
Gross amounts offset
|
$
|
(5
|
)
|
$
|
(5
|
)
|
|
$
|
(1
|
)
|
$
|
(1
|
)
|
Net amounts of assets and liabilities
(*)
|
$
|
17
|
|
$
|
58
|
|
|
$
|
6
|
|
$
|
2
|
|
(*)
|
At December 31, 2015, the fair value amounts for derivative contracts subject to netting arrangements were presented gross on the consolidated balance sheet.
|
Derivatives in Cash Flow Hedging Relationships
|
Gain (Loss) Recognized in OCI on Derivative
(Effective Portion)
|
|
Gain (Loss) Reclassified from AOCI into Income
(Effective Portion)
|
|||||||||||||||||
Derivative Category
|
2016
|
2015
|
2014
|
|
Statements of Income Location
|
2016
|
2015
|
2014
|
||||||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||||||
Energy-related derivatives
|
$
|
14
|
|
$
|
—
|
|
$
|
—
|
|
|
Amortization
|
$
|
2
|
|
$
|
—
|
|
$
|
—
|
|
Interest rate derivatives
|
—
|
|
—
|
|
—
|
|
|
Interest expense, net of amounts capitalized
|
(1
|
)
|
(1
|
)
|
(1
|
)
|
||||||
Foreign currency derivatives
|
(58
|
)
|
—
|
|
—
|
|
|
Interest expense, net of amounts capitalized
|
(13
|
)
|
—
|
|
—
|
|
||||||
|
|
|
|
|
Other income (expense), net
|
(82
|
)
|
—
|
|
—
|
|
|||||||||
Total
|
$
|
(44
|
)
|
$
|
—
|
|
$
|
—
|
|
|
|
$
|
(94
|
)
|
$
|
(1
|
)
|
$
|
(1
|
)
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
|
(in millions)
|
|
|
||||||
Beginning balance
|
$
|
43
|
|
|
$
|
39
|
|
|
$
|
29
|
|
Net income attributable to redeemable noncontrolling interests
|
4
|
|
|
2
|
|
|
4
|
|
|||
Distributions to redeemable noncontrolling interests
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||
Capital contributions from redeemable noncontrolling interests
|
118
|
|
|
2
|
|
|
7
|
|
|||
Ending balance
|
$
|
164
|
|
|
$
|
43
|
|
|
$
|
39
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
(in millions)
|
||||||||||
Net income
|
$
|
374
|
|
|
$
|
229
|
|
|
$
|
175
|
|
Less: Net income (loss) attributable to noncontrolling interests
|
32
|
|
|
12
|
|
|
(1
|
)
|
|||
Less: Net income attributable to redeemable noncontrolling interests
|
4
|
|
|
2
|
|
|
4
|
|
|||
Net income attributable to the Company
|
$
|
338
|
|
|
$
|
215
|
|
|
$
|
172
|
|
Quarter Ended
|
Operating
Revenues
|
|
Operating
Income
|
|
Net Income
Attributable to
the Company
|
||||||
|
(in millions)
|
||||||||||
March 2016
|
$
|
315
|
|
|
$
|
47
|
|
|
$
|
50
|
|
June 2016
|
373
|
|
|
81
|
|
|
89
|
|
|||
September 2016
|
500
|
|
|
134
|
|
|
176
|
|
|||
December 2016
|
389
|
|
|
28
|
|
|
23
|
|
|||
|
|
|
|
|
|
||||||
March 2015
|
$
|
348
|
|
|
$
|
67
|
|
|
$
|
33
|
|
June 2015
|
337
|
|
|
75
|
|
|
46
|
|
|||
September 2015
|
401
|
|
|
129
|
|
|
102
|
|
|||
December 2015
|
304
|
|
|
55
|
|
|
34
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Operating Revenues (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Wholesale — non-affiliates
|
$
|
1,146
|
|
|
$
|
964
|
|
|
$
|
1,116
|
|
|
$
|
923
|
|
|
$
|
754
|
|
Wholesale — affiliates
|
419
|
|
|
417
|
|
|
383
|
|
|
346
|
|
|
425
|
|
|||||
Total revenues from sales of electricity
|
1,565
|
|
|
1,381
|
|
|
1,499
|
|
|
1,269
|
|
|
1,179
|
|
|||||
Other revenues
|
12
|
|
|
9
|
|
|
2
|
|
|
6
|
|
|
7
|
|
|||||
Total
|
$
|
1,577
|
|
|
$
|
1,390
|
|
|
$
|
1,501
|
|
|
$
|
1,275
|
|
|
$
|
1,186
|
|
Net Income Attributable to
Southern Power (in millions)
|
$
|
338
|
|
|
$
|
215
|
|
|
$
|
172
|
|
|
$
|
166
|
|
|
$
|
175
|
|
Cash Dividends
on Common Stock (in millions)
|
$
|
272
|
|
|
$
|
131
|
|
|
$
|
131
|
|
|
$
|
129
|
|
|
$
|
127
|
|
Return on Average Common Equity (percent)
|
9.79
|
|
|
10.16
|
|
|
10.39
|
|
|
10.73
|
|
|
11.72
|
|
|||||
Total Assets (in millions)
(a)(b)
|
$
|
15,169
|
|
|
$
|
8,905
|
|
|
$
|
5,233
|
|
|
$
|
4,417
|
|
|
$
|
3,771
|
|
Property, Plant, and Equipment
—
In Service (in millions)
|
$
|
12,728
|
|
|
$
|
7,275
|
|
|
$
|
5,657
|
|
|
$
|
4,696
|
|
|
$
|
4,060
|
|
Capitalization (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
$
|
4,430
|
|
|
$
|
2,483
|
|
|
$
|
1,752
|
|
|
$
|
1,564
|
|
|
$
|
1,522
|
|
Redeemable noncontrolling interests
|
164
|
|
|
43
|
|
|
39
|
|
|
29
|
|
|
8
|
|
|||||
Noncontrolling interests
|
1,245
|
|
|
781
|
|
|
219
|
|
|
—
|
|
|
—
|
|
|||||
Long-term debt
(a)
|
5,068
|
|
|
2,719
|
|
|
1,085
|
|
|
1,607
|
|
|
1,297
|
|
|||||
Total (excluding amounts due within one year)
|
$
|
10,907
|
|
|
$
|
6,026
|
|
|
$
|
3,095
|
|
|
$
|
3,200
|
|
|
$
|
2,827
|
|
Capitalization Ratios (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock equity
|
40.6
|
|
|
41.2
|
|
|
56.6
|
|
|
48.9
|
|
|
53.8
|
|
|||||
Redeemable noncontrolling interests
|
1.5
|
|
|
0.7
|
|
|
1.3
|
|
|
0.9
|
|
|
0.3
|
|
|||||
Noncontrolling interests
|
11.4
|
|
|
13.0
|
|
|
7.1
|
|
|
—
|
|
|
—
|
|
|||||
Long-term debt
(a)
|
46.5
|
|
|
45.1
|
|
|
35.0
|
|
|
50.2
|
|
|
45.9
|
|
|||||
Total (excluding amounts due within one year)
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|||||
Kilowatt-Hour Sales (in millions):
|
|
|
|
|
|
|
|
|
|
||||||||||
Wholesale — non-affiliates
|
23,213
|
|
|
18,544
|
|
|
19,014
|
|
|
15,111
|
|
|
15,637
|
|
|||||
Wholesale — affiliates
|
15,950
|
|
|
16,567
|
|
|
11,194
|
|
|
9,359
|
|
|
16,373
|
|
|||||
Total
|
39,163
|
|
|
35,111
|
|
|
30,208
|
|
|
24,470
|
|
|
32,010
|
|
|||||
Plant Nameplate Capacity
Ratings (year-end) (megawatts)
(c)
|
12,442
|
|
|
9,808
|
|
|
9,185
|
|
|
8,924
|
|
|
8,764
|
|
|||||
Maximum Peak-Hour Demand (megawatts):
|
|
|
|
|
|
|
|
|
|
||||||||||
Winter
|
3,469
|
|
|
3,923
|
|
|
3,999
|
|
|
2,685
|
|
|
3,018
|
|
|||||
Summer
|
4,303
|
|
|
4,249
|
|
|
3,998
|
|
|
3,271
|
|
|
3,641
|
|
|||||
Annual Load Factor (percent)
|
50.0
|
|
|
49.0
|
|
|
51.8
|
|
|
54.2
|
|
|
48.6
|
|
|||||
Plant Availability (percent)
|
91.6
|
|
|
93.1
|
|
|
91.8
|
|
|
91.8
|
|
|
92.9
|
|
|||||
Source of Energy Supply (percent):
|
|
|
|
|
|
|
|
|
|
||||||||||
Natural gas
|
79.4
|
|
|
89.5
|
|
|
86.0
|
|
|
88.5
|
|
|
91.0
|
|
|||||
Solar, Wind, and Biomass
|
12.1
|
|
|
4.3
|
|
|
2.9
|
|
|
1.1
|
|
|
0.5
|
|
|||||
Purchased power —
|
|
|
|
|
|
|
|
|
|
||||||||||
From non-affiliates
|
6.8
|
|
|
4.7
|
|
|
6.4
|
|
|
6.4
|
|
|
7.2
|
|
|||||
From affiliates
|
1.7
|
|
|
1.5
|
|
|
4.7
|
|
|
4.0
|
|
|
1.3
|
|
|||||
Total
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
(a)
|
A reclassification of debt issuance costs from Total Assets to Long-term debt of $11 million, $12 million, and $9 million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
(b)
|
A reclassification of deferred tax assets from Total Assets of $306 million, $- million, and $- million is reflected for years 2014, 2013, and 2012, respectively, in accordance with new accounting standards adopted in 2015 and applied retrospectively.
|
(c)
|
Plant nameplate capacity ratings include 100% of all solar facilities. When taking into consideration the Company's 90% equity interest in STR and SRP's various equity interests in its subsidiaries, the Company's equity portion of total nameplate capacity for 2016 is 11,768 MW.
|
Term
|
Meaning
|
AFUDC
|
Allowance for funds used during construction
|
ASC
|
Accounting Standards Codification
|
Atlanta Gas Light
|
Atlanta Gas Light Company
|
Atlantic Coast Pipeline
|
Atlantic Coast Pipeline, LLC
|
Chattanooga Gas
|
Chattanooga Gas Company
|
Chicago Hub
|
A venture of Nicor Gas, which provides natural gas storage and transmission-related services to marketers and gas distribution companies
|
CUB
|
Citizens Utility Board, in Illinois
|
Dalton Pipeline
|
A 50% undivided ownership interest in a pipeline facility in Georgia
|
EPA
|
U.S. Environmental Protection Agency
|
FASB
|
Financial Accounting Standards Board
|
FERC
|
Federal Energy Regulatory Commission
|
Fitch
|
Fitch Ratings, Inc.
|
Florida PSC
|
Florida Public Service Commission, the state regulatory agency for Florida City Gas
|
GAAP
|
U.S. generally accepted accounting principles
|
Georgia PSC
|
Georgia Public Service Commission, the state regulatory agency for Atlanta Gas Light
|
Heating Degree Days
|
A measure of weather, calculated when the average daily temperatures are less than 65 degrees Fahrenheit
|
Heating Season
|
The period from November through March when natural gas usage and operating revenues are generally higher
|
Horizon Pipeline
|
Horizon Pipeline Company, LLC
|
Illinois Commission
|
Illinois Commerce Commission, the state regulatory agency for Nicor Gas
|
IRS
|
Internal Revenue Service
|
ITC
|
Investment tax credit
|
LIFO
|
Last-in, first-out
|
LNG
|
Liquefied natural gas
|
LOCOM
|
Lower of weighted average cost or current market price
|
Marketers
|
Marketers selling retail natural gas in Georgia and certificated by the Georgia PSC
|
Merger
|
The merger of AMS Corp., a wholly-owned, direct subsidiary of Southern Company, with and into Southern Company Gas, effective July 1, 2016, with Southern Company Gas continuing as the surviving corporation and a wholly-owned, direct subsidiary of Southern Company
|
MGP
|
Manufactured gas plant
|
mmBtu
|
Million British thermal units
|
Moody's
|
Moody's Investors Service, Inc.
|
natural gas distribution utilities
|
Southern Company Gas' seven natural gas distribution utilities (Nicor Gas, Atlanta Gas Light, Virginia Natural Gas, Elizabethtown Gas, Florida City Gas, Chattanooga Gas, and Elkton Gas)
|
New Jersey BPU
|
New Jersey Board of Public Utilities, the state regulatory agency for Elizabethtown Gas
|
Nicor
|
Nicor Inc. - former holding company of Nicor Gas
|
Nicor Gas
|
Northern Illinois Gas Company, doing business as Nicor Gas Company
|
Nicor Gas Credit Facility
|
$700 million credit facility entered into by Nicor Gas to support its commercial paper program
|
NYMEX
|
New York Mercantile Exchange, Inc.
|
OCI
|
Other comprehensive income
|
Term
|
Meaning
|
Pad gas
|
Volumes of non-working natural gas used to maintain the operational integrity of the natural gas storage facility
|
PennEast Pipeline
|
PennEast Pipeline Company, LLC
|
Piedmont
|
Piedmont Natural Gas Company, Inc.
|
Pivotal Utility Holdings
|
Pivotal Utility Holdings, Inc., doing business as Elizabethtown Gas, Elkton Gas, and Florida City Gas
|
PRP
|
Pipeline Replacement Program, Atlanta Gas Light's 15-year infrastructure replacement program, which ended in December 2013
|
PSC
|
Public Service Commission
|
ROE
|
Return on equity
|
S&P
|
S&P Global Ratings, a division of S&P Global Inc.
|
SCS
|
Southern Company Services, Inc. (the Southern Company system service company)
|
SEC
|
U.S. Securities and Exchange Commission
|
Sequent
|
Sequent Energy Management, L.P.
|
SNG
|
Southern Natural Gas Company, L.L.C.
|
Southern Company
|
The Southern Company
|
Southern Company Gas Capital
|
Southern Company Gas Capital Corporation (formerly known as AGL Capital Corporation), a 100%-owned subsidiary of Southern Company Gas
|
Southern Company Gas Credit Facility
|
$1.3 billion credit agreement entered into by Southern Company Gas Capital to support its commercial paper program
|
Southern Company system
|
Southern Company, the traditional electric operating companies, Southern Power, Southern Company Gas (as of July 1, 2016), Southern Electric Generating Company, Southern Nuclear, SCS, Southern LINC, PowerSecure, Inc. (as of May 9, 2016), and other subsidiaries
|
Southern LINC
|
Southern Communications Services, Inc.
|
Southern Nuclear
|
Southern Nuclear Operating Company, Inc.
|
Southern Power
|
Southern Power Company and its subsidiaries
|
SouthStar
|
SouthStar Energy Services, LLC
|
STRIDE
|
Atlanta Gas Light's Strategic Infrastructure Development and Enhancement program
|
traditional electric operating companies
|
Alabama Power Company, Georgia Power Company, Gulf Power Company, and Mississippi Power Company
|
Triton
|
Triton Container Investments, LLC
|
Tropical Shipping
|
Tropical Shipping and Construction Company Limited, which was sold in 2014
|
VIE
|
Variable interest entity
|
Virginia Commission
|
Virginia State Corporation Commission, the state regulatory agency for Virginia Natural Gas
|
Virginia Natural Gas
|
Virginia Natural Gas, Inc.
|
WACOG
|
Weighted average cost of gas
|
|
|
Years Ended December 31,
|
|
2016 vs. 2015
|
|
2015 vs. 2014
|
|
2016 vs. normal
|
|||||||||||||
|
|
Normal
(a)
|
|
2016
|
|
2015
|
|
2014
|
|
(warmer)
|
|
(warmer)
|
|
(warmer)
|
|||||||
|
|
(in thousands)
|
|
|
|
|
|
|
|||||||||||||
Illinois
(b)
|
|
5,869
|
|
|
5,243
|
|
|
5,433
|
|
|
6,556
|
|
|
(3
|
)%
|
|
(17
|
)%
|
|
(11
|
)%
|
Georgia
|
|
2,618
|
|
|
2,175
|
|
|
2,204
|
|
|
2,882
|
|
|
(1
|
)%
|
|
(24
|
)%
|
|
(17
|
)%
|
(a)
|
Normal represents the 10-year average from January 1, 2006 through December 31, 2015 for Illinois at Chicago Midway International Airport and for Georgia at Atlanta Hartsfield-Jackson International Airport, based on information obtained from the National Oceanic and Atmospheric Administration, National Climatic Data Center.
|
(b)
|
The 10-year average Heating Degree Days established by the Illinois Commission in Nicor Gas' last rate case is
5,600
for the 12 months from 1999 through 2008.
|
|
|
December 31,
|
|||||||
|
|
2016
(a)
|
|
2015
(b)
|
|
2014
(b)
|
|||
|
|
(in thousands)
|
|||||||
Gas distribution operations
|
|
4,586
|
|
|
4,526
|
|
|
4,497
|
|
Gas marketing services
|
|
|
|
|
|
|
|||
Energy customers
|
|
656
|
|
|
645
|
|
|
628
|
|
Market share of energy customers in Georgia
|
|
29.6
|
%
|
|
29.7
|
%
|
|
30.6
|
%
|
Service contracts
|
|
1,198
|
|
|
1,171
|
|
|
1,182
|
|
(a)
|
Includes customer and contract counts at December 31, 2016.
|
(b)
|
Includes average customer and contract counts for the years ended December 31, 2015 and 2014.
|
|
|
Year Ended December 31,
|
|
2016 vs. 2015
|
|
2015 vs. 2014
|
|||||||||
|
|
2016
|
|
2015
|
|
2014
|
|
% Change
|
|
% Change
|
|||||
Gas distribution operations
(mmBtu in millions)
|
|
|
|
|
|
|
|
|
|
|
|||||
Firm
|
|
670
|
|
|
695
|
|
|
766
|
|
|
(3.6
|
)%
|
|
(9.3
|
)%
|
Interruptible
|
|
96
|
|
|
99
|
|
|
106
|
|
|
(3.0
|
)%
|
|
(6.6
|
)%
|
Total
|
|
766
|
|
|
794
|
|
|
872
|
|
|
(3.5
|
)%
|
|
(8.9
|
)%
|
Gas marketing services
(mmBtu in millions)
|
|
|
|
|
|
|
|
|
|
|
|||||
Firm:
|
|
|
|
|
|
|
|
|
|
|
|||||
Georgia
|
|
34
|
|
|
35
|
|
|
41
|
|
|
(2.9
|
)%
|
|
(14.6
|
)%
|
Illinois
|
|
12
|
|
|
13
|
|
|
17
|
|
|
(7.7
|
)%
|
|
(23.5
|
)%
|
Other emerging markets
|
|
12
|
|
|
11
|
|
|
10
|
|
|
9.1
|
%
|
|
10.0
|
%
|
Interruptible:
|
|
|
|
|
|
|
|
|
|
|
|||||
Large commercial and industrial
|
|
14
|
|
|
14
|
|
|
17
|
|
|
—
|
%
|
|
(17.6
|
)%
|
Total
|
|
72
|
|
|
73
|
|
|
85
|
|
|
(1.4
|
)%
|
|
(14.1
|
)%
|
Wholesale gas services
|
|
|
|
|
|
|
|
|
|
|
|||||
Daily physical sales
(mmBtu in millions/day)
|
|
7.4
|
|
|
6.8
|
|
|
6.3
|
|
|
8.8
|
%
|
|
7.9
|
%
|
|
|
Percent Generated During Heating Season
|
|||||||
|
|
Operating Revenues
|
|
EBIT
|
|
Net Income
|
|||
Successor - July 1, 2016 through December 31, 2016
|
|
67.1
|
%
|
|
81.5
|
%
|
|
96.5
|
%
|
Predecessor - January 1, 2016 through June 30, 2016
|
|
70.0
|
%
|
|
107.0
|
%
|
|
138.9
|
%
|
2015
|
|
68.1
|
%
|
|
77.3
|
%
|
|
85.0
|
%
|
2014
|
|
72.6
|
%
|
|
79.8
|
%
|
|
89.6
|
%
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Operating revenues
|
$
|
1,652
|
|
|
|
$
|
1,905
|
|
|
$
|
3,941
|
|
|
$
|
5,385
|
|
Cost of natural gas
|
613
|
|
|
|
755
|
|
|
1,617
|
|
|
2,729
|
|
||||
Cost of other sales
|
10
|
|
|
|
14
|
|
|
28
|
|
|
36
|
|
||||
Other operations and maintenance
|
482
|
|
|
|
454
|
|
|
928
|
|
|
939
|
|
||||
Depreciation and amortization
|
238
|
|
|
|
206
|
|
|
397
|
|
|
380
|
|
||||
Taxes other than income taxes
|
71
|
|
|
|
99
|
|
|
181
|
|
|
208
|
|
||||
Merger-related expenses
|
41
|
|
|
|
56
|
|
|
44
|
|
|
—
|
|
||||
Total operating expenses
|
1,455
|
|
|
|
1,584
|
|
|
3,195
|
|
|
4,292
|
|
||||
Gain on disposition of assets
|
—
|
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||
Operating income
|
197
|
|
|
|
321
|
|
|
746
|
|
|
1,095
|
|
||||
Interest expense, net of amounts capitalized
|
81
|
|
|
|
96
|
|
|
175
|
|
|
182
|
|
||||
Earnings from equity method investments
|
60
|
|
|
|
2
|
|
|
6
|
|
|
8
|
|
||||
Other income (expense), net
|
14
|
|
|
|
5
|
|
|
9
|
|
|
9
|
|
||||
Earnings before income taxes
|
190
|
|
|
|
232
|
|
|
586
|
|
|
930
|
|
||||
Income taxes
|
76
|
|
|
|
87
|
|
|
213
|
|
|
350
|
|
||||
Income from continuing operations
|
114
|
|
|
|
145
|
|
|
373
|
|
|
580
|
|
||||
Loss from discontinued operations, net of tax
|
—
|
|
|
|
—
|
|
|
—
|
|
|
80
|
|
||||
Net Income
|
114
|
|
|
|
145
|
|
|
373
|
|
|
500
|
|
||||
Less: Net income attributable to noncontrolling interest
|
—
|
|
|
|
14
|
|
|
20
|
|
|
18
|
|
||||
Net Income Attributable to Southern Company Gas
|
$
|
114
|
|
|
|
$
|
131
|
|
|
$
|
353
|
|
|
$
|
482
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Operating Income
|
$
|
197
|
|
|
|
$
|
321
|
|
|
$
|
746
|
|
|
$
|
1,095
|
|
Other operating expenses
(a)
|
832
|
|
|
|
815
|
|
|
1,550
|
|
|
1,527
|
|
||||
Gain on disposition of assets
|
—
|
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||
Revenue tax expense
(b)
|
(31
|
)
|
|
|
(56
|
)
|
|
(101
|
)
|
|
(130
|
)
|
||||
Adjusted Operating Margin
|
$
|
998
|
|
|
|
$
|
1,080
|
|
|
$
|
2,195
|
|
|
$
|
2,490
|
|
(a)
|
Adjusted for the following operating expenses: other operations and maintenance, depreciation and amortization, taxes other than income taxes, and Merger-related expenses.
|
(b)
|
Adjusted for Nicor Gas' revenue tax expenses, which are passed through directly to customers.
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Consolidated Net Income Attributable to Southern Company Gas
|
$
|
114
|
|
|
|
$
|
131
|
|
|
$
|
353
|
|
|
$
|
562
|
|
Net income attributable to noncontrolling interest
|
—
|
|
|
|
14
|
|
|
20
|
|
|
18
|
|
||||
Income taxes
|
76
|
|
|
|
87
|
|
|
213
|
|
|
350
|
|
||||
Interest expense, net of amounts capitalized
|
81
|
|
|
|
96
|
|
|
175
|
|
|
182
|
|
||||
EBIT
|
$
|
271
|
|
|
|
$
|
328
|
|
|
$
|
761
|
|
|
$
|
1,112
|
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||||||||||
|
|
July 1, 2016 through December 31, 2016
|
|
|
January 1, 2016 through June 30, 2016
|
||||||||||||||||||||
|
|
Adjusted Operating Margin
(*)
|
|
Operating Expenses
(*)
|
|
Net Income
|
|
|
Adjusted Operating Margin
(*)
|
|
Operating Expenses
(*)
|
|
EBIT
|
||||||||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||||||||||
Gas distribution operations
|
|
$
|
817
|
|
|
$
|
595
|
|
|
$
|
77
|
|
|
|
$
|
911
|
|
|
$
|
560
|
|
|
$
|
353
|
|
Gas marketing services
|
|
139
|
|
|
112
|
|
|
19
|
|
|
|
190
|
|
|
81
|
|
|
109
|
|
||||||
Wholesale gas services
|
|
24
|
|
|
26
|
|
|
—
|
|
|
|
(36
|
)
|
|
33
|
|
|
(68
|
)
|
||||||
Gas midstream operations
|
|
19
|
|
|
26
|
|
|
20
|
|
|
|
15
|
|
|
24
|
|
|
(6
|
)
|
||||||
All other
|
|
3
|
|
|
46
|
|
|
(2
|
)
|
|
|
4
|
|
|
65
|
|
|
(60
|
)
|
||||||
Intercompany eliminations
|
|
(4
|
)
|
|
(4
|
)
|
|
—
|
|
|
|
(4
|
)
|
|
(4
|
)
|
|
—
|
|
||||||
Consolidated
|
|
$
|
998
|
|
|
$
|
801
|
|
|
$
|
114
|
|
|
|
$
|
1,080
|
|
|
$
|
759
|
|
|
$
|
328
|
|
(*)
|
Adjusted operating margin and operating expenses are adjusted for Nicor Gas revenue tax expenses, which are passed through directly to customers.
|
|
|
Predecessor
|
||||||||||||||||||||||
|
|
Year Ended December 31, 2015
|
|
Year Ended December 31, 2014
|
||||||||||||||||||||
|
|
Adjusted Operating Margin
(*)
|
|
Operating Expenses
(*)
|
|
EBIT
|
|
Adjusted Operating Margin
(*)
|
|
Operating Expenses
(*)
|
|
EBIT
|
||||||||||||
|
|
(in millions)
|
|
(in millions)
|
||||||||||||||||||||
Gas distribution operations
|
|
$
|
1,657
|
|
|
$
|
1,086
|
|
|
$
|
581
|
|
|
$
|
1,648
|
|
|
$
|
1,075
|
|
|
$
|
582
|
|
Gas marketing services
|
|
317
|
|
|
165
|
|
|
152
|
|
|
311
|
|
|
179
|
|
|
132
|
|
||||||
Wholesale gas services
|
|
183
|
|
|
71
|
|
|
110
|
|
|
501
|
|
|
79
|
|
|
425
|
|
||||||
Gas midstream operations
|
|
36
|
|
|
62
|
|
|
(23
|
)
|
|
31
|
|
|
50
|
|
|
(17
|
)
|
||||||
All other
|
|
7
|
|
|
70
|
|
|
(59
|
)
|
|
7
|
|
|
22
|
|
|
(10
|
)
|
||||||
Intercompany eliminations
|
|
(5
|
)
|
|
(5
|
)
|
|
—
|
|
|
(8
|
)
|
|
(8
|
)
|
|
—
|
|
||||||
Consolidated
|
|
$
|
2,195
|
|
|
$
|
1,449
|
|
|
$
|
761
|
|
|
$
|
2,490
|
|
|
$
|
1,397
|
|
|
$
|
1,112
|
|
(*)
|
Adjusted operating margin and operating expenses are adjusted for Nicor Gas revenue tax expenses, which are passed through directly to customers.
|
|
(in millions)
|
||
EBIT – 2014
|
$
|
582
|
|
Adjusted operating margin
|
|
|
|
Increase from pipeline infrastructure programs, primarily at Atlanta Gas Light and Nicor Gas
|
34
|
|
|
Increase mainly driven by customer usage and growth
|
13
|
|
|
Decrease related to weather, net of hedging
|
(20
|
)
|
|
Decrease in rider program recoveries at Nicor Gas, offset in operating expenses below
|
(18
|
)
|
|
Increase in adjusted operating margin
|
9
|
|
|
Operating expenses
|
|
|
|
Decrease in rider program recoveries at Nicor Gas, offset in adjusted operating margin above
|
(18
|
)
|
|
Increase in depreciation due to additional assets placed in service
|
19
|
|
|
Increase in benefit expenses primarily related to higher pension costs and medical benefits
|
12
|
|
|
Increase in 2015 due to write-off of PRP-related costs from global settlement
|
5
|
|
|
Increase in payroll and variable compensation costs
|
9
|
|
|
Decrease in bad debt expenses due to changes in natural gas consumption and prices
|
(2
|
)
|
|
Decrease in weather-related expenses
|
(4
|
)
|
|
Decrease in outside services and other expenses primarily due to maintenance programs
|
(5
|
)
|
|
Decrease in fleet expenses resulting from lower fuel prices
|
(5
|
)
|
|
Increase in operating expenses
|
11
|
|
|
Increase in other income
|
1
|
|
|
EBIT – 2015
|
$
|
581
|
|
|
(in millions)
|
||
EBIT – 2014
|
$
|
132
|
|
Adjusted operating margin
|
|
||
Increase in value of unrealized hedges as a result of changes in NYMEX natural gas prices,
net of recoveries |
19
|
|
|
Increase in warranty margins
|
2
|
|
|
LOCOM adjustments, net of recoveries
|
3
|
|
|
Decrease in gas marketing margins
|
(8
|
)
|
|
Decrease due to weather, net of weather hedging
|
(9
|
)
|
|
Other
|
(1
|
)
|
|
Increase in adjusted operating margin
|
6
|
|
|
Operating expenses
|
|
|
|
Decrease in depreciation and amortization
|
(3
|
)
|
|
Decrease in outside services, labor and marketing expenses
|
(8
|
)
|
|
Decrease in other expenses, primarily bad debt expenses
|
(3
|
)
|
|
Decrease in operating expenses
|
(14
|
)
|
|
EBIT – 2015
|
$
|
152
|
|
|
(in millions)
|
||
EBIT – 2014
|
$
|
425
|
|
Adjusted operating margin
|
|
|
|
Decrease in mark-to-market gains of storage derivatives as a result of changes in NYMEX natural gas prices
|
(41
|
)
|
|
Decrease in commercial activity driven by changes in price volatility
|
(304
|
)
|
|
Decrease in the value of transportation and forward commodity derivatives from price movements related
to natural gas transportation positions |
(27
|
)
|
|
LOCOM adjustments, net of current period recoveries
|
54
|
|
|
Decrease in adjusted operating margin
|
(318
|
)
|
|
Operating expenses
|
|
||
Decrease in compensation and benefits driven largely by year-over-year changes in earnings and capture of
natural gas storage value |
(8
|
)
|
|
Decrease in operating expenses
|
(8
|
)
|
|
Decrease in other income primarily related to the gain on sale of Compass Energy in 2014
|
(5
|
)
|
|
EBIT – 2015
|
$
|
110
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Commercial activity recognized
|
$
|
(10
|
)
|
|
|
$
|
34
|
|
|
$
|
140
|
|
|
$
|
444
|
|
Gain (loss) on storage derivatives
|
(20
|
)
|
|
|
(38
|
)
|
|
45
|
|
|
86
|
|
||||
Gain (loss) on transportation and forward
commodity derivatives |
64
|
|
|
|
(31
|
)
|
|
11
|
|
|
38
|
|
||||
LOCOM adjustments, net of current period recoveries
|
—
|
|
|
|
(1
|
)
|
|
(13
|
)
|
|
(67
|
)
|
||||
Purchase accounting adjustments to fair value
inventory and contracts |
(10
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Adjusted operating margin
|
$
|
24
|
|
|
|
$
|
(36
|
)
|
|
$
|
183
|
|
|
$
|
501
|
|
|
Storage Withdrawal Schedule
|
|
|
|||||||
|
Total storage
(WACOG $2.76) |
|
Expected net operating gains
(a)
|
|
Physical Transportation Transactions – Expected Net Operating Gains (Losses)
(b)
|
|||||
|
(in mmBtu in millions)
|
|
(in millions)
|
|
(in millions)
|
|||||
2017
|
67.2
|
|
|
$
|
56
|
|
|
$
|
(38
|
)
|
2018 and thereafter
|
2.9
|
|
|
3
|
|
|
6
|
|
||
Total at December 31, 2016
|
70.1
|
|
|
$
|
59
|
|
|
$
|
(32
|
)
|
(a)
|
Represents expected operating gains from planned storage withdrawals associated with existing inventory positions and could change as wholesale gas services adjusts its daily injection and withdrawal plans in response to changes in future market conditions and forward NYMEX price fluctuations. Also includes the impact of purchase accounting adjustments to reflect natural gas storage inventory at market value. Excluding the impact of these adjustments, the expected net operating gains at December 31, 2016 would have been $85 million.
|
(b)
|
Represents the periods associated with the transportation derivative (gains) and losses during which the derivatives will be settled and the physical transportation transactions will occur that offset the derivative (gains) and losses that were previously recognized.
|
|
Successor
|
||||||||||||||||||||
|
July 1, 2016 through December 31, 2016
|
||||||||||||||||||||
|
Gas Distribution Operations
|
Gas Marketing Services
|
Wholesale Gas Services
|
Gas Midstream Operations
|
All Other
|
Intercompany Elimination
|
Consolidated
|
||||||||||||||
|
(in millions)
|
||||||||||||||||||||
Consolidated Net Income
|
$
|
77
|
|
$
|
19
|
|
$
|
—
|
|
$
|
20
|
|
$
|
(2
|
)
|
$
|
—
|
|
$
|
114
|
|
Income taxes
|
51
|
|
7
|
|
(3
|
)
|
16
|
|
5
|
|
—
|
|
76
|
|
|||||||
Interest expense, net of
amounts capitalized |
105
|
|
1
|
|
3
|
|
16
|
|
(44
|
)
|
—
|
|
81
|
|
|||||||
EBIT
|
$
|
233
|
|
$
|
27
|
|
$
|
—
|
|
$
|
52
|
|
$
|
(41
|
)
|
$
|
—
|
|
$
|
271
|
|
|
Successor
|
||||||||||||||||||||
|
July 1, 2016 through December 31, 2016
|
||||||||||||||||||||
|
Gas Distribution Operations
|
Gas Marketing Services
|
Wholesale Gas Services
|
Gas Midstream Operations
|
All Other
|
Intercompany Elimination
|
Consolidated
|
||||||||||||||
|
(in millions)
|
||||||||||||||||||||
Operating Income (Loss)
|
$
|
222
|
|
$
|
27
|
|
$
|
(2
|
)
|
$
|
(7
|
)
|
$
|
(43
|
)
|
$
|
—
|
|
$
|
197
|
|
Other operating expenses
(a)
|
626
|
|
112
|
|
26
|
|
26
|
|
46
|
|
(4
|
)
|
832
|
|
|||||||
Revenue tax expense
(b)
|
(31
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(31
|
)
|
|||||||
Adjusted Operating Margin
|
$
|
817
|
|
$
|
139
|
|
$
|
24
|
|
$
|
19
|
|
$
|
3
|
|
$
|
(4
|
)
|
$
|
998
|
|
|
Predecessor
|
||||||||||||||||||||
|
January 1, 2016 through June 30, 2016
|
||||||||||||||||||||
|
Gas Distribution Operations
|
Gas Marketing Services
|
Wholesale Gas Services
|
Gas Midstream Operations
|
All Other
|
Intercompany Elimination
|
Consolidated
|
||||||||||||||
|
(in millions)
|
||||||||||||||||||||
Operating Income (Loss)
|
$
|
351
|
|
$
|
109
|
|
$
|
(69
|
)
|
$
|
(9
|
)
|
$
|
(61
|
)
|
$
|
—
|
|
$
|
321
|
|
Other operating expenses
(a)
|
616
|
|
81
|
|
33
|
|
24
|
|
65
|
|
(4
|
)
|
815
|
|
|||||||
Revenue tax expense
(b)
|
(56
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(56
|
)
|
|||||||
Adjusted Operating Margin
|
$
|
911
|
|
$
|
190
|
|
$
|
(36
|
)
|
$
|
15
|
|
$
|
4
|
|
$
|
(4
|
)
|
$
|
1,080
|
|
|
Predecessor
|
||||||||||||||||||||
|
Year Ended December 31, 2015
|
||||||||||||||||||||
|
Gas Distribution Operations
|
Gas Marketing Services
|
Wholesale Gas Services
|
Gas Midstream Operations
|
All Other
|
Intercompany Elimination
|
Consolidated
|
||||||||||||||
|
(in millions)
|
||||||||||||||||||||
Operating Income (Loss)
|
$
|
571
|
|
$
|
152
|
|
$
|
112
|
|
$
|
(26
|
)
|
$
|
(63
|
)
|
$
|
—
|
|
$
|
746
|
|
Other operating expenses
(a)
|
1,187
|
|
165
|
|
71
|
|
62
|
|
70
|
|
(5
|
)
|
1,550
|
|
|||||||
Revenue tax expense
(b)
|
(101
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(101
|
)
|
|||||||
Adjusted Operating Margin
|
$
|
1,657
|
|
$
|
317
|
|
$
|
183
|
|
$
|
36
|
|
$
|
7
|
|
$
|
(5
|
)
|
$
|
2,195
|
|
|
Predecessor
|
||||||||||||||||||||
|
Year Ended December 31, 2014
|
||||||||||||||||||||
|
Gas Distribution Operations
|
Gas Marketing Services
|
Wholesale Gas Services
|
Gas Midstream Operations
|
All Other
|
Intercompany Elimination
|
Consolidated
|
||||||||||||||
|
(in millions)
|
||||||||||||||||||||
Operating Income (Loss)
|
$
|
573
|
|
$
|
132
|
|
$
|
425
|
|
$
|
(19
|
)
|
$
|
(16
|
)
|
$
|
—
|
|
$
|
1,095
|
|
Other operating expenses
(a)
|
1,205
|
|
179
|
|
79
|
|
50
|
|
22
|
|
(8
|
)
|
1,527
|
|
|||||||
Gain on disposition of assets
|
—
|
|
—
|
|
(3
|
)
|
—
|
|
1
|
|
—
|
|
(2
|
)
|
|||||||
Revenue tax expense
(b)
|
(130
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(130
|
)
|
|||||||
Adjusted Operating Margin
|
$
|
1,648
|
|
$
|
311
|
|
$
|
501
|
|
$
|
31
|
|
$
|
7
|
|
$
|
(8
|
)
|
$
|
2,490
|
|
(a)
|
Adjusted for the following operating expenses: other operations and maintenance, depreciation and amortization, taxes other than income taxes, goodwill impairment in 2015, and Merger-related expenses.
|
(b)
|
Adjusted for Nicor Gas' revenue tax expenses, which are passed through directly to customers.
|
|
Miles of Pipe
|
|
Expected Capital
Expenditures (a) |
|
Ownership
Interest (a) |
|
FERC Filing
|
|
Expected FERC Approval
|
||||
|
|
|
(in millions)
|
|
|
|
|
|
|
||||
Atlantic Coast Pipeline
(b)
|
594
|
|
|
$
|
256
|
|
|
5
|
%
|
|
2015
|
|
2017
|
PennEast Pipeline
(c)
|
118
|
|
|
270
|
|
|
20
|
%
|
|
2015
|
|
2017
|
|
Dalton Pipeline
(d)
|
115
|
|
|
254
|
|
|
50
|
%
|
|
2015
|
|
(e)
|
|
Total
|
827
|
|
|
$
|
780
|
|
|
|
|
|
|
|
(a)
|
Represents the Company's expected capital expenditures and ownership interest as applicable, which may change.
|
(b)
|
In 2014, the Company entered into a joint venture to construct and operate a natural gas pipeline that will run from West Virginia through Virginia and into eastern North Carolina to meet the region's growing demand for natural gas. The proposed pipeline project is expected to transport natural gas to customers in Virginia.
|
(c)
|
In 2014, the Company entered into a joint venture to construct and operate a natural gas pipeline that will transport low-cost natural gas from the Marcellus Shale area to customers in New Jersey. The Company believes this will alleviate takeaway constraints in the Marcellus region and help mitigate some of the price volatility experienced during recent winters.
|
(d)
|
In 2014, the Company entered into two agreements associated with the construction of the Dalton Pipeline, which will serve as an extension of the Transco pipeline system and provide additional natural gas supply to customers in Georgia. The first is a construction and ownership agreement and the second is an agreement to lease ownership in this lateral pipeline extension once it is placed in service.
|
(e)
|
The Dalton Pipeline received FERC approval on August 3, 2016, and construction is currently underway.
|
•
|
distributing natural gas for Marketers;
|
•
|
constructing, operating, and maintaining the gas system infrastructure, including responding to customer service calls and leaks;
|
•
|
reading meters and maintaining underlying customer premise information for Marketers; and
|
•
|
planning and contracting for capacity on interstate transportation and storage systems.
|
|
Nicor Gas
|
|
Atlanta Gas Light
|
|
Elizabethtown Gas
|
|
Virginia Natural Gas
|
|
Florida City Gas
|
|
Chattanooga Gas
|
Authorized return on equity
(a)
|
10.17%
|
|
10.75%
|
|
10.30%
|
|
10.00%
|
|
11.25%
|
|
10.05%
|
Weather normalization
(b)
|
|
|
|
|
ü
|
|
ü
|
|
|
|
ü
|
Decoupled, including straight-
fixed-variable rates (c) |
|
|
ü
|
|
|
|
ü
|
|
|
|
ü
|
Regulatory infrastructure
program rates (d) |
ü
|
|
ü
|
|
ü
|
|
ü
|
|
ü
|
|
|
Bad debt rider
(e)
|
ü
|
|
|
|
|
|
ü
|
|
|
|
ü
|
Synergy sharing policy
(f)
|
|
|
ü
|
|
|
|
|
|
|
|
|
Energy efficiency plan
(g)
|
ü
|
|
|
|
ü
|
|
ü
|
|
ü
|
|
ü
|
Last decision on change in rates
|
2009
|
|
2017
(h)
|
|
2009
(i)
|
|
2011
(j)
|
|
2004
|
|
2010
|
(a)
|
The authorized return on equity represents those authorized at December 31, 2016.
|
(b)
|
Regulatory mechanisms that allow recovery of costs in the event of unseasonal weather, but are not direct offsets to the potential impacts on earnings of weather and customer consumption. These mechanisms are designed to help stabilize operating results by increasing base rate amounts charged to customers when weather is warmer than normal and decreasing amounts charged when weather is colder than normal.
|
(c)
|
Recovery of fixed customer service costs separately from assumed natural gas volumes used by customers.
|
(d)
|
Programs that update or expand distribution systems and LNG facilities.
|
(e)
|
The recovery (refund) of bad debt expense over (under) an established benchmark expense. Virginia Natural Gas and Chattanooga Gas recover the gas portion of bad debt expense through their purchased gas adjustment mechanisms.
|
(f)
|
The recovery of 50% of net synergy savings achieved on mergers and acquisitions.
|
(g)
|
Recovery of costs associated with plans to achieve specified energy savings goals.
|
(h)
|
The Georgia PSC approved Atlanta Gas Light's petition for the Georgia Rate Adjustment Mechanism (GRAM) on February 21, 2017.
|
(i)
|
Elizabethtown Gas filed a general rate case with the New Jersey BPU on September 1, 2016, which is scheduled to be resolved during 2017. See Note 3 to the financial statements under "Regulatory Matters – Base Rate Cases" for additional information.
|
(j)
|
On December 13, 2016, Virginia Natural Gas filed a notice of intent with the Virginia Commission as required at least 60 days prior to the filing of a general base rate case.
|
Utility
|
|
Program
|
|
Program Details
|
|
Recovery
|
|
Expenditures in 2016
|
|
Expenditures Since Project Inception
|
|
Miles of Pipe
Installed Since Project Inception |
|
Scope of
Program |
|
Program Duration
|
|
Last
Year of Program |
|||||||
|
|
|
|
|
|
|
|
(in millions)
|
|
|
|
(miles)
|
|
(years)
|
|
|
|||||||||
Nicor Gas
|
|
Investing in Illinois
|
|
(a)(b)
|
|
Rider
|
|
$
|
298
|
|
|
$
|
571
|
|
|
343
|
|
|
800
|
|
|
9
|
|
|
2023
|
Atlanta Gas Light
|
|
Integrated Vintage Plastic Replacement Program
(i-VPR) |
|
(c)(i)
|
|
Rider
|
|
71
|
|
|
201
|
|
|
593
|
|
|
756
|
|
|
4
|
|
|
2017
|
||
Atlanta Gas Light
|
|
Integrated System Reinforcement Program
(i-SRP) |
|
(g)(i)
|
|
Rider
|
|
62
|
|
|
370
|
|
|
n/a
|
|
|
n/a
|
|
|
8
|
|
|
2017
|
||
Atlanta Gas Light
|
|
Integrated Customer Growth Program
(i-CGP) |
|
(h)(i)
|
|
Rider
|
|
8
|
|
|
71
|
|
|
n/a
|
|
|
n/a
|
|
|
8
|
|
|
2017
|
||
Chattanooga Gas
|
|
Bare Steel & Cast Iron
|
|
(e)
|
|
Base Rates
|
|
3
|
|
|
40
|
|
|
90
|
|
|
111
|
|
|
10
|
|
|
2020
|
||
Florida City Gas
|
|
Safety, Access and Facility Enhancement Program (SAFE)
|
|
(d)
|
|
Rider
|
|
11
|
|
|
11
|
|
|
38
|
|
|
250
|
|
|
10
|
|
|
2025
|
||
Florida City Gas
|
|
Galvanized Replacement Program
|
|
(f)
|
|
Base Rates
|
|
1
|
|
|
16
|
|
|
80
|
|
|
111
|
|
|
17
|
|
|
2017
|
||
Virginia Natural Gas
|
|
Steps to Advance Virginia's Energy (SAVE and SAVE II)
|
|
(a)(j)
|
|
Rider
|
|
32
|
|
|
122
|
|
|
204
|
|
|
496
|
|
|
10
|
|
|
2021
|
||
Elizabethtown Gas
|
|
Aging Infrastructure Replacement (AIR)
|
|
(e)(k)
|
|
Base Rates
|
|
22
|
|
|
99
|
|
|
89
|
|
|
130
|
|
|
4
|
|
|
2017
|
||
Total
|
|
|
|
|
|
|
|
$
|
508
|
|
|
$
|
1,501
|
|
|
1,437
|
|
|
2,654
|
|
|
|
|
|
(a)
|
Cast iron, bare steel, mid-vintage plastic, and risk-based materials.
|
(b)
|
Represents expenditures on qualifying infrastructure that have been placed into service after the rate freeze expiration date, December 9, 2014.
|
(c)
|
Early vintage plastic, risk-based mid-vintage plastic, and mid-vintage neighborhood convenience.
|
(d)
|
Four-inch and smaller mains, associated service lines, and in some instances above-ground facilities associated with rear-lot easements.
|
(e)
|
Cast iron and bare steel.
|
(f)
|
Galvanized and X-Tube steel. Reflects expenditures and miles of pipe installed since the Company acquired Florida City Gas in 2004.
|
(g)
|
Large diameter pressure improvement and system reinforcement projects.
|
(h)
|
New business construction and strategic line extension.
|
(i)
|
The Georgia PSC approved Atlanta Gas Light's petition for GRAM on February 21, 2017. See Note 3 to the financial statements under "Regulatory Matters – Base Rate Cases" for additional information.
|
(j)
|
On December 13, 2016, Virginia Natural Gas filed a notice of intent with the Virginia Commission as required at least 60 days prior to the filing of a general base rate case.
|
(k)
|
Elizabethtown Gas filed a general rate case with the New Jersey BPU on September 1, 2016, which is scheduled to be resolved during 2017. See Note 3 to the financial statements under "Regulatory Matters – Base Rate Cases" for additional information.
|
|
Successor
|
|
|
Predecessor
|
||||||||||||||
|
Total Amount Received
|
|
|
Total Amount Received
|
|
|||||||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
|
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
|
Expiration Date
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
|
|
||||||||||||
Elizabethtown Gas
|
$
|
3
|
|
|
|
$
|
12
|
|
|
$
|
28
|
|
|
$
|
18
|
|
|
Mar-19
|
Virginia Natural Gas
|
2
|
|
|
|
9
|
|
|
15
|
|
|
14
|
|
|
Mar-18
|
||||
Atlanta Gas Light
|
1
|
|
|
|
6
|
|
|
15
|
|
|
13
|
|
|
Mar-20
|
||||
Florida City Gas
|
—
|
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
(*)
|
||||
Chattanooga Gas
|
—
|
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
Mar-18
|
||||
Total
|
$
|
6
|
|
|
|
$
|
29
|
|
|
$
|
60
|
|
|
$
|
47
|
|
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
December 31, 2016
|
|
|
December 31, 2015
|
||||
|
(in millions)
|
|
|
(in millions)
|
||||
Atlanta Gas Light
|
$
|
110
|
|
|
|
$
|
103
|
|
Virginia Natural Gas
|
11
|
|
|
|
12
|
|
||
Elizabethtown Gas
|
6
|
|
|
|
4
|
|
||
Nicor Gas
|
2
|
|
|
|
3
|
|
||
Total
|
$
|
129
|
|
|
|
$
|
122
|
|
•
|
the creditworthiness of the counterparties involved and the impact of credit enhancements (such as cash deposits and letters of credit);
|
•
|
events specific to a given counterparty; and
|
•
|
the impact of the Company's nonperformance risk on its liabilities.
|
|
|
Expires
|
|
|
|
|
Expires Within One Year
|
||||||||||||||||
Company
|
|
2017
|
|
2018
|
|
Total
|
|
Unused
|
Term Out
|
|
No Term Out
|
||||||||||||
|
|
(in millions)
|
|
(in millions)
|
(in millions)
|
||||||||||||||||||
Southern Company Gas Capital
(*)
|
|
$
|
49
|
|
|
$
|
1,251
|
|
|
$
|
1,300
|
|
|
$
|
1,249
|
|
$
|
—
|
|
|
$
|
49
|
|
Nicor Gas
|
|
26
|
|
|
674
|
|
|
700
|
|
|
700
|
|
—
|
|
|
26
|
|
||||||
Total
|
|
$
|
75
|
|
|
$
|
1,925
|
|
|
$
|
2,000
|
|
|
$
|
1,949
|
|
$
|
—
|
|
|
$
|
75
|
|
(*)
|
Southern Company Gas guarantees the obligations of Southern Company Gas Capital.
|
|
|
Short-term Debt at the End of the Period
|
|
Short-term Debt During the Period
(*)
|
||||||||||||||
|
|
Amount
Outstanding |
|
Weighted Average Interest Rate
|
|
Average
Amount Outstanding |
|
Weighted Average Interest Rate
|
|
Maximum
Amount Outstanding |
||||||||
|
|
(in millions)
|
|
|
|
(in millions)
|
|
|
|
(in millions)
|
||||||||
Successor – December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Southern Company Gas Capital
|
|
$
|
733
|
|
|
1.09
|
%
|
|
$
|
309
|
|
|
0.67
|
%
|
|
$
|
770
|
|
Nicor Gas
|
|
524
|
|
|
0.95
|
%
|
|
461
|
|
|
0.79
|
%
|
|
587
|
|
|||
Total
|
|
$
|
1,257
|
|
|
1.03
|
%
|
|
$
|
770
|
|
|
0.74
|
%
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Predecessor – December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Southern Company Gas Capital
|
|
$
|
471
|
|
|
0.71
|
%
|
|
$
|
382
|
|
|
0.49
|
%
|
|
$
|
787
|
|
Nicor Gas
|
|
539
|
|
|
0.52
|
%
|
|
349
|
|
|
0.38
|
%
|
|
585
|
|
|||
Total
|
|
$
|
1,010
|
|
|
0.60
|
%
|
|
$
|
731
|
|
|
0.44
|
%
|
|
|
||
Predecessor – December 31, 2014:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Southern Company Gas Capital
|
|
$
|
590
|
|
|
0.48
|
%
|
|
$
|
399
|
|
|
0.33
|
%
|
|
$
|
1,006
|
|
Nicor Gas
|
|
585
|
|
|
0.44
|
%
|
|
279
|
|
|
0.25
|
%
|
|
614
|
|
|||
Total
|
|
$
|
1,175
|
|
|
0.46
|
%
|
|
$
|
678
|
|
|
0.29
|
%
|
|
|
(*)
|
Average and maximum amounts are based upon daily balances during the successor period of
July 1, 2016 through December 31, 2016
and the predecessor years ended December 31,
2015
and
2014
.
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Contracts outstanding at beginning of period, assets (liabilities), net
|
$
|
(54
|
)
|
|
|
$
|
75
|
|
|
$
|
61
|
|
|
$
|
(82
|
)
|
Contracts realized or otherwise settled
|
18
|
|
|
|
(77
|
)
|
|
(17
|
)
|
|
38
|
|
||||
Current period changes
(a)
|
48
|
|
|
|
(82
|
)
|
|
32
|
|
|
105
|
|
||||
Contracts outstanding at the end of period, assets (liabilities), net
|
12
|
|
|
|
(84
|
)
|
|
76
|
|
|
61
|
|
||||
Netting of cash collateral
|
62
|
|
|
|
120
|
|
|
96
|
|
|
133
|
|
||||
Cash collateral and net fair value of contracts outstanding at end of period
(b)
|
$
|
74
|
|
|
|
$
|
36
|
|
|
$
|
172
|
|
|
$
|
194
|
|
(a)
|
Current period changes also include the changes in fair value of new contracts entered into during the period, if any.
|
(b)
|
Net fair value of derivative contracts outstanding includes premium and associated intrinsic value associated with weather derivatives of
$4 million
at
December 31, 2016
,
$5 million
at June 30, 2016,
$10 million
at
December 31, 2015
, and
$3 million
at
December 31, 2014
.
|
|
Successor
|
|
|
Predecessor
|
||
|
2016
|
|
|
2015
|
||
|
mmBtu Volume
|
|
|
mmBtu Volume
|
||
|
(in millions)
|
|
|
(in millions)
|
||
Commodity – Natural gas
|
157
|
|
|
|
(9
|
)
|
Net Purchased/(Sold) Volume
|
157
|
|
|
|
(9
|
)
|
|
|
|
Fair Value Measurements
|
||||||||||||
|
|
|
Successor – December 31, 2016
|
||||||||||||
|
|
|
Maturity
|
||||||||||||
|
Total
Fair Value |
|
Year 1
|
|
Years 2 & 3
|
|
Years 4 and thereafter
|
||||||||
|
(in millions)
|
||||||||||||||
Level 1
(a)
|
$
|
(7
|
)
|
|
$
|
15
|
|
|
$
|
(15
|
)
|
|
$
|
(7
|
)
|
Level 2
(b)
|
19
|
|
|
11
|
|
|
—
|
|
|
8
|
|
||||
Level 3
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Fair value of contracts outstanding at end of period
(c)
|
$
|
12
|
|
|
$
|
26
|
|
|
$
|
(15
|
)
|
|
$
|
1
|
|
(a)
|
Valued using NYMEX futures prices.
|
(b)
|
Valued using basis transactions that represent the cost to transport natural gas from a NYMEX delivery point to the contract delivery point. These transactions are based on quotes obtained either through electronic trading platforms or directly from brokers.
|
(c)
|
Excludes cash collateral of
$62 million
at
December 31, 2016
.
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31, 2016
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Period end
|
$
|
2.3
|
|
|
|
$
|
1.9
|
|
|
$
|
2.4
|
|
|
$
|
4.7
|
|
Average
|
2.0
|
|
|
|
2.0
|
|
|
3.0
|
|
|
4.3
|
|
||||
High
|
2.8
|
|
|
|
2.5
|
|
|
7.3
|
|
|
19.7
|
|
||||
Low
|
1.4
|
|
|
|
1.6
|
|
|
1.6
|
|
|
1.8
|
|
|
Gross Receivables
|
|
Gross Payables
|
||||||||||||||
|
Successor
|
|
|
Predecessor
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
2016
|
|
|
2015
|
|
2016
|
|
|
2015
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
|
(in millions)
|
|
|
(in millions)
|
||||||||
Netting agreements in place:
|
|
|
|
|
|
|
|
|
|
||||||||
Counterparty is investment grade
|
$
|
375
|
|
|
|
$
|
299
|
|
|
$
|
227
|
|
|
|
$
|
136
|
|
Counterparty is non-investment grade
|
14
|
|
|
|
8
|
|
|
31
|
|
|
|
17
|
|
||||
Counterparty has no external rating
|
223
|
|
|
|
133
|
|
|
339
|
|
|
|
265
|
|
||||
No netting agreements in place:
|
|
|
|
|
|
|
|
|
|
||||||||
Counterparty is investment grade
|
11
|
|
|
|
5
|
|
|
—
|
|
|
|
—
|
|
||||
Amount recorded in Consolidated Balance Sheets
|
$
|
623
|
|
|
|
$
|
445
|
|
|
$
|
597
|
|
|
|
$
|
418
|
|
|
2017
|
|
2018-
2019 |
|
2020-
2021 |
|
After
2021 |
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Long-term debt
(a)
—
|
|
|
|
|
|
|
|
|
|
||||||||||
Principal
|
$
|
22
|
|
|
$
|
505
|
|
|
$
|
330
|
|
|
$
|
3,855
|
|
|
$
|
4,712
|
|
Interest
|
207
|
|
|
406
|
|
|
364
|
|
|
2,500
|
|
|
3,477
|
|
|||||
Pipeline charges, storage capacity and gas supply
(b)
|
822
|
|
|
1,049
|
|
|
746
|
|
|
2,591
|
|
|
5,208
|
|
|||||
Operating leases
(c)
|
18
|
|
|
33
|
|
|
30
|
|
|
38
|
|
|
119
|
|
|||||
Asset management agreements
(d)
|
10
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|||||
Standby letters of credit and performance/surety bonds
(e)
|
85
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
86
|
|
|||||
Financial derivative obligations
(f)
|
487
|
|
|
70
|
|
|
11
|
|
|
1
|
|
|
569
|
|
|||||
Pension and other postretirement benefit plans
(g)
|
21
|
|
|
45
|
|
|
—
|
|
|
—
|
|
|
66
|
|
|||||
Purchase commitments —
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital
(h)
|
1,736
|
|
|
3,396
|
|
|
2,563
|
|
|
—
|
|
|
7,695
|
|
|||||
Other
(i)
|
60
|
|
|
15
|
|
|
2
|
|
|
2
|
|
|
79
|
|
|||||
Total
|
$
|
3,468
|
|
|
$
|
5,527
|
|
|
$
|
4,046
|
|
|
$
|
8,987
|
|
|
$
|
22,028
|
|
(a)
|
Amounts are reflected based on final maturity dates. The Company plans to continue, when economically feasible, to retire higher-cost securities and replace these obligations with lower-cost capital if market conditions permit. Variable rate interest obligations are estimated based on rates at January 1, 2017, as reflected in the statements of capitalization. Fixed rates include, where applicable, the effects of interest rate derivatives employed to manage interest rate risk.
|
(b)
|
Includes charges recoverable through a natural gas cost recovery mechanism, or alternatively billed to Marketers, and demand charges associated with Sequent. The gas supply balance includes amounts for Nicor Gas and SouthStar gas commodity purchase commitments of 33 million mmBtu at floating gas prices calculated using forward natural gas prices at December 31, 2016 and valued at $106 million. As the Company does for certain of its affiliates, it provides guarantees to certain gas suppliers of SouthStar in support of payment obligations.
|
(c)
|
Certain operating leases have provisions for step rent or escalation payments and certain lease concessions are accounted for by recognizing the future minimum lease payments on a straight-line basis over the respective minimum lease terms. However, this accounting treatment does not affect the future annual operating lease cash obligations as shown herein. The Company's operating leases are primarily for real estate.
|
(d)
|
Represent fixed-fee minimum payments for Sequent's affiliated asset management agreements.
|
(e)
|
Guarantees are provided to certain municipalities and other agencies and certain gas suppliers of SouthStar in support of payment obligations.
|
(f)
|
Includes liabilities related to energy-related derivatives. For additional information, see Notes 1 and 10 to the financial statements.
|
(g)
|
The Company forecasts contributions to the pension and other postretirement benefit plans over a three-year period. The Company anticipates no mandatory contributions to the qualified pension plan during the next three years. Amounts presented represent estimated benefit payments for the nonqualified pension plans, estimated non-trust benefit payments for the other postretirement benefit plans, and estimated contributions to the other postretirement benefit plan trusts, all of which will be made from the Company's corporate assets. See Note 2 to the financial statements for additional information related to the pension and other postretirement benefit plans, including estimated benefit payments. Certain benefit payments will be made through the related benefit plans. Other benefit payments will be made from the Company's corporate assets.
|
(h)
|
Estimated capital expenditures are provided through 2021.
|
(i)
|
Includes contractual environmental remediation liabilities that are generally recoverable through base rates or rate rider mechanisms and long-term service agreements.
|
•
|
the impact of recent and future federal and state regulatory changes, including environmental laws,
and also changes in tax and other laws and regulations to which
the Company is
subject, including potential tax reform legislation, as well as changes in application of existing laws and regulations;
|
•
|
current and future litigation, regulatory investigations, proceedings, or inquiries
;
|
•
|
the effects, extent, and timing of the entry of additional competition in the markets in which
the Company operates;
|
•
|
variations in demand for natural gas, including those relating to weather, the general economy and recovery from the last recession, population and business growth (and declines), the effects of energy conservation and efficiency measures, including from the development and deployment of alternative energy sources, and any potential economic impacts resulting from federal fiscal decisions;
|
•
|
available sources and costs of natural gas;
|
•
|
limits on pipeline capacity;
|
•
|
effects of inflation;
|
•
|
the ability to control costs and avoid cost overruns during the development
and construction of facilities;
|
•
|
investment performance of
the Company's
employee and retiree benefit plans
;
|
•
|
advances in technology;
|
•
|
state and federal rate regulations
and the impact of pending and future rate cases and negotiations, including rate
actions relating
to natural gas and other cost recovery mechanisms;
|
•
|
the inherent risks involved in transporting and storing natural gas;
|
•
|
the ability to successfully operate the natural gas distribution and storage facilities and the successful performance of necessary corporate functions;
|
•
|
internal restructuring or other restructuring options that may be pursued;
|
•
|
potential business strategies, including acquisitions or dispositions of assets or businesses, which cannot be assured to be completed or beneficial to
the Company;
|
•
|
the possibility that the anticipated benefits from the Merger cannot be fully realized or may take longer to realize than expected, the possibility that costs related to integration with Southern Company will be greater than expected, the ability to retain and hire key personnel and maintain relationships with customers, suppliers, or other business partners, and the diversion of management time on integration related issues;
|
•
|
the ability of counterparties of
the Company
to make payments as and when due and to perform as required;
|
•
|
the direct or indirect effect on the
Company's
business resulting from cyber intrusion or terrorist incidents and the threat of terrorist incidents;
|
•
|
interest rate fluctuations and financial market conditions and the results of financing efforts;
|
•
|
changes in the Company's
credit ratings, including impacts on interest rates, access to capital markets, and collateral requirements;
|
•
|
the impacts of any sovereign financial issues, including impacts on interest rates, access to capital markets, impacts on foreign currency exchange rates, counterparty performance, and the economy in general
;
|
•
|
catastrophic events such as fires, earthquakes, explosions, floods, tornadoes,
hurricanes and other storms, droughts, pandemic health events such as influenzas, or other similar occurrences;
|
•
|
the direct or indirect effects on the
Company's business resulting from incidents affecting the U.S. natural gas pipeline infrastructure or operation of storage resources;
|
•
|
the effect of accounting pronouncements issued periodically by standard-setting bodies; and
|
•
|
other factors discussed elsewhere herein and in other reports (including the Form 10-K) filed by
the Company
from time to time with the SEC.
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
For the years ended
December 31,
|
||||||||||
|
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Operating Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||
Natural gas revenues (includes revenue taxes of
$32, $57, $103, and $133 for the periods presented, respectively) |
|
$
|
1,596
|
|
|
|
$
|
1,841
|
|
|
$
|
3,817
|
|
|
$
|
5,257
|
|
Other revenues
|
|
56
|
|
|
|
64
|
|
|
124
|
|
|
128
|
|
||||
Total operating revenues
|
|
1,652
|
|
|
|
1,905
|
|
|
3,941
|
|
|
5,385
|
|
||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of natural gas
|
|
613
|
|
|
|
755
|
|
|
1,617
|
|
|
2,729
|
|
||||
Cost of other sales
|
|
10
|
|
|
|
14
|
|
|
28
|
|
|
36
|
|
||||
Other operations and maintenance
|
|
482
|
|
|
|
454
|
|
|
928
|
|
|
939
|
|
||||
Depreciation and amortization
|
|
238
|
|
|
|
206
|
|
|
397
|
|
|
380
|
|
||||
Taxes other than income taxes
|
|
71
|
|
|
|
99
|
|
|
181
|
|
|
208
|
|
||||
Merger-related expenses
|
|
41
|
|
|
|
56
|
|
|
44
|
|
|
—
|
|
||||
Total operating expenses
|
|
1,455
|
|
|
|
1,584
|
|
|
3,195
|
|
|
4,292
|
|
||||
Gain on disposition of assets
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||
Operating Income
|
|
197
|
|
|
|
321
|
|
|
746
|
|
|
1,095
|
|
||||
Other Income and (Expense):
|
|
|
|
|
|
|
|
|
|
||||||||
Interest expense, net of amounts capitalized
|
|
(81
|
)
|
|
|
(96
|
)
|
|
(175
|
)
|
|
(182
|
)
|
||||
Earnings from equity method investments
|
|
60
|
|
|
|
2
|
|
|
6
|
|
|
8
|
|
||||
Other income (expense), net
|
|
14
|
|
|
|
5
|
|
|
9
|
|
|
9
|
|
||||
Total other income and (expense)
|
|
(7
|
)
|
|
|
(89
|
)
|
|
(160
|
)
|
|
(165
|
)
|
||||
Earnings Before Income Taxes
|
|
190
|
|
|
|
232
|
|
|
586
|
|
|
930
|
|
||||
Income taxes
|
|
76
|
|
|
|
87
|
|
|
213
|
|
|
350
|
|
||||
Income from continuing operations
|
|
114
|
|
|
|
145
|
|
|
373
|
|
|
580
|
|
||||
Loss from discontinued operations, net of tax
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
80
|
|
||||
Net Income
|
|
114
|
|
|
|
145
|
|
|
373
|
|
|
500
|
|
||||
Less: Net income attributable to noncontrolling interest
|
|
—
|
|
|
|
14
|
|
|
20
|
|
|
18
|
|
||||
Net Income Attributable to Southern Company Gas
|
|
$
|
114
|
|
|
|
$
|
131
|
|
|
$
|
353
|
|
|
$
|
482
|
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
For the years ended
December 31,
|
||||||||||
|
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Net Income
|
|
$
|
114
|
|
|
|
$
|
145
|
|
|
$
|
373
|
|
|
$
|
500
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
||||||||
Qualifying hedges:
|
|
|
|
|
|
|
|
|
|
||||||||
Changes in fair value, net of tax of
$(1), $(23), $(3), and $(2), respectively |
|
(1
|
)
|
|
|
(41
|
)
|
|
—
|
|
|
(6
|
)
|
||||
Reclassification adjustment for amounts included
in net income, net of tax of $-, $-, $1, and $(2), respectively |
|
—
|
|
|
|
1
|
|
|
8
|
|
|
(3
|
)
|
||||
Pension and other postretirement benefit plans:
|
|
|
|
|
|
|
|
|
|
||||||||
Benefit plan net gain (loss), net of tax of
$19, $-, $-, and $(48), respectively |
|
27
|
|
|
|
—
|
|
|
—
|
|
|
(71
|
)
|
||||
Reclassification adjustment for amounts included
in net income, net of tax of $-, $4, $9, and $5, respectively |
|
—
|
|
|
|
5
|
|
|
12
|
|
|
8
|
|
||||
Total other comprehensive income (loss)
|
|
26
|
|
|
|
(35
|
)
|
|
20
|
|
|
(72
|
)
|
||||
Less: Comprehensive income attributable to
noncontrolling interest
|
|
—
|
|
|
|
14
|
|
|
20
|
|
|
16
|
|
||||
Comprehensive Income Attributable
to Southern Company Gas
|
|
$
|
140
|
|
|
|
$
|
96
|
|
|
$
|
373
|
|
|
$
|
412
|
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
For the years ended
December 31,
|
||||||||||
|
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Operating Activities:
|
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
114
|
|
|
|
$
|
145
|
|
|
$
|
373
|
|
|
$
|
500
|
|
Adjustments to reconcile net income to net cash
provided from (used for) operating activities — |
|
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization, total
|
|
238
|
|
|
|
206
|
|
|
397
|
|
|
380
|
|
||||
Deferred income taxes
|
|
92
|
|
|
|
8
|
|
|
211
|
|
|
199
|
|
||||
Pension, postretirement, and other employee benefits
|
|
6
|
|
|
|
5
|
|
|
24
|
|
|
19
|
|
||||
Pension and postretirement funding
|
|
(125
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Stock based compensation expense
|
|
20
|
|
|
|
20
|
|
|
34
|
|
|
19
|
|
||||
Hedge settlements
|
|
(35
|
)
|
|
|
(26
|
)
|
|
—
|
|
|
—
|
|
||||
Goodwill impairment
|
|
—
|
|
|
|
—
|
|
|
14
|
|
|
—
|
|
||||
Mark-to-market adjustments
|
|
(3
|
)
|
|
|
162
|
|
|
22
|
|
|
(155
|
)
|
||||
Loss on discontinued operations, net of tax
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
80
|
|
||||
Other, net
|
|
(78
|
)
|
|
|
(82
|
)
|
|
43
|
|
|
(28
|
)
|
||||
Changes in certain current assets and liabilities —
|
|
|
|
|
|
|
|
|
|
||||||||
-Receivables
|
|
(490
|
)
|
|
|
181
|
|
|
615
|
|
|
(53
|
)
|
||||
-Natural gas for sale
|
|
(226
|
)
|
|
|
273
|
|
|
72
|
|
|
(58
|
)
|
||||
-Prepaid income taxes
|
|
(23
|
)
|
|
|
151
|
|
|
23
|
|
|
(175
|
)
|
||||
-Other current assets
|
|
(31
|
)
|
|
|
37
|
|
|
(11
|
)
|
|
44
|
|
||||
-Accounts payable
|
|
194
|
|
|
|
43
|
|
|
(434
|
)
|
|
25
|
|
||||
-Accrued taxes
|
|
8
|
|
|
|
41
|
|
|
(20
|
)
|
|
(66
|
)
|
||||
-Accrued compensation
|
|
(13
|
)
|
|
|
(21
|
)
|
|
(6
|
)
|
|
31
|
|
||||
-Other current liabilities
|
|
24
|
|
|
|
(30
|
)
|
|
24
|
|
|
(97
|
)
|
||||
Net cash used for operating activities
of discontinued operations |
|
—
|
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
||||
Net cash provided from (used for) operating activities
|
|
(328
|
)
|
|
|
1,113
|
|
|
1,381
|
|
|
655
|
|
||||
Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||
Property additions
|
|
(614
|
)
|
|
|
(509
|
)
|
|
(961
|
)
|
|
(702
|
)
|
||||
Cost of removal, net of salvage
|
|
(40
|
)
|
|
|
(32
|
)
|
|
(84
|
)
|
|
(39
|
)
|
||||
Change in construction payables, net
|
|
22
|
|
|
|
(7
|
)
|
|
18
|
|
|
(28
|
)
|
||||
Investment in unconsolidated subsidiaries
|
|
(1,444
|
)
|
|
|
(14
|
)
|
|
(12
|
)
|
|
(3
|
)
|
||||
Disposition of assets
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
230
|
|
||||
Other investing activities
|
|
9
|
|
|
|
3
|
|
|
12
|
|
|
50
|
|
||||
Net cash used for investing activities
of discontinued operations |
|
—
|
|
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
||||
Net cash used for investing activities
|
|
(2,067
|
)
|
|
|
(559
|
)
|
|
(1,027
|
)
|
|
(505
|
)
|
||||
Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||
Increase (decrease) in notes payable, net
|
|
1,143
|
|
|
|
(896
|
)
|
|
(165
|
)
|
|
4
|
|
||||
Proceeds —
|
|
|
|
|
|
|
|
|
|
||||||||
First mortgage bonds
|
|
—
|
|
|
|
250
|
|
|
—
|
|
|
—
|
|
||||
Capital contributions from parent company
|
|
1,085
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Senior notes
|
|
900
|
|
|
|
350
|
|
|
250
|
|
|
—
|
|
||||
Redemptions and repurchases —
|
|
|
|
|
|
|
|
|
|
||||||||
First mortgage bonds
|
|
—
|
|
|
|
(125
|
)
|
|
—
|
|
|
—
|
|
||||
Senior notes
|
|
(420
|
)
|
|
|
—
|
|
|
(200
|
)
|
|
—
|
|
||||
Distribution to noncontrolling interest
|
|
(15
|
)
|
|
|
(19
|
)
|
|
(18
|
)
|
|
(17
|
)
|
||||
Purchase of 15% noncontrolling interest in SouthStar
|
|
(160
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Payment of common stock dividends
|
|
(126
|
)
|
|
|
(128
|
)
|
|
(244
|
)
|
|
(233
|
)
|
||||
Other financing activities
|
|
(8
|
)
|
|
|
10
|
|
|
11
|
|
|
22
|
|
||||
Net cash provided from (used for) financing activities
|
|
2,399
|
|
|
|
(558
|
)
|
|
(366
|
)
|
|
(224
|
)
|
||||
Net Change in Cash and Cash Equivalents —
Continuing Operations
|
|
4
|
|
|
|
(4
|
)
|
|
(12
|
)
|
|
(51
|
)
|
||||
Net Change in Cash and Cash Equivalents —
Discontinued Operations
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
(23
|
)
|
||||
Cash and Cash Equivalents at Beginning of Period
|
|
15
|
|
|
|
19
|
|
|
31
|
|
|
105
|
|
||||
Cash and Cash Equivalents at End of Period
|
|
$
|
19
|
|
|
|
$
|
15
|
|
|
$
|
19
|
|
|
$
|
31
|
|
|
|
Successor
|
|
|
Predecessor
|
||||
Assets
|
|
December 31, 2016
|
|
|
December 31, 2015
|
||||
|
|
(in millions)
|
|
|
(in millions)
|
||||
Current Assets:
|
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
19
|
|
|
|
$
|
19
|
|
Receivables —
|
|
|
|
|
|
||||
Energy marketing receivable
|
|
623
|
|
|
|
445
|
|
||
Customer accounts receivable
|
|
364
|
|
|
|
316
|
|
||
Unbilled revenues
|
|
239
|
|
|
|
140
|
|
||
Other accounts and notes receivable
|
|
76
|
|
|
|
68
|
|
||
Accumulated provision for uncollectible accounts
|
|
(27
|
)
|
|
|
(29
|
)
|
||
Materials and supplies
|
|
26
|
|
|
|
29
|
|
||
Natural gas for sale
|
|
631
|
|
|
|
622
|
|
||
Prepaid income taxes
|
|
24
|
|
|
|
151
|
|
||
Prepaid expenses
|
|
55
|
|
|
|
67
|
|
||
Assets from risk management activities, net of collateral
|
|
128
|
|
|
|
206
|
|
||
Other regulatory assets, current
|
|
81
|
|
|
|
68
|
|
||
Other current assets
|
|
11
|
|
|
|
13
|
|
||
Total current assets
|
|
2,250
|
|
|
|
2,115
|
|
||
Property, Plant, and Equipment:
|
|
|
|
|
|
||||
In service
|
|
14,508
|
|
|
|
12,152
|
|
||
Less accumulated depreciation
|
|
4,439
|
|
|
|
2,775
|
|
||
Plant in service, net of depreciation
|
|
10,069
|
|
|
|
9,377
|
|
||
Construction work in progress
|
|
496
|
|
|
|
414
|
|
||
Total property, plant, and equipment
|
|
10,565
|
|
|
|
9,791
|
|
||
Other Property and Investments:
|
|
|
|
|
|
||||
Goodwill
|
|
5,967
|
|
|
|
1,813
|
|
||
Equity investments in unconsolidated subsidiaries
|
|
1,541
|
|
|
|
80
|
|
||
Other intangible assets, net of amortization of $34 and $68
at December 31, 2016 and December 31, 2015, respectively |
|
366
|
|
|
|
109
|
|
||
Miscellaneous property and investments
|
|
21
|
|
|
|
23
|
|
||
Total other property and investments
|
|
7,895
|
|
|
|
2,025
|
|
||
Deferred Charges and Other Assets:
|
|
|
|
|
|
||||
Other regulatory assets, deferred
|
|
973
|
|
|
|
670
|
|
||
Other deferred charges and assets
|
|
170
|
|
|
|
153
|
|
||
Total deferred charges and other assets
|
|
1,143
|
|
|
|
823
|
|
||
Total Assets
|
|
$
|
21,853
|
|
|
|
$
|
14,754
|
|
|
|
Successor
|
|
|
Predecessor
|
||||
Liabilities and Stockholders' Equity
|
|
December 31, 2016
|
|
|
December 31, 2015
|
||||
|
|
(in millions)
|
|
|
(in millions)
|
||||
Current Liabilities:
|
|
|
|
|
|
||||
Securities due within one year
|
|
$
|
22
|
|
|
|
$
|
545
|
|
Notes payable
|
|
1,257
|
|
|
|
1,010
|
|
||
Energy marketing trade payables
|
|
597
|
|
|
|
418
|
|
||
Accounts payable
|
|
348
|
|
|
|
255
|
|
||
Customer deposits
|
|
153
|
|
|
|
165
|
|
||
Accrued taxes —
|
|
|
|
|
|
||||
Accrued income taxes
|
|
26
|
|
|
|
13
|
|
||
Other accrued taxes
|
|
68
|
|
|
|
46
|
|
||
Accrued interest
|
|
48
|
|
|
|
49
|
|
||
Accrued compensation
|
|
58
|
|
|
|
92
|
|
||
Liabilities from risk management activities, net of collateral
|
|
62
|
|
|
|
44
|
|
||
Other regulatory liabilities, current
|
|
102
|
|
|
|
134
|
|
||
Accrued environmental remediation, current
|
|
69
|
|
|
|
67
|
|
||
Other current liabilities
|
|
108
|
|
|
|
162
|
|
||
Total current liabilities
|
|
2,918
|
|
|
|
3,000
|
|
||
Long-term Debt
(See notes)
|
|
5,259
|
|
|
|
3,275
|
|
||
Deferred Credits and Other Liabilities:
|
|
|
|
|
|
||||
Accumulated deferred income taxes
|
|
1,975
|
|
|
|
1,912
|
|
||
Employee benefit obligations
|
|
441
|
|
|
|
515
|
|
||
Other cost of removal obligations
|
|
1,616
|
|
|
|
1,538
|
|
||
Accrued environmental remediation, deferred
|
|
357
|
|
|
|
364
|
|
||
Other regulatory liabilities, deferred
|
|
51
|
|
|
|
53
|
|
||
Other deferred credits and liabilities
|
|
127
|
|
|
|
122
|
|
||
Total deferred credits and other liabilities
|
|
4,567
|
|
|
|
4,504
|
|
||
Total Liabilities
|
|
12,744
|
|
|
|
10,779
|
|
||
Common Stockholders' Equity
(See accompanying statements)
|
|
9,109
|
|
|
|
3,975
|
|
||
Total Liabilities and Stockholders' Equity
|
|
$
|
21,853
|
|
|
|
$
|
14,754
|
|
Commitments and Contingent Matters
(See notes)
|
|
|
|
|
|
|
Southern Company Gas Common Stockholders' Equity
|
|
|
|
||||||||||||||||||||||||||||
|
Number of Common Shares
|
|
Common Stock
|
|
|
|
Accumulated
Other
Comprehensive Income
(Loss) |
|
Noncontrolling
Interests
|
|
||||||||||||||||||||||
|
Issued
|
|
Treasury
|
|
Par Value
|
|
Paid-In Capital
|
|
Treasury
|
|
Retained Earnings
|
|
|
Total
|
||||||||||||||||||
|
(in thousands)
|
|
(in millions)
|
|||||||||||||||||||||||||||||
Predecessor –
Balance at December 31, 2013 |
118,889
|
|
|
217
|
|
|
$
|
595
|
|
|
$
|
2,054
|
|
|
$
|
(8
|
)
|
|
$
|
1,063
|
|
|
$
|
(136
|
)
|
|
$
|
45
|
|
$
|
3,613
|
|
Consolidated net income
attributable to
Southern Company Gas
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
482
|
|
|
—
|
|
|
—
|
|
482
|
|
|||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(70
|
)
|
|
(2
|
)
|
(72
|
)
|
|||||||
Stock issued
|
236
|
|
|
—
|
|
|
1
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
12
|
|
|||||||
Stock-based compensation
|
522
|
|
|
—
|
|
|
3
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
25
|
|
|||||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(233
|
)
|
|
—
|
|
|
—
|
|
(233
|
)
|
|||||||
Distribution to
noncontrolling interest
(*)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
(17
|
)
|
|||||||
Net income attributable
to noncontrolling interest
(*)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
18
|
|
|||||||
Predecessor –
Balance at December 31, 2014 |
119,647
|
|
|
217
|
|
|
599
|
|
|
2,087
|
|
|
(8
|
)
|
|
1,312
|
|
|
(206
|
)
|
|
44
|
|
3,828
|
|
|||||||
Consolidated net income
attributable to
Southern Company Gas
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
353
|
|
|
—
|
|
|
—
|
|
353
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20
|
|
|
—
|
|
20
|
|
|||||||
Stock issued
|
221
|
|
|
—
|
|
|
1
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
12
|
|
|||||||
Stock-based compensation
|
509
|
|
|
—
|
|
|
3
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
4
|
|
|||||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(244
|
)
|
|
—
|
|
|
—
|
|
(244
|
)
|
|||||||
Distribution to
noncontrolling interest
(*)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
(18
|
)
|
|||||||
Net income attributable
to noncontrolling interest
(*)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20
|
|
20
|
|
|||||||
Predecessor –
Balance at December 31, 2015 |
120,377
|
|
|
217
|
|
|
603
|
|
|
2,099
|
|
|
(8
|
)
|
|
1,421
|
|
|
(186
|
)
|
|
46
|
|
3,975
|
|
|||||||
Consolidated net income
attributable to
Southern Company Gas
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
131
|
|
|
—
|
|
|
—
|
|
131
|
|
|||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(35
|
)
|
|
—
|
|
(35
|
)
|
|||||||
Stock issued
|
95
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
6
|
|
|||||||
Stock-based compensation
|
270
|
|
|
—
|
|
|
2
|
|
|
28
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
30
|
|
|||||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(128
|
)
|
|
—
|
|
|
—
|
|
(128
|
)
|
|||||||
Reclassification of
noncontrolling interest
(*)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(46
|
)
|
(46
|
)
|
|||||||
Predecessor –
Balance at June 30, 2016 |
120,742
|
|
|
217
|
|
|
$
|
605
|
|
|
$
|
2,133
|
|
|
$
|
(8
|
)
|
|
$
|
1,424
|
|
|
$
|
(221
|
)
|
|
$
|
—
|
|
$
|
3,933
|
|
Successor –
Balance at July 1, 2016 |
—
|
|
|
—
|
|
|
—
|
|
|
8,001
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
8,001
|
|
|||||||
Consolidated net income
attributable to
Southern Company Gas
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
114
|
|
|
—
|
|
|
—
|
|
114
|
|
|||||||
Capital contributions from
parent company
|
—
|
|
|
—
|
|
|
—
|
|
|
1,085
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
1,085
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26
|
|
|
—
|
|
26
|
|
||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
9
|
|
|||||||
Cash dividends on common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(126
|
)
|
|
—
|
|
|
—
|
|
(126
|
)
|
|||||||
Successor –
Balance at December 31, 2016 |
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
9,095
|
|
|
$
|
—
|
|
|
$
|
(12
|
)
|
|
$
|
26
|
|
|
$
|
—
|
|
$
|
9,109
|
|
(*)
|
Associated with SouthStar. See Note 4 to the financial statements for additional information.
|
Note
|
|
Page
|
1
|
||
2
|
||
3
|
||
4
|
||
5
|
||
6
|
||
7
|
||
8
|
||
9
|
||
10
|
||
11
|
||
12
|
||
13
|
||
14
|
||
15
|
|
Successor
|
|
|
Predecessor
|
||||||
|
2016
|
|
|
2015
|
|
Note
|
||||
|
(in millions)
|
|
|
(in millions)
|
|
|
||||
Deferred income tax credits
|
$
|
(22
|
)
|
|
|
$
|
(27
|
)
|
|
(a)
|
Long-term debt fair value adjustment
|
154
|
|
|
|
66
|
|
|
(b)
|
||
Environmental remediation - asset
|
411
|
|
|
|
401
|
|
|
(h)
|
||
Under recovered regulatory clause revenues
|
118
|
|
|
|
69
|
|
|
(c)
|
||
Financial instrument hedging - asset
|
—
|
|
|
|
30
|
|
|
(d,h)
|
||
Other regulatory assets
|
58
|
|
|
|
47
|
|
|
(e)
|
||
Other cost of removal obligations
|
(1,616
|
)
|
|
|
(1,591
|
)
|
|
(a)
|
||
Financial instrument hedging - liability
|
(21
|
)
|
|
|
—
|
|
|
(d,h)
|
||
Other regulatory liabilities
|
(18
|
)
|
|
|
(20
|
)
|
|
(f)
|
||
Retiree benefit plans
|
325
|
|
|
|
125
|
|
|
(g,h)
|
||
Over recovered regulatory clause revenues
|
(104
|
)
|
|
|
(87
|
)
|
|
(c)
|
||
Total regulatory assets (liabilities), net
|
$
|
(715
|
)
|
|
|
$
|
(987
|
)
|
|
|
(a)
|
Deferred income tax assets and liabilities are amortized over the related property lives, which range up to
30 years
.
|
(b)
|
Recovered over the remaining life of the original debt issuances, which range up to
22 years
.
|
(c)
|
Recorded and recovered or amortized as approved or accepted by the applicable state regulatory agencies over periods not exceeding
nine years
.
|
(d)
|
Financial instrument-hedging assets and liabilities are recorded over the life of the underlying hedged purchase contracts, which generally do not exceed
two years
. Upon final settlement, actual costs incurred are recovered, and actual income earned is refunded through the energy cost recovery clause.
|
(e)
|
Comprised of several components including unamortized loss on reacquired debt, weather normalization, franchise gas, and deferred depreciation expense, which are recovered or amortized as approved by the applicable state regulatory agencies over periods generally not exceeding
ten years
.
|
(f)
|
Comprised of several components including energy efficiency programs and unamortized bond issuance costs which are recovered or amortized as approved by the applicable state regulatory agencies over periods generally not exceeding
four years
.
|
(g)
|
Recovered and amortized over the average remaining service period which range up to
11 years
. See Note 2 for additional information.
|
(h)
|
Not earning a return as offset in rate base by a corresponding asset or liability.
|
|
Successor
|
|
|
Predecessor
|
||||
|
2016
|
|
|
2015
|
||||
|
(in millions)
|
|
|
(in millions)
|
||||
Utility plant in service
|
$
|
11,996
|
|
|
|
$
|
9,912
|
|
Information technology equipment and software
|
324
|
|
|
|
415
|
|
||
Storage facilities
|
1,463
|
|
|
|
1,255
|
|
||
Other
|
725
|
|
|
|
570
|
|
||
Total other plant in service
|
2,512
|
|
|
|
2,240
|
|
||
Total plant in service
|
$
|
14,508
|
|
|
|
$
|
12,152
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years ended December 31,
|
||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||
Atlanta Gas Light
|
4.05
|
%
|
|
|
4.05
|
%
|
|
8.10
|
%
|
|
8.10
|
%
|
Chattanooga Gas
(*)
|
3.71
|
|
|
|
3.71
|
|
|
7.41
|
|
|
7.41
|
|
Elizabethtown Gas
(*)
|
0.84
|
|
|
|
0.84
|
|
|
1.69
|
|
|
0.44
|
|
Nicor Gas
(*)
|
1.50
|
|
|
|
1.50
|
|
|
0.82
|
|
|
0.24
|
|
(*)
|
Variable rate is determined by the FERC method of AFUDC accounting.
|
|
|
|
Successor - At December 31, 2016
|
||||||||||
|
Estimated Useful Life
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Other Intangible Assets, Net
|
||||||
|
|
|
(in millions)
|
||||||||||
Other intangible assets subject to amortization:
|
|
|
|
|
|
|
|
||||||
Gas marketing services
|
|
|
|
|
|
|
|
||||||
Customer relationships
|
11-14 years
|
|
$
|
221
|
|
|
$
|
(30
|
)
|
|
$
|
191
|
|
Trade names
|
10-28 years
|
|
115
|
|
|
(2
|
)
|
|
113
|
|
|||
Wholesale gas services
|
|
|
|
|
|
|
|
||||||
Storage and transportation contracts
|
1-5 years
|
|
64
|
|
|
(2
|
)
|
|
62
|
|
|||
Total intangible assets subject to amortization
|
|
|
$
|
400
|
|
|
$
|
(34
|
)
|
|
$
|
366
|
|
|
|
|
|
|
|
|
|
||||||
Goodwill:
|
|
|
|
|
|
|
|
||||||
Gas distribution operations
(*)
|
|
|
$
|
4,702
|
|
|
$
|
—
|
|
|
4,702
|
|
|
Gas marketing services
|
|
|
1,265
|
|
|
—
|
|
|
1,265
|
|
|||
Total goodwill
|
|
|
$
|
5,967
|
|
|
$
|
—
|
|
|
$
|
5,967
|
|
|
|
|
Predecessor - At December 31, 2015
|
||||||||||
|
Estimated Useful Life
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Other Intangible Assets, Net
|
||||||
|
|
|
(in millions)
|
||||||||||
Other intangible assets subject to amortization:
|
|
|
|
|
|
|
|
||||||
Gas marketing services
|
|
|
|
|
|
|
|
||||||
Customer relationships
|
11-14 years
|
|
$
|
132
|
|
|
$
|
(57
|
)
|
|
$
|
75
|
|
Trade names
|
10-28 years
|
|
45
|
|
|
(11
|
)
|
|
34
|
|
|||
Total intangible assets subject to amortization
|
|
|
$
|
177
|
|
|
$
|
(68
|
)
|
|
$
|
109
|
|
|
|
|
|
|
|
|
|
||||||
Goodwill:
|
|
|
|
|
|
|
|
||||||
Gas distribution operations
|
|
|
$
|
1,640
|
|
|
$
|
—
|
|
|
$
|
1,640
|
|
Gas marketing services
|
|
|
173
|
|
|
—
|
|
|
173
|
|
|||
Total goodwill
|
|
|
$
|
1,813
|
|
|
$
|
—
|
|
|
$
|
1,813
|
|
|
Amortization
|
||
|
(in millions)
|
||
2017
|
$
|
73
|
|
2018
|
58
|
|
|
2019
|
40
|
|
|
2020
|
28
|
|
|
2021
|
21
|
|
|
Amortization
|
||
|
(in millions)
|
||
2017
|
$
|
29
|
|
2018
|
24
|
|
|
2019
|
17
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 to December 31, 2016
|
|
|
January 1, 2016 to June 30, 2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Gas marketing services
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
4
|
|
Wholesale gas services
|
1
|
|
|
|
3
|
|
|
19
|
|
|
73
|
|
||||
All other
|
—
|
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Total
|
$
|
1
|
|
|
|
$
|
3
|
|
|
$
|
23
|
|
|
$
|
77
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||
Assumptions used to determine net periodic costs:
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||
Pension plans
|
|
|
|
|
|
|
|
|
||||
Discount rate – interest costs
(a)
|
3.21
|
%
|
|
|
4.00
|
%
|
|
4.20
|
%
|
|
5.00
|
%
|
Discount rate – service costs
(a)
|
4.07
|
|
|
|
4.80
|
|
|
4.20
|
|
|
5.00
|
|
Expected long-term return on plan assets
|
7.75
|
|
|
|
7.80
|
|
|
7.80
|
|
|
7.80
|
|
Annual salary increase
|
3.50
|
|
|
|
3.70
|
|
|
3.70
|
|
|
3.70
|
|
Pension band increase
(b)
|
2.00
|
|
|
|
2.00
|
|
|
2.00
|
|
|
2.00
|
|
Other postretirement benefit plans
|
|
|
|
|
|
|
|
|
|
|||
Discount rate – interest costs
(a)
|
2.84
|
%
|
|
|
3.60
|
%
|
|
4.00
|
%
|
|
4.70
|
%
|
Discount rate – service costs
(a)
|
3.96
|
|
|
|
4.70
|
|
|
4.00
|
|
|
4.70
|
|
Expected long-term return on plan assets
|
5.93
|
|
|
|
6.60
|
|
|
7.80
|
|
|
7.80
|
|
Annual salary increase
|
3.50
|
|
|
|
3.70
|
|
|
3.70
|
|
|
3.70
|
|
(a)
|
Effective January 1, 2016, the Company uses a spot rate approach to estimate the service cost and interest cost components. Previously, the Company estimated these components using a single weighted average discount rate.
|
(b)
|
Only applicable to Nicor Gas union employees. The pension bands for the former Nicor plan reflect the negotiated rates of
2.0%
for each of 2016 and 2017, in accordance with a March 2014 union agreement.
|
|
Successor
|
|
|
Predecessor
|
||
Assumptions used to determine benefit obligations:
|
December 31, 2016
|
|
|
December 31, 2015
|
||
Pension plans
|
|
|
|
|
||
Discount rate
|
4.39
|
%
|
|
|
4.6
|
%
|
Annual salary increase
|
3.50
|
|
|
|
3.7
|
|
Pension band increase
(*)
|
2.00
|
|
|
|
2.0
|
|
Other postretirement benefit plans
|
|
|
|
|
|
|
Discount rate
|
4.15
|
%
|
|
|
4.4
|
%
|
Annual salary increase
|
3.50
|
|
|
|
3.7
|
|
(*)
|
Only applicable to Nicor Gas union employees. The pension bands for the former Nicor plan reflect the negotiated rates of
2.0%
for each of 2016 and 2017, in accordance with a March 2014 union agreement.
|
|
Initial Cost Trend Rate
|
|
Ultimate Cost Trend Rate
|
|
Year That Ultimate Rate is Reached
|
||
Pre-65
|
6.60
|
%
|
|
4.50
|
%
|
|
2038
|
Post-65 medical
|
8.40
|
|
|
4.50
|
|
|
2038
|
Post-65 prescription
|
8.40
|
|
|
4.50
|
|
|
2038
|
|
1 Percent Increase
|
|
1 Percent Decrease
|
||||
|
(in millions)
|
||||||
Successor – December 31, 2016
|
|
|
|
||||
Benefit obligation
|
$
|
14
|
|
|
$
|
12
|
|
Service and interest costs
|
—
|
|
|
—
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
July 1, 2016 through December 31, 2016
|
|
|
January 1, 2016 through June 30, 2016
|
|
2015
|
||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||
Change in benefit obligation
|
|
|
|
|
|
|
||||||
Benefit obligation at beginning of period
|
$
|
1,244
|
|
|
|
$
|
1,067
|
|
|
$
|
1,098
|
|
Service cost
|
15
|
|
|
|
13
|
|
|
28
|
|
|||
Interest cost
|
20
|
|
|
|
21
|
|
|
45
|
|
|||
Benefits paid
|
(31
|
)
|
|
|
(26
|
)
|
|
(49
|
)
|
|||
Actuarial loss (gain)
|
(115
|
)
|
|
|
169
|
|
|
(55
|
)
|
|||
Balance at end of period
|
1,133
|
|
|
|
1,244
|
|
|
1,067
|
|
|||
Change in plan assets
|
|
|
|
|
|
|
||||||
Fair value of plan assets at beginning of period
|
837
|
|
|
|
847
|
|
|
906
|
|
|||
Actual return (loss) on plan assets
|
48
|
|
|
|
15
|
|
|
(12
|
)
|
|||
Employer contributions
|
129
|
|
|
|
1
|
|
|
2
|
|
|||
Benefits paid
|
(31
|
)
|
|
|
(26
|
)
|
|
(49
|
)
|
|||
Fair value of plan assets at end of period
|
983
|
|
|
|
837
|
|
|
847
|
|
|||
Accrued liability
|
$
|
150
|
|
|
|
$
|
407
|
|
|
$
|
220
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
2016
|
|
|
2015
|
||||
|
(in millions)
|
|
|
(in millions)
|
||||
Other regulatory assets, deferred
|
$
|
267
|
|
|
|
$
|
88
|
|
Other deferred charges and assets
|
58
|
|
|
|
78
|
|
||
Other current liabilities
|
(2
|
)
|
|
|
(4
|
)
|
||
Employee benefit obligations
|
(206
|
)
|
|
|
(294
|
)
|
|
Prior Service Cost
|
Net (Gain) Loss
|
||||
|
(in millions)
|
|||||
Successor – Balance at December 31, 2016:
|
|
|
||||
Accumulated OCI
|
$
|
—
|
|
$
|
(43
|
)
|
Regulatory assets (liabilities)
|
(2
|
)
|
269
|
|
||
Total
|
$
|
(2
|
)
|
$
|
226
|
|
|
|
|
||||
Predecessor – Balance at December 31, 2015:
|
|
|
||||
Accumulated OCI
|
$
|
(4
|
)
|
$
|
286
|
|
Regulatory assets
|
—
|
|
88
|
|
||
Total
|
$
|
(4
|
)
|
$
|
374
|
|
Estimated amortization in net periodic cost in 2017:
|
|
|
||||
Regulatory assets (liabilities)
|
$
|
1
|
|
$
|
(21
|
)
|
|
Accumulated OCI
|
|
Regulatory Assets
|
||||
|
(in millions)
|
||||||
Predecessor – Balance at December 31, 2014:
|
$
|
301
|
|
|
$
|
76
|
|
Net (gain) loss
|
—
|
|
|
22
|
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
2
|
|
|
—
|
|
||
Amortization of net loss
|
(21
|
)
|
|
(10
|
)
|
||
Total reclassification adjustments
|
(19
|
)
|
|
(10
|
)
|
||
Total change
|
(19
|
)
|
|
12
|
|
||
Predecessor – Balance at December 31, 2015:
|
$
|
282
|
|
|
$
|
88
|
|
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
1
|
|
|
—
|
|
||
Amortization of net loss
|
(9
|
)
|
|
(4
|
)
|
||
Total reclassification adjustments
|
(8
|
)
|
|
(4
|
)
|
||
Total change
|
(8
|
)
|
|
(4
|
)
|
||
Predecessor – Balance at June 30, 2016:
|
$
|
274
|
|
|
$
|
84
|
|
|
|
|
|
||||
|
|
|
|
||||
Successor – Balance at July 1, 2016:
|
$
|
—
|
|
|
$
|
368
|
|
Net (gain) loss
|
(43
|
)
|
|
(87
|
)
|
||
Reclassification adjustments:
|
|
|
|
||||
Amortization of prior service costs
|
—
|
|
|
1
|
|
||
Amortization of net loss
|
—
|
|
|
(15
|
)
|
||
Total reclassification adjustments
|
—
|
|
|
(14
|
)
|
||
Total change
|
(43
|
)
|
|
(101
|
)
|
||
Successor – Balance at December 31, 2016:
|
$
|
(43
|
)
|
|
$
|
267
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Service cost
|
$
|
15
|
|
|
|
$
|
13
|
|
|
$
|
28
|
|
|
$
|
24
|
|
Interest cost
|
20
|
|
|
|
21
|
|
|
45
|
|
|
47
|
|
||||
Expected return on plan assets
|
(35
|
)
|
|
|
(33
|
)
|
|
(65
|
)
|
|
(65
|
)
|
||||
Amortization of regulatory assets
|
13
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Amortization:
|
|
|
|
|
|
|
|
|
||||||||
Prior service costs
|
—
|
|
|
|
(1
|
)
|
|
(2
|
)
|
|
(2
|
)
|
||||
Net (gain)/loss
|
—
|
|
|
|
13
|
|
|
31
|
|
|
22
|
|
||||
Net periodic pension cost
|
$
|
13
|
|
|
|
$
|
13
|
|
|
$
|
37
|
|
|
$
|
26
|
|
|
Benefit Payments
|
||
|
(in millions)
|
||
2017
|
$
|
71
|
|
2018
|
72
|
|
|
2019
|
73
|
|
|
2020
|
74
|
|
|
2021
|
74
|
|
|
2022 to 2026
|
363
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
|
July 1, 2016 through December 31, 2016
|
|
|
January 1, 2016 through June 30, 2016
|
|
2015
|
||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||
Change in benefit obligation
|
|
|
|
|
|
|
||||||
Benefit obligation at beginning of period
|
$
|
338
|
|
|
|
$
|
318
|
|
|
$
|
334
|
|
Service cost
|
1
|
|
|
|
1
|
|
|
2
|
|
|||
Interest cost
|
5
|
|
|
|
5
|
|
|
13
|
|
|||
Benefits paid
|
(11
|
)
|
|
|
(11
|
)
|
|
(20
|
)
|
|||
Actuarial loss (gain)
|
(26
|
)
|
|
|
24
|
|
|
(13
|
)
|
|||
Retiree drug subsidy
|
—
|
|
|
|
—
|
|
|
1
|
|
|||
Employee contributions
|
1
|
|
|
|
1
|
|
|
1
|
|
|||
Balance at end of period
|
308
|
|
|
|
338
|
|
|
318
|
|
|||
Change in plan assets
|
|
|
|
|
|
|
||||||
Fair value of plan assets at beginning of period
|
100
|
|
|
|
99
|
|
|
99
|
|
|||
Actual return (loss) on plan assets
|
4
|
|
|
|
1
|
|
|
1
|
|
|||
Employee contributions
|
1
|
|
|
|
1
|
|
|
1
|
|
|||
Employer contributions
|
11
|
|
|
|
10
|
|
|
17
|
|
|||
Benefits paid
|
(11
|
)
|
|
|
(11
|
)
|
|
(20
|
)
|
|||
Retiree drug subsidy
|
—
|
|
|
|
—
|
|
|
1
|
|
|||
Fair value of plan assets at end of year
|
105
|
|
|
|
100
|
|
|
99
|
|
|||
Accrued liability
|
$
|
203
|
|
|
|
$
|
238
|
|
|
$
|
219
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
2016
|
|
|
2015
|
||||
|
(in millions)
|
|
|
(in millions)
|
||||
Other regulatory assets, deferred
|
$
|
52
|
|
|
|
$
|
30
|
|
Employee benefit obligations
|
(203
|
)
|
|
|
(219
|
)
|
|
Prior Service Cost
|
Net (Gain) Loss
|
||||
|
(in millions)
|
|||||
Successor – Balance at December 31, 2016:
|
|
|
||||
Accumulated OCI
|
$
|
—
|
|
$
|
(3
|
)
|
Regulatory assets (liabilities)
|
(12
|
)
|
64
|
|
||
Total
|
$
|
(12
|
)
|
$
|
61
|
|
|
|
|
||||
Predecessor – Balance at December 31, 2015:
|
|
|
||||
Accumulated OCI
|
$
|
—
|
|
$
|
36
|
|
Regulatory assets (liabilities)
|
(15
|
)
|
45
|
|
||
Total
|
$
|
(15
|
)
|
$
|
81
|
|
|
Accumulated OCI
|
Regulatory Assets
|
||||
|
(in millions)
|
|||||
Predecessor – Balance at December 31, 2014:
|
$
|
36
|
|
$
|
39
|
|
Net (gain) loss
|
2
|
|
(8
|
)
|
||
Reclassification adjustments:
|
|
|
||||
Amortization of prior service costs
|
—
|
|
2
|
|
||
Amortization of net loss
|
(2
|
)
|
(3
|
)
|
||
Total reclassification adjustments
|
(2
|
)
|
(1
|
)
|
||
Total change
|
—
|
|
(9
|
)
|
||
Predecessor – Balance at December 31, 2015:
|
$
|
36
|
|
$
|
30
|
|
Reclassification adjustments:
|
|
|
||||
Amortization of prior service costs
|
—
|
|
1
|
|
||
Amortization of net loss
|
(1
|
)
|
(1
|
)
|
||
Total reclassification adjustments
|
(1
|
)
|
—
|
|
||
Total change
|
(1
|
)
|
—
|
|
||
Predecessor – Balance at June 30, 2016:
|
$
|
35
|
|
$
|
30
|
|
|
|
|
||||
|
|
|
||||
Successor – Balance at July 1, 2016:
|
$
|
—
|
|
$
|
77
|
|
Net (gain) loss
|
(3
|
)
|
(23
|
)
|
||
Reclassification adjustments:
|
|
|
||||
Amortization of prior service costs
|
—
|
|
1
|
|
||
Amortization of net loss
|
—
|
|
(3
|
)
|
||
Total reclassification adjustments
|
—
|
|
(2
|
)
|
||
Total change
|
(3
|
)
|
(25
|
)
|
||
Successor – Balance at December 31, 2016:
|
$
|
(3
|
)
|
$
|
52
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Service cost
|
$
|
1
|
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
2
|
|
Interest cost
|
5
|
|
|
|
5
|
|
|
13
|
|
|
15
|
|
||||
Expected return on plan assets
|
(3
|
)
|
|
|
(3
|
)
|
|
(7
|
)
|
|
(7
|
)
|
||||
Amortization of regulatory assets
|
2
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Amortization:
|
|
|
|
|
|
|
|
|
||||||||
Prior service costs
|
—
|
|
|
|
(1
|
)
|
|
(3
|
)
|
|
(3
|
)
|
||||
Net (gain)/loss
|
—
|
|
|
|
2
|
|
|
6
|
|
|
6
|
|
||||
Net periodic postretirement benefit cost
|
$
|
5
|
|
|
|
$
|
4
|
|
|
$
|
11
|
|
|
$
|
13
|
|
|
Benefit Payments
|
||
|
(in millions)
|
||
2017
|
$
|
20
|
|
2018
|
20
|
|
|
2019
|
21
|
|
|
2020
|
22
|
|
|
2021
|
22
|
|
|
2022 to 2026
|
111
|
|
•
|
Domestic equity.
A mix of large and small capitalization stocks with generally an equal distribution of value and growth attributes, managed both actively and through passive index approaches.
|
•
|
International equity.
A mix of growth stocks and value stocks with both developed and emerging market exposure, managed both actively and through passive index approaches.
|
•
|
Fixed income.
A mix of domestic and international bonds.
|
•
|
Special situations.
Investments in opportunistic strategies with the objective of diversifying and enhancing returns and exploiting short-term inefficiencies as well as investments in promising new strategies of a longer-term nature.
|
•
|
Real estate investments.
Investments in traditional private market, equity-oriented investments in real properties (indirectly through pooled funds or partnerships) and in publicly traded real estate securities.
|
•
|
Private equity.
Investments in private partnerships that invest in private or public securities typically through privately-negotiated and/or structured transactions, including leveraged buyouts, venture capital, and distressed debt.
|
•
|
Domestic and international equity.
Investments in equity securities such as common stocks, American depositary receipts, and real estate investment trusts that trade on a public exchange are classified as Level 1 investments and are valued at the closing price in the active market. Equity investments with unpublished prices (i.e. pooled funds) are valued as Level 2, when the underlying holdings used to value the investment are comprised of Level 1 or Level 2 equity securities.
|
•
|
Fixed income.
Investments in fixed income securities are generally classified as Level 2 investments and are valued based on prices reported in the market place. Additionally, the value of fixed income securities takes into consideration certain items such as broker quotes, spreads, yield curves, interest rates, and discount rates that apply to the term of a specific instrument.
|
•
|
Real estate investments, private equity, and special situations investments.
Investments in real estate, private equity, and special situations are generally classified as Net Asset Value as a Practical Expedient, since the underlying assets typically do not have publicly available observable inputs. The fund manager values the assets using various inputs and techniques depending on the nature of the underlying investments. Techniques may include purchase multiples for comparable transactions, comparable public company trading multiples, discounted cash flow analysis, prevailing market
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices
in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
Successor – As of December 31, 2016
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
142
|
|
|
$
|
343
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
485
|
|
International equity
(*)
|
—
|
|
|
185
|
|
|
—
|
|
|
—
|
|
|
185
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury, government, and agency bonds
|
—
|
|
|
85
|
|
|
—
|
|
|
—
|
|
|
85
|
|
|||||
Corporate bonds
|
—
|
|
|
41
|
|
|
—
|
|
|
—
|
|
|
41
|
|
|||||
Pooled funds
|
—
|
|
|
66
|
|
|
—
|
|
|
—
|
|
|
66
|
|
|||||
Cash equivalents and other
|
12
|
|
|
5
|
|
|
—
|
|
|
83
|
|
|
100
|
|
|||||
Real estate investments
|
4
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
19
|
|
|||||
Private equity
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|||||
Total
|
$
|
158
|
|
|
$
|
725
|
|
|
$
|
—
|
|
|
$
|
100
|
|
|
$
|
983
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
|
Predecessor – As of December 31, 2015
|
|||||||||||||||||
|
|
Pension plans
(a)
|
|||||||||||||||||
In millions
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
% of total
|
|||||||||
Cash
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
—
|
%
|
Equity securities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
U.S. large cap
(b)
|
|
$
|
75
|
|
|
$
|
199
|
|
|
$
|
—
|
|
|
$
|
274
|
|
|
32
|
%
|
U.S. small cap
(b)
|
|
57
|
|
|
24
|
|
|
—
|
|
|
81
|
|
|
9
|
%
|
||||
International companies
(c)
|
|
—
|
|
|
125
|
|
|
—
|
|
|
125
|
|
|
15
|
%
|
||||
Emerging markets
(d)
|
|
—
|
|
|
28
|
|
|
—
|
|
|
28
|
|
|
3
|
%
|
||||
Total equity securities
|
|
$
|
132
|
|
|
$
|
376
|
|
|
$
|
—
|
|
|
$
|
508
|
|
|
59
|
%
|
Fixed income securities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Corporate bonds
(e)
|
|
$
|
—
|
|
|
$
|
91
|
|
|
$
|
—
|
|
|
$
|
91
|
|
|
11
|
%
|
Other (or gov't/muni bonds)
|
|
—
|
|
|
151
|
|
|
—
|
|
|
151
|
|
|
18
|
%
|
||||
Total fixed income securities
|
|
$
|
—
|
|
|
$
|
242
|
|
|
$
|
—
|
|
|
$
|
242
|
|
|
29
|
%
|
Other types of investments:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Global hedged equity
(f)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
40
|
|
|
$
|
40
|
|
|
5
|
%
|
Absolute return
(g)
|
|
—
|
|
|
—
|
|
|
42
|
|
|
42
|
|
|
5
|
%
|
||||
Private capital
(h)
|
|
—
|
|
|
—
|
|
|
20
|
|
|
20
|
|
|
2
|
%
|
||||
Total other investments
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
102
|
|
|
$
|
102
|
|
|
12
|
%
|
Total assets at fair value
|
|
$
|
136
|
|
|
$
|
618
|
|
|
$
|
102
|
|
|
$
|
856
|
|
|
100
|
%
|
% of fair value hierarchy
|
|
16
|
%
|
|
72
|
%
|
|
12
|
%
|
|
100
|
%
|
|
|
|
(a)
|
Includes
$9 million
at
December 31, 2015
of medical benefit (health and welfare) component for 401(h) accounts to fund a portion of the other retirement benefits.
|
(b)
|
Includes funds that invest primarily in U.S. common stocks.
|
(c)
|
Includes funds that invest primarily in foreign equity and equity-related securities.
|
(d)
|
Includes funds that invest primarily in common stocks of emerging markets.
|
(e)
|
Includes funds that invest primarily in investment grade debt and fixed income securities.
|
(f)
|
Includes funds that invest in limited/general partnerships, managed accounts, and other investment entities issued by non-traditional firms or "hedge funds."
|
(g)
|
Includes funds that invest primarily in investment vehicles and commodity pools as a "fund of funds."
|
(h)
|
Includes funds that invest in private equity and small buyout funds, partnership investments, direct investments, secondary investments, directly/indirectly in real estate and may invest in equity securities of real estate related companies, real estate mortgage loans, and real estate mezzanine loans.
|
|
Fair Value Measurements Using
|
|
|
||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets
|
|
Significant Other Observable Inputs
|
|
Significant Unobservable Inputs
|
|
Net Asset Value as a Practical Expedient
|
|
|
||||||||||
Successor – As of December 31, 2016
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic equity
(*)
|
$
|
3
|
|
|
$
|
58
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
61
|
|
International equity
(*)
|
—
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||
Fixed income:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Pooled funds
|
—
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|||||
Cash equivalents and other
|
1
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
3
|
|
|||||
Total
|
$
|
4
|
|
|
$
|
99
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
105
|
|
(*)
|
Level 1 securities consist of actively traded stocks while Level 2 securities consist of pooled funds. Management believes that the portfolio is well-diversified with no significant concentrations of risk.
|
|
|
Predecessor – As of December 31, 2015
|
|||||||||||||||||
|
|
Welfare plans
|
|||||||||||||||||
In millions
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
% of total
|
|||||||||
Cash
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
1
|
%
|
Equity securities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
U.S. large cap
(a)
|
|
$
|
—
|
|
|
$
|
52
|
|
|
$
|
—
|
|
|
$
|
52
|
|
|
58
|
%
|
U.S. small cap
(a)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||
International companies
(b)
|
|
—
|
|
|
15
|
|
|
—
|
|
|
15
|
|
|
17
|
%
|
||||
Emerging markets
(c)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||
Total equity securities
|
|
$
|
—
|
|
|
$
|
67
|
|
|
$
|
—
|
|
|
$
|
67
|
|
|
75
|
%
|
Fixed income securities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Corporate bonds
(d)
|
|
$
|
—
|
|
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
22
|
|
|
24
|
%
|
Other (or gov't/muni bonds)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||
Total fixed income securities
|
|
$
|
—
|
|
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
22
|
|
|
24
|
%
|
Other types of investments:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Global hedged equity
(e)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
%
|
Absolute return
(f)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||
Private capital
(g)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||
Total other investments
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
%
|
Total assets at fair value
|
|
$
|
1
|
|
|
$
|
89
|
|
|
$
|
—
|
|
|
$
|
90
|
|
|
100
|
%
|
% of fair value hierarchy
|
|
1
|
%
|
|
99
|
%
|
|
—
|
%
|
|
100
|
%
|
|
|
(a)
|
Includes funds that invest primarily in U.S. common stocks.
|
(b)
|
Includes funds that invest primarily in foreign equity and equity-related securities.
|
(c)
|
Includes funds that invest primarily in common stocks of emerging markets.
|
(d)
|
Includes funds that invest primarily in investment grade debt and fixed income securities.
|
(e)
|
Includes funds that invest in limited/general partnerships, managed accounts, and other investment entities issued by non-traditional firms or "hedge funds."
|
(f)
|
Includes funds that invest primarily in investment vehicles and commodity pools as a "fund of funds."
|
(g)
|
Includes funds that invest in private equity and small buyout funds, partnership investments, direct investments, secondary investments, directly/indirectly in real estate and may invest in equity securities of real estate related companies, real estate mortgage loans, and real estate mezzanine loans.
|
|
Successor
|
|
|
Predecessor
|
||||
|
December 31, 2016
|
|
|
December 31, 2015
|
||||
|
(in millions)
|
|
|
(in millions)
|
||||
Atlanta Gas Light
|
$
|
110
|
|
|
|
$
|
103
|
|
Virginia Natural Gas
|
11
|
|
|
|
12
|
|
||
Elizabethtown Gas
|
6
|
|
|
|
4
|
|
||
Nicor Gas
|
2
|
|
|
|
3
|
|
||
Total
|
$
|
129
|
|
|
|
$
|
122
|
|
Predecessor –
|
(in millions)
|
||
Balance at December 31, 2015
|
$
|
—
|
|
Reclassification of noncontrolling interest to contingently redeemable noncontrolling interest
|
46
|
|
|
Net income attributable to noncontrolling interest
|
14
|
|
|
Distribution to noncontrolling interest
|
(19
|
)
|
|
Balance at June 30, 2016
|
$
|
41
|
|
Successor –
|
(in millions)
|
||
Balance at July 1, 2016
|
$
|
174
|
|
Reclassification of contingently redeemable noncontrolling interest to mandatorily redeemable
noncontrolling interest |
(174
|
)
|
|
Balance at December 31, 2016
|
$
|
—
|
|
Balance Sheet Information
|
Successor
|
|
|
Predecessor
|
||||
|
December 31, 2016
|
|
|
December 31, 2015
|
||||
|
(in millions)
|
|
|
(in millions)
|
||||
SNG
|
$
|
1,394
|
|
|
|
$
|
—
|
|
Triton
|
44
|
|
|
|
49
|
|
||
Horizon Pipeline
|
30
|
|
|
|
14
|
|
||
PennEast Pipeline
|
22
|
|
|
|
9
|
|
||
Atlantic Coast Pipeline
|
33
|
|
|
|
7
|
|
||
Pivotal JAX LNG, LLC
|
16
|
|
|
|
—
|
|
||
Other
|
2
|
|
|
|
1
|
|
||
Total
|
$
|
1,541
|
|
|
|
$
|
80
|
|
Income Statement Information
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31, 2016
|
|
|
January 1, 2016 through June 30, 2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
SNG
|
$
|
56
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Triton
|
2
|
|
|
|
1
|
|
|
4
|
|
|
6
|
|
||||
Horizon Pipeline
|
1
|
|
|
|
1
|
|
|
2
|
|
|
2
|
|
||||
Atlantic Coast Pipeline
|
1
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
60
|
|
|
|
$
|
2
|
|
|
$
|
6
|
|
|
$
|
8
|
|
Balance Sheet Information
|
As of December 31, 2016
|
||
|
(in millions)
|
||
Current assets
|
$
|
95
|
|
Property, plant, and equipment
|
2,451
|
|
|
Deferred charges and other assets
|
129
|
|
|
Total Assets
|
$
|
2,675
|
|
|
|
||
Current liabilities
|
$
|
588
|
|
Long-term debt
|
706
|
|
|
Other deferred charges and other liabilities
|
22
|
|
|
Total Liabilities
|
$
|
1,316
|
|
|
|
||
Total Stockholders' Equity
|
1,359
|
|
|
Total Liabilities and Stockholders' Equity
|
$
|
2,675
|
|
Income Statement Information
|
September 1, 2016
through December 31, 2016 |
||
|
(in millions)
|
||
Revenues
|
$
|
230
|
|
Operating income
|
$
|
138
|
|
Net income
|
$
|
115
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Federal —
|
|
|
|
|
|
|
|
|
||||||||
Current
|
$
|
—
|
|
|
|
$
|
67
|
|
|
$
|
(13
|
)
|
|
$
|
111
|
|
Deferred
|
65
|
|
|
|
8
|
|
|
198
|
|
|
184
|
|
||||
|
65
|
|
|
|
75
|
|
|
185
|
|
|
295
|
|
||||
State —
|
|
|
|
|
|
|
|
|
||||||||
Current
|
(16
|
)
|
|
|
12
|
|
|
10
|
|
|
38
|
|
||||
Deferred
|
27
|
|
|
|
—
|
|
|
18
|
|
|
17
|
|
||||
|
11
|
|
|
|
12
|
|
|
28
|
|
|
55
|
|
||||
Total
|
$
|
76
|
|
|
|
$
|
87
|
|
|
$
|
213
|
|
|
$
|
350
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
2016
|
|
|
2015
|
||||
|
(in millions)
|
|
|
(in millions)
|
||||
Deferred tax liabilities —
|
|
|
|
|
||||
Accelerated depreciation
|
$
|
1,954
|
|
|
|
$
|
1,820
|
|
Property basis differences
|
311
|
|
|
|
283
|
|
||
Regulatory assets associated with employee benefit obligations
|
125
|
|
|
|
44
|
|
||
Other
|
164
|
|
|
|
215
|
|
||
Total
|
2,554
|
|
|
|
2,362
|
|
||
Deferred tax assets —
|
|
|
|
|
||||
Federal net operating loss
|
59
|
|
|
|
—
|
|
||
Federal effect of state deferred taxes
|
42
|
|
|
|
62
|
|
||
Employee benefit obligations
|
165
|
|
|
|
164
|
|
||
Other
|
332
|
|
|
|
212
|
|
||
Total
|
598
|
|
|
|
438
|
|
||
Less valuation allowances
|
(19
|
)
|
|
|
(19
|
)
|
||
Total, net of valuation allowances
|
579
|
|
|
|
419
|
|
||
Accumulated deferred income taxes, net
|
$
|
1,975
|
|
|
|
$
|
1,943
|
|
|
Successor
|
|
|
Predecessor
|
||||
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
Federal statutory rate
|
35.0%
|
|
|
35.0%
|
|
35.0%
|
|
35.0%
|
State income tax, net of federal
deduction |
4.0
|
|
|
3.5
|
|
3.4
|
|
3.8
|
Other
|
1.0
|
|
|
(0.9)
|
|
(2.0)
|
|
(1.2)
|
Effective income tax rate
|
40.0%
|
|
|
37.6%
|
|
36.4%
|
|
37.6%
|
Successor
|
||||||||||||||||||||||||
|
|
Expires
|
|
|
|
|
|
Expires Within One Year
|
||||||||||||||||
Company
|
|
2017
|
|
2018
|
|
Total
|
|
Unused
|
|
Term Out
|
|
No Term Out
|
||||||||||||
|
|
(in millions)
|
|
(in millions)
|
|
(in millions)
|
||||||||||||||||||
Southern Company Gas Capital
|
|
$
|
49
|
|
|
$
|
1,251
|
|
|
$
|
1,300
|
|
|
$
|
1,249
|
|
|
$
|
—
|
|
|
$
|
49
|
|
Nicor Gas
|
|
26
|
|
|
674
|
|
|
700
|
|
|
700
|
|
|
—
|
|
|
26
|
|
||||||
Total
|
|
$
|
75
|
|
|
$
|
1,925
|
|
|
$
|
2,000
|
|
|
$
|
1,949
|
|
|
$
|
—
|
|
|
$
|
75
|
|
|
Commercial Paper at the End of the Period
|
|||||
|
Amount
Outstanding
|
|
Weighted Average
Interest Rate
|
|||
|
(in millions)
|
|
|
|||
Successor – December 31, 2016:
|
|
|
|
|||
Southern Company Gas Capital
|
$
|
733
|
|
|
1.09
|
%
|
Nicor Gas
|
524
|
|
|
0.95
|
%
|
|
Total
|
$
|
1,257
|
|
|
1.03
|
%
|
|
|
|
|
|||
Predecessor – December 31, 2015:
|
|
|
|
|||
Southern Company Gas Capital
|
$
|
471
|
|
|
0.71
|
%
|
Nicor Gas
|
539
|
|
|
0.52
|
%
|
|
Total
|
$
|
1,010
|
|
|
0.60
|
%
|
|
Minimum Lease Payments
|
||
|
(in millions)
|
||
2017
|
$
|
18
|
|
2018
|
17
|
|
|
2019
|
16
|
|
|
2020
|
15
|
|
|
2021
|
15
|
|
|
2022 and thereafter
|
38
|
|
|
Total
|
$
|
119
|
|
•
|
Southern Company Gas' outstanding restricted stock units, restricted stock awards, and non-employee director stock awards were deemed fully vested and were canceled and converted into the right to receive an amount in cash equal to the product of (i) the total number of shares of Southern Company Gas' common stock subject to such award and (ii) the Merger consideration of
$66
per share;
|
•
|
Southern Company Gas' outstanding stock options, all of which were fully vested, were canceled and converted into the right to receive an amount in cash equal to the product of (i) the total number of shares of Southern Company Gas' common stock subject to such options and (ii) the excess of the Merger consideration of
$66
per share over the applicable exercise price per share of such options; and
|
•
|
each outstanding award of a performance share unit was converted into an award of Southern Company's restricted stock units (RSUs).
|
|
Fair Value Measurements Using
(a)(b)
|
|
|
||||||||||||||||
Successor –
As of December 31, 2016
|
Quoted Prices in Active Markets for Identical Assets
(Level 1) |
|
Significant Other Observable Inputs
(Level 2) |
|
Significant Unobservable Inputs
(Level 3) |
|
Net Asset Value as a Practical Expedient (NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
|
$
|
338
|
|
|
$
|
239
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
577
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
|
$
|
345
|
|
|
$
|
224
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
569
|
|
(a)
|
Energy-related derivatives excludes
$4 million
associated with certain weather derivatives accounted for based on intrinsic value rather than fair value.
|
(b)
|
Energy-related derivatives excludes cash collateral of
$62 million
.
|
|
Fair Value Measurements Using
(a)(b)
|
|
|
||||||||||||||||
Predecessor – As of December 31, 2015
|
Quoted Prices in Active Markets for Identical Assets
(Level 1) |
|
Significant Other Observable Inputs
(Level 2) |
|
Significant Unobservable Inputs
(Level 3) |
|
Net Asset Value as a Practical Expedient (NAV)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
|
$
|
53
|
|
|
$
|
113
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
166
|
|
Interest rate derivatives
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|||||
Total
|
$
|
53
|
|
|
$
|
122
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
175
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Energy-related derivatives
|
$
|
63
|
|
|
$
|
46
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
109
|
|
(a)
|
Energy-related derivatives excludes
$10 million
associated with certain weather derivatives accounted for based on intrinsic value rather than fair value.
|
(b)
|
Energy-related derivatives excludes cash collateral of
$96 million
.
|
|
Carrying
Amount
|
|
Fair
Value
|
||||
|
(in millions)
|
||||||
Long-term debt, including securities due within one year:
|
|
|
|
||||
Successor – As of December 31, 2016
|
$
|
5,281
|
|
|
$
|
5,491
|
|
Predecessor – As of December 31, 2015
|
$
|
3,820
|
|
|
$
|
4,066
|
|
•
|
Regulatory Hedges
— Energy-related derivative contracts which are designated as regulatory hedges relate primarily to the Company's fuel-hedging programs, where gains and losses are initially recorded as regulatory liabilities and assets, respectively, and then are included in the cost of natural gas as the underlying natural gas is used in operations and ultimately recovered through the respective cost recovery clauses.
|
•
|
Cash Flow Hedges
— Gains and losses on energy-related derivatives designated as cash flow hedges (which are mainly used to hedge anticipated purchases and sales) are initially deferred in other OCI before being recognized in the statements of income in the same period as the hedged transactions are reflected in earnings.
|
•
|
Not Designated
— Gains and losses on energy-related derivative contracts that are not designated or fail to qualify as hedges are recognized in the statements of income in the period of change.
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||||
|
|
Successor
|
|
|
Predecessor
|
|
Successor
|
|
|
Predecessor
|
||||||||
Derivative Category
|
Balance Sheet Location
|
December 31, 2016
|
|
|
December 31, 2015
|
Balance Sheet Location
|
December 31, 2016
|
|
|
December 31, 2015
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
|
(in millions)
|
|
|
(in millions)
|
||||||||
Derivatives designated as hedging instruments for regulatory purposes
|
|
|
|
|
|
|
|
|
|
|||||||||
Energy-related derivatives:
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Assets from risk management activities – current
|
$
|
24
|
|
|
|
$
|
10
|
|
Liabilities from risk management activities – current
|
$
|
3
|
|
|
|
$
|
28
|
|
|
Other deferred charges and assets
|
1
|
|
|
|
—
|
|
Other deferred credits and liabilities
|
—
|
|
|
|
2
|
|
||||
Total derivatives designated as hedging instruments for regulatory purposes
|
$
|
25
|
|
|
|
$
|
10
|
|
|
$
|
3
|
|
|
|
$
|
30
|
|
|
Derivatives designated as hedging instruments in cash flow and fair value hedges
|
|
|
|
|
|
|
|
|
|
|||||||||
Energy-related derivatives:
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Assets from risk management activities – current
|
$
|
4
|
|
|
|
$
|
3
|
|
Liabilities from risk management activities – current
|
$
|
3
|
|
|
|
$
|
5
|
|
|
Other deferred charges and assets
|
—
|
|
|
|
—
|
|
Other deferred credits and liabilities
|
—
|
|
|
|
2
|
|
||||
Interest rate derivatives:
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Assets from risk management activities – current
|
—
|
|
|
|
9
|
|
Liabilities from risk management activities – current
|
—
|
|
|
|
—
|
|
||||
Total derivatives designated as hedging instruments in cash flow and fair value hedges
|
$
|
4
|
|
|
|
$
|
12
|
|
|
$
|
3
|
|
|
|
$
|
7
|
|
|
Derivatives not designated as hedging instruments
|
|
|
|
|
|
|
|
|
|
|||||||||
Energy-related derivatives:
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Assets from risk management activities – current
|
$
|
486
|
|
|
|
$
|
741
|
|
Liabilities from risk management activities – current
|
$
|
482
|
|
|
|
$
|
644
|
|
|
Other deferred charges and assets
|
66
|
|
|
|
179
|
|
Other deferred credits and liabilities
|
81
|
|
|
|
185
|
|
||||
Total derivatives not designated as hedging instruments
|
$
|
552
|
|
|
|
$
|
920
|
|
|
$
|
563
|
|
|
|
$
|
829
|
|
|
Gross amounts of recognized assets and liabilities
(a)(b)
|
$
|
581
|
|
|
|
$
|
942
|
|
|
$
|
569
|
|
|
|
$
|
866
|
|
|
Gross amounts offset in the Balance Sheet
|
$
|
(435
|
)
|
|
|
$
|
(724
|
)
|
|
$
|
(497
|
)
|
|
|
$
|
(820
|
)
|
|
Net amounts of derivatives assets and liabilities, presented in the Balance Sheet
(c)
|
$
|
146
|
|
|
|
$
|
218
|
|
|
$
|
72
|
|
|
|
$
|
46
|
|
(a)
|
The gross amounts of recognized assets and liabilities are netted on the balance sheets to the extent that there were netting arrangements with the counterparties.
|
(b)
|
The gross amounts of recognized assets and liabilities do not include cash collateral held on deposit in broker margin accounts of
$62 million
as of
December 31, 2016
and
$96 million
as of
December 31, 2015
.
|
(c)
|
As of
December 31, 2016
and 2015, letters of credit from counterparties offset an immaterial portion of these assets under master netting arrangements.
|
|
|
Unrealized Losses
|
|
|
Unrealized Gains
|
||||||||||||||
|
|
Successor
|
|
|
Predecessor
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
Derivative Category
|
Balance Sheet Location
|
December 31, 2016
|
|
|
December 31, 2015
|
|
Balance Sheet Location
|
December 31, 2016
|
|
|
December 31, 2015
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
|
|
(in millions)
|
|
|
(in millions)
|
||||||||
Energy-related derivatives:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Other regulatory assets, current
|
$
|
(1
|
)
|
|
|
$
|
(15
|
)
|
|
Other regulatory liabilities, current
|
$
|
17
|
|
|
|
$
|
15
|
|
|
Other regulatory assets, deferred
|
—
|
|
|
|
(2
|
)
|
|
Other regulatory liabilities, deferred
|
1
|
|
|
|
—
|
|
||||
Total energy-related derivative gains (losses)
(*)
|
$
|
(1
|
)
|
|
|
$
|
(17
|
)
|
|
|
$
|
18
|
|
|
|
$
|
15
|
|
(*)
|
Fair value gains and losses included in regulatory assets and liabilities include cash collateral held on deposit in broker margin accounts of
$8 million
as of
December 31, 2016
and
$19 million
as of
December 31, 2015
.
|
|
Gain (Loss) Recognized in OCI on Derivative
(Effective Portion)
|
|
|
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
||||||||||||||
|
Successor
|
|
|
Predecessor
|
|
|
Successor
|
|
|
Predecessor
|
||||||||
Derivatives in Cash Flow Hedging Relationships
|
July 1, 2016 through December 31, 2016
|
|
|
January 1, 2016 through June 30, 2016
|
|
Statements of Income Location
|
July 1, 2016 through December 31, 2016
|
|
|
January 1, 2016 through June 30, 2016
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
|
|
(in millions)
|
|
|
(in millions)
|
||||||||
Energy-related derivatives
|
$
|
2
|
|
|
|
$
|
—
|
|
|
Cost of natural gas
|
$
|
(1
|
)
|
|
|
$
|
(1
|
)
|
Interest rate derivatives
|
(5
|
)
|
|
|
(64
|
)
|
|
Interest expense, net of amounts capitalized
|
—
|
|
|
|
—
|
|
||||
Total derivatives in cash flow
hedging relationships |
$
|
(3
|
)
|
|
|
$
|
(64
|
)
|
|
|
$
|
(1
|
)
|
|
|
$
|
(1
|
)
|
|
Gain (Loss) Recognized in OCI on Derivative (Effective Portion)
|
|
|
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
||||||||||||||
|
Predecessor
|
|
|
Predecessor
|
||||||||||||||
Derivatives in Cash Flow Hedging Relationships
|
2015
|
|
|
2014
|
|
Statements of Income Location
|
2015
|
|
|
2014
|
||||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||||||||
Energy-related derivatives
|
$
|
3
|
|
|
|
$
|
(8
|
)
|
|
Cost of natural gas
|
$
|
(10
|
)
|
|
|
$
|
4
|
|
|
|
|
|
|
|
Other operations and maintenance
|
(1
|
)
|
|
|
1
|
|
||||||
Interest rate derivatives
|
—
|
|
|
|
—
|
|
|
Interest expense, net of amounts capitalized
|
2
|
|
|
|
—
|
|
||||
Total derivatives in cash flow
hedging relationships |
$
|
3
|
|
|
|
$
|
(8
|
)
|
|
|
$
|
(9
|
)
|
|
|
$
|
5
|
|
|
|
Gain (Loss)
|
|||||||||||||||
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
|
July 1, 2016 through December 31,
|
|
|
January 1, 2016 through June 30,
|
|
Years Ended December 31,
|
||||||||||
Derivatives in Non-Designated Hedging Relationships
|
Statements of Income Location
|
2016
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||
|
|
(in millions)
|
|
|
(in millions)
|
||||||||||||
Energy-related derivatives
|
Natural gas revenues
(*)
|
$
|
33
|
|
|
|
$
|
(1
|
)
|
|
$
|
56
|
|
|
$
|
149
|
|
|
Cost of natural gas
|
3
|
|
|
|
(62
|
)
|
|
(6
|
)
|
|
(7
|
)
|
||||
Total derivatives in non-designated hedging relationships
|
$
|
36
|
|
|
|
$
|
(63
|
)
|
|
$
|
50
|
|
|
$
|
142
|
|
(*)
|
Excludes gains (losses) recorded in cost of natural gas associated with weather derivatives of
$6 million
for the successor periods of
July 1, 2016 through December 31, 2016
and
$3 million
,
$12 million
, and
$(7) million
for the predecessor periods of
January 1, 2016 through June 30, 2016
and the years ended
December 31, 2015
and
2014
, respectively.
|
|
Successor
|
|
|
Predecessor
|
|
|
||||||
|
New Basis
|
|
|
Old Basis
|
|
Change in Basis
|
||||||
|
(in millions)
|
|
|
(in millions)
|
||||||||
Current assets
|
$
|
1,557
|
|
|
|
$
|
1,474
|
|
|
$
|
83
|
|
Property, plant, and equipment
|
10,108
|
|
|
|
10,148
|
|
|
(40
|
)
|
|||
Goodwill
|
5,967
|
|
|
|
1,813
|
|
|
4,154
|
|
|||
Other intangible assets
|
400
|
|
|
|
101
|
|
|
299
|
|
|||
Regulatory assets
|
1,118
|
|
|
|
679
|
|
|
439
|
|
|||
Other assets
|
229
|
|
|
|
273
|
|
|
(44
|
)
|
|||
Current liabilities
|
(2,201
|
)
|
|
|
(2,205
|
)
|
|
4
|
|
|||
Other liabilities
|
(4,742
|
)
|
|
|
(4,600
|
)
|
|
(142
|
)
|
|||
Long-term debt
|
(4,261
|
)
|
|
|
(3,709
|
)
|
|
(552
|
)
|
|||
Contingently redeemable noncontrolling interest
|
(174
|
)
|
|
|
(41
|
)
|
|
(133
|
)
|
|||
Total purchase price/equity
|
$
|
8,001
|
|
|
|
$
|
3,933
|
|
|
$
|
4,068
|
|
•
|
rate credits of
$18 million
to be paid to customers in New Jersey and Maryland;
|
•
|
sharing of Merger savings with customers in Georgia starting in 2020;
|
•
|
phasing-out the use of the Nicor name or logo by certain of the Company's gas marketing services subsidiaries in conducting non-utility business in Illinois;
|
•
|
reaffirming that Elizabethtown Gas would file a base rate case no later than September 1, 2016, with another base rate case no later than
three years
after the 2016 rate case; and
|
•
|
requiring Elkton Gas to file a base rate case within
two years
of closing the Merger.
|
|
Gas Distribution Operations
|
|
Gas Marketing Services
|
|
Wholesale Gas Services
(*)
|
|
Gas Midstream Operations
|
|
Total
|
|
All Other
|
|
Eliminations
|
|
Consolidated
|
||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||
Successor – July 1, 2016 through December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Operating revenues
|
$
|
1,342
|
|
|
$
|
354
|
|
|
$
|
24
|
|
|
$
|
31
|
|
|
$
|
1,751
|
|
|
$
|
3
|
|
|
$
|
(102
|
)
|
|
$
|
1,652
|
|
Depreciation and
amortization |
185
|
|
|
35
|
|
|
1
|
|
|
9
|
|
|
230
|
|
|
8
|
|
|
—
|
|
|
238
|
|
||||||||
Earnings from equity
method investments |
—
|
|
|
—
|
|
|
—
|
|
|
58
|
|
|
58
|
|
|
2
|
|
|
—
|
|
|
60
|
|
||||||||
Interest expense
|
(105
|
)
|
|
(1
|
)
|
|
(3
|
)
|
|
(16
|
)
|
|
(125
|
)
|
|
44
|
|
|
—
|
|
|
(81
|
)
|
||||||||
Income taxes
|
51
|
|
|
7
|
|
|
(3
|
)
|
|
16
|
|
|
71
|
|
|
5
|
|
|
—
|
|
|
76
|
|
||||||||
Segment net income
(loss) |
77
|
|
|
19
|
|
|
—
|
|
|
20
|
|
|
116
|
|
|
(2
|
)
|
|
—
|
|
|
114
|
|
||||||||
Gross property
additions |
561
|
|
|
5
|
|
|
1
|
|
|
54
|
|
|
621
|
|
|
11
|
|
|
—
|
|
|
632
|
|
||||||||
Successor – Total
assets at December 31, 2016 |
19,453
|
|
|
2,084
|
|
|
1,127
|
|
|
2,211
|
|
|
24,875
|
|
|
11,145
|
|
|
(14,167
|
)
|
|
21,853
|
|
(*)
|
The revenues for wholesale gas services are netted with costs associated with its energy and risk management activities. A reconciliation of operating revenues and intercompany revenues is shown in the following table.
|
|
Gas Distribution Operations
|
|
Gas Marketing Services
|
|
Wholesale Gas Services
(*)
|
|
Gas Midstream Operations
|
|
Total
|
|
All Other
|
|
Eliminations
|
|
Consolidated
|
||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||
Predecessor – January 1, 2016 through June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Operating revenues
|
$
|
1,575
|
|
|
$
|
435
|
|
|
$
|
(32
|
)
|
|
$
|
25
|
|
|
$
|
2,003
|
|
|
$
|
4
|
|
|
$
|
(102
|
)
|
|
$
|
1,905
|
|
Depreciation and
amortization |
178
|
|
|
11
|
|
|
1
|
|
|
9
|
|
|
199
|
|
|
7
|
|
|
—
|
|
|
206
|
|
||||||||
EBIT
|
353
|
|
|
109
|
|
|
(68
|
)
|
|
(6
|
)
|
|
388
|
|
|
(60
|
)
|
|
—
|
|
|
328
|
|
||||||||
Gross property additions
|
484
|
|
|
4
|
|
|
1
|
|
|
43
|
|
|
532
|
|
|
16
|
|
|
—
|
|
|
548
|
|
||||||||
Predecessor – Year Ended December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Operating revenues
|
$
|
3,049
|
|
|
$
|
835
|
|
|
$
|
202
|
|
|
$
|
55
|
|
|
$
|
4,141
|
|
|
$
|
11
|
|
|
$
|
(211
|
)
|
|
$
|
3,941
|
|
Depreciation and
amortization |
336
|
|
|
25
|
|
|
1
|
|
|
18
|
|
|
380
|
|
|
17
|
|
|
—
|
|
|
397
|
|
||||||||
EBIT
|
581
|
|
|
152
|
|
|
110
|
|
|
(23
|
)
|
|
820
|
|
|
(59
|
)
|
|
—
|
|
|
761
|
|
||||||||
Gross property additions
|
957
|
|
|
7
|
|
|
2
|
|
|
27
|
|
|
993
|
|
|
34
|
|
|
—
|
|
|
1,027
|
|
||||||||
Predecessor – Total
assets at December 31, 2015 |
12,519
|
|
|
686
|
|
|
935
|
|
|
692
|
|
|
14,832
|
|
|
9,662
|
|
|
(9,740
|
)
|
|
14,754
|
|
||||||||
Predecessor – Year Ended December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Operating revenues
|
$
|
4,001
|
|
|
$
|
994
|
|
|
$
|
578
|
|
|
$
|
88
|
|
|
5,661
|
|
|
$
|
7
|
|
|
$
|
(283
|
)
|
|
$
|
5,385
|
|
|
Depreciation and
amortization |
317
|
|
|
28
|
|
|
1
|
|
|
18
|
|
|
364
|
|
|
16
|
|
|
—
|
|
|
380
|
|
||||||||
EBIT
|
582
|
|
|
132
|
|
|
425
|
|
|
(17
|
)
|
|
1,122
|
|
|
(10
|
)
|
|
—
|
|
|
1,112
|
|
||||||||
Gross property additions
|
715
|
|
|
11
|
|
|
2
|
|
|
15
|
|
|
743
|
|
|
26
|
|
|
—
|
|
|
769
|
|
||||||||
Predecessor – Total
assets at December 31, 2014 |
12,038
|
|
|
670
|
|
|
1,402
|
|
|
694
|
|
|
14,804
|
|
|
9,705
|
|
|
(9,647
|
)
|
|
14,862
|
|
(*)
|
The revenues for wholesale gas services are netted with costs associated with its energy and risk management activities. A reconciliation of operating revenues and intercompany revenues is shown in the following table.
|
|
Third Party Gross Revenues
|
|
Intercompany Revenues
|
|
Total Gross Revenues
|
|
Less Gross Gas Costs
|
|
Operating Revenues
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Successor – July 1, 2016 through
December 31, 2016 |
$
|
5,807
|
|
|
$
|
333
|
|
|
$
|
6,140
|
|
|
$
|
6,116
|
|
|
$
|
24
|
|
|
(in millions)
|
||||||||||||||||||
Predecessor – January 1, 2016 through
June 30, 2016 |
$
|
2,500
|
|
|
$
|
143
|
|
|
$
|
2,643
|
|
|
$
|
2,675
|
|
|
$
|
(32
|
)
|
Year Ended December 31, 2015
|
6,286
|
|
|
408
|
|
|
6,694
|
|
|
6,492
|
|
|
202
|
|
|||||
Year Ended December 31, 2014
|
10,709
|
|
|
718
|
|
|
11,427
|
|
|
10,849
|
|
|
578
|
|
|
Year Ended December 31, 2014
|
||
|
(in millions)
|
||
Operating revenues
|
$
|
243
|
|
Operating expenses
|
|
|
|
Cost of goods sold
|
149
|
|
|
Operation and maintenance
|
75
|
|
|
Depreciation and amortization
|
5
|
|
|
Taxes other than income taxes
|
5
|
|
|
Loss on sale and goodwill impairment
(*)
|
28
|
|
|
Total operating expenses
|
262
|
|
|
Operating (loss) income
|
(19
|
)
|
|
(Loss) income before income taxes
|
(19
|
)
|
|
Income tax expense
|
(61
|
)
|
|
(Loss) income from discontinued operations, net of tax
|
$
|
(80
|
)
|
(*)
|
Primarily reflects
$7 million
due to the suspension of depreciation and amortization during 2014 and
$19 million
of goodwill attributable to Tropical Shipping that was impaired in 2014, based on the negotiated sales price.
|
|
Successor
|
|
|
Predecessor
|
|
Successor
|
|
|
Predecessor
|
||||||
|
2016
|
|
|
2015
|
|
2016
|
|
|
2015
|
||||||
|
(in millions)
|
|
|
(in millions)
|
|
(percent of total)
|
|
|
(percent of total)
|
||||||
Long-Term Debt:
|
|
|
|
|
|
|
|
|
|
||||||
Long-term notes payable —
|
|
|
|
|
|
|
|
|
|
||||||
1.47% to 9.10% due 2016-2046
(a)
|
$
|
3,887
|
|
|
|
$
|
3,181
|
|
|
|
|
|
|
||
Other long-term debt —
|
|
|
|
|
|
|
|
|
|
||||||
First mortgage bonds —
|
|
|
|
|
|
|
|
|
|
||||||
2.66% to 6.58% due 2016-2038
(b)
|
625
|
|
|
|
375
|
|
|
|
|
|
|
||||
Gas facility revenue bonds —
|
|
|
|
|
|
|
|
|
|
||||||
Variable rate (1.28% at 1/1/17) due 2022-2033
|
200
|
|
|
|
200
|
|
|
|
|
|
|
||||
Total other long-term debt
|
825
|
|
|
|
575
|
|
|
|
|
|
|
||||
Unamortized fair value adjustment of long-term debt
|
578
|
|
|
|
68
|
|
|
|
|
|
|
||||
Unamortized debt discount
|
(9
|
)
|
|
|
(4
|
)
|
|
|
|
|
|
||||
Total long-term debt (annual interest requirement — $207 million)
|
5,281
|
|
|
|
3,820
|
|
|
|
|
|
|
||||
Less amount due within one year
|
22
|
|
|
|
545
|
|
|
|
|
|
|
||||
Long-term debt excluding amount due within one year
|
5,259
|
|
|
|
3,275
|
|
|
36.6
|
%
|
|
|
45.2
|
%
|
||
Common Stockholder's Equity:
|
|
|
|
|
|
|
|
|
|
||||||
Common stock — 2016: par value $0.01 per share
|
|
|
|
|
|
|
|
|
|
||||||
— 2015 par value $5 per share
|
|
|
|
|
|
|
|
|
|
||||||
Authorized — 2016: 100 million shares
|
|
|
|
|
|
|
|
|
|
||||||
— 2015: 750 million shares
|
|
|
|
|
|
|
|
|
|
||||||
Outstanding — 2016: 100 shares
|
|
|
|
|
|
|
|
|
|
||||||
— 2015: 120.4 million shares
|
|
|
|
|
|
|
|
|
|
||||||
Treasury — 2016: no shares
|
|
|
|
|
|
|
|
|
|
||||||
— 2015: 0.2 million shares
|
|
|
|
|
|
|
|
|
|
||||||
Paid-in capital
|
9,095
|
|
|
|
2,702
|
|
|
|
|
|
|
||||
Treasury, at cost
|
—
|
|
|
|
(8
|
)
|
|
|
|
|
|
||||
Retained earnings (accumulated deficit)
|
(12
|
)
|
|
|
1,421
|
|
|
|
|
|
|
||||
Accumulated other comprehensive income (loss)
|
26
|
|
|
|
(186
|
)
|
|
|
|
|
|
||||
Total common stockholder's equity
|
9,109
|
|
|
|
3,929
|
|
|
63.4
|
|
|
|
54.2
|
|
||
Noncontrolling interest
|
—
|
|
|
|
46
|
|
|
—
|
|
|
|
0.6
|
|
||
Total stockholders' equity
|
9,109
|
|
|
|
3,975
|
|
|
|
|
|
|
||||
Total Capitalization
|
$
|
14,368
|
|
|
|
$
|
7,250
|
|
|
100.0
|
%
|
|
|
100.0
|
%
|
(a)
|
Long-term notes payable maturities are as follows:
$22 million
in
2017
(
7.20%
);
$155 million
in
2018
(
3.50%
);
$300 million
in
2019
(
5.25%
);
$330 million
in
2021
(
3.50%
to
9.10%
); and
$3.1 billion
in
2022
-
2046
(
2.45%
to
8.70%
).
|
(b)
|
First mortgage bonds maturities are as follows:
$50 million
in
2019
(
4.70%
) and
$575 million
in
2023
-
2038
(
2.66%
to
6.58%
).
|
|
Successor
|
|
|
Predecessor
|
||||||||||||||||||||
|
July 1, 2016 through December 31, 2016
|
|
|
January 1, 2016 through June 30, 2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Operating Revenues (in millions)
|
$
|
1,652
|
|
|
|
$
|
1,905
|
|
|
$
|
3,941
|
|
|
$
|
5,385
|
|
|
$
|
4,209
|
|
|
$
|
3,562
|
|
Income From Continuing
Operations (in millions) |
$
|
114
|
|
|
|
$
|
145
|
|
|
$
|
373
|
|
|
$
|
580
|
|
|
$
|
308
|
|
|
$
|
274
|
|
Net Income Attributable to
Southern Company Gas (in millions) |
$
|
114
|
|
|
|
$
|
131
|
|
|
$
|
353
|
|
|
$
|
482
|
|
|
$
|
295
|
|
|
$
|
260
|
|
Cash Dividends on Common Stock
(in millions) |
$
|
126
|
|
|
|
$
|
128
|
|
|
$
|
244
|
|
|
$
|
233
|
|
|
$
|
222
|
|
|
$
|
203
|
|
Return on Average Common Equity
(percent) |
1.74
|
|
|
|
3.31
|
|
|
9.05
|
|
|
12.96
|
|
|
8.42
|
|
|
7.77
|
|
||||||
Total Assets (in millions)
|
$
|
21,853
|
|
|
|
$
|
14,488
|
|
|
$
|
14,754
|
|
|
$
|
14,888
|
|
|
$
|
14,528
|
|
|
$
|
14,051
|
|
Gross Property Additions
(in millions) |
$
|
632
|
|
|
|
$
|
548
|
|
|
$
|
1,027
|
|
|
$
|
769
|
|
|
$
|
731
|
|
|
$
|
775
|
|
Capitalization (in millions):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Common stock equity
|
$
|
9,109
|
|
|
|
$
|
3,933
|
|
|
$
|
3,975
|
|
|
$
|
3,828
|
|
|
$
|
3,613
|
|
|
$
|
3,391
|
|
Long-term debt
|
5,259
|
|
|
|
3,709
|
|
|
3,275
|
|
|
3,581
|
|
|
3,791
|
|
|
3,307
|
|
||||||
Total (excluding amounts due within
one year) |
$
|
14,368
|
|
|
|
$
|
7,642
|
|
|
$
|
7,250
|
|
|
$
|
7,409
|
|
|
$
|
7,404
|
|
|
$
|
6,698
|
|
Capitalization Ratios (percent):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Common stock equity
|
63.4
|
|
|
|
51.5
|
|
|
54.8
|
|
|
51.7
|
|
|
48.8
|
|
|
50.6
|
|
||||||
Long-term debt
|
36.6
|
|
|
|
48.5
|
|
|
45.2
|
|
|
48.3
|
|
|
51.2
|
|
|
49.4
|
|
||||||
Total (excluding amounts due within
one year) |
100.0
|
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
|
100.0
|
|
||||||
Service Contracts (year-end)
|
1,198,263
|
|
|
|
1,197,096
|
|
|
1,205,476
|
|
|
1,162,065
|
|
|
1,176,908
|
|
|
673,506
|
|
||||||
Customers (year-end)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gas distribution operations
|
4,586,477
|
|
|
|
4,544,489
|
|
|
4,557,729
|
|
|
4,529,114
|
|
|
4,504,067
|
|
|
4,477,986
|
|
||||||
Gas marketing services
|
655,999
|
|
|
|
630,475
|
|
|
654,475
|
|
|
633,460
|
|
|
632,337
|
|
|
608,711
|
|
||||||
Total (year-end)
|
5,242,476
|
|
|
|
5,174,964
|
|
|
5,212,204
|
|
|
5,162,574
|
|
|
5,136,404
|
|
|
5,086,697
|
|
||||||
Employees (year-end)
|
5,292
|
|
|
|
5,284
|
|
|
5,203
|
|
|
5,165
|
|
|
6,094
|
|
|
6,121
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||||||||||
|
July 1, 2016 through December 31, 2016
|
|
|
January 1, 2016 through June 30, 2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Operating Revenues (in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Residential
|
$
|
899
|
|
|
|
$
|
1,101
|
|
|
$
|
2,129
|
|
|
$
|
2,877
|
|
|
$
|
2,422
|
|
|
$
|
2,011
|
|
Commercial
|
260
|
|
|
|
310
|
|
|
617
|
|
|
861
|
|
|
696
|
|
|
656
|
|
||||||
Transportation
|
269
|
|
|
|
290
|
|
|
526
|
|
|
458
|
|
|
487
|
|
|
474
|
|
||||||
Industrial
|
74
|
|
|
|
72
|
|
|
203
|
|
|
242
|
|
|
180
|
|
|
262
|
|
||||||
Other
|
150
|
|
|
|
132
|
|
|
466
|
|
|
947
|
|
|
424
|
|
|
159
|
|
||||||
Total
|
$
|
1,652
|
|
|
|
$
|
1,905
|
|
|
$
|
3,941
|
|
|
$
|
5,385
|
|
|
$
|
4,209
|
|
|
$
|
3,562
|
|
Heating Degree Days:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Illinois
|
1,903
|
|
|
|
3,340
|
|
|
5,433
|
|
|
6,556
|
|
|
6,305
|
|
|
4,863
|
|
||||||
Georgia
|
727
|
|
|
|
1,448
|
|
|
2,204
|
|
|
2,882
|
|
|
2,689
|
|
|
1,934
|
|
||||||
Gas Sales Volumes
(mmBtu in millions): |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gas distributions operations
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Firm
|
274
|
|
|
|
396
|
|
|
695
|
|
|
766
|
|
|
720
|
|
|
606
|
|
||||||
Interruptible
|
47
|
|
|
|
49
|
|
|
99
|
|
|
106
|
|
|
111
|
|
|
107
|
|
||||||
Total
|
321
|
|
|
|
445
|
|
|
794
|
|
|
872
|
|
|
831
|
|
|
713
|
|
||||||
Gas marketing services
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Firm:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Georgia
|
13
|
|
|
|
21
|
|
|
35
|
|
|
41
|
|
|
38
|
|
|
31
|
|
||||||
Illinois
|
4
|
|
|
|
8
|
|
|
13
|
|
|
17
|
|
|
9
|
|
|
8
|
|
||||||
Other emerging markets
|
5
|
|
|
|
7
|
|
|
11
|
|
|
10
|
|
|
8
|
|
|
8
|
|
||||||
Interruptible (large commercial and
industrial) |
6
|
|
|
|
8
|
|
|
14
|
|
|
17
|
|
|
18
|
|
|
17
|
|
||||||
Total
|
28
|
|
|
|
44
|
|
|
73
|
|
|
85
|
|
|
73
|
|
|
64
|
|
||||||
Market share in Georgia (percent)
|
29.4
|
|
|
|
29.3
|
|
|
29.7
|
|
|
30.6
|
|
|
31.4
|
|
|
32.1
|
|
||||||
Wholesale gas services
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Daily physical sales (
mmBtu in
millions/day ) |
7.2
|
|
|
|
7.6
|
|
|
6.8
|
|
|
6.3
|
|
|
5.7
|
|
|
5.5
|
|
Item 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
(1)
|
Ages listed are as of December 31, 2016.
|
(2)
|
No position other than director.
|
S. W. Connally, Jr.
Chairman, President, and Chief Executive Officer
Age 47
Served as Executive Officer since 2012
|
Michael L. Burroughs
Vice President — Senior Production Officer
Age 56
Served as Executive Officer since 2010
|
Jim R. Fletcher
Vice President — External Affairs and Corporate Services
Age 50
Served as Executive Officer since 2014
|
Wendell E. Smith
Vice President — Power Delivery
Age 51
Served as Executive Officer since 2014
|
Xia Liu
Vice President and Chief Financial Officer
Age 46
Served as Executive Officer since 2015
|
Bentina C. Terry
Vice President — Customer Service and Sales
Age 46
Served as Executive Officer since 2007
|
(1)
|
Ages listed are as of December 31, 2016.
|
Item 11.
|
EXECUTIVE COMPENSATION
|
COMPENSATION DISCUSSION AND ANALYSIS (CD&A)
|
|
In this CD&A and this Form 10-K, references to the "Compensation Committee" are to the Compensation and Management Succession Committee of the Board of Directors of Southern Company.
|
|
This section describes the compensation program for Gulf Power's Chief Executive Officer and Chief Financial Officer in 2016, as well as each of its other three most highly compensated executive officers serving at the end of the year. Collectively, these officers are referred to as the named executive officers.
|
|
|
|
S. W. Connally, Jr.
|
Chairman, President, and Chief Executive Officer
|
Xia Liu
|
Vice President and Chief Financial Officer
|
Jim R. Fletcher
|
Vice President
|
Wendell E. Smith
|
Vice President
|
Bentina C. Terry
|
Vice President
|
|
Salary ($)
(1)
|
% of Total
|
Annual Cash Incentive Award ($)
(2)
|
% of Total
|
Long-term Equity Incentive Award ($)
(3)
|
% of Total
|
S. W. Connally, Jr.
|
453,521
|
26%
|
510,624
|
29%
|
805,355
|
45%
|
X. Liu
|
281,309
|
42%
|
220,461
|
33%
|
169,904
|
25%
|
J. R. Fletcher
|
252,461
|
42%
|
202,464
|
33%
|
148,596
|
25%
|
W. E. Smith
|
218,707
|
48%
|
158,447
|
34%
|
84,719
|
18%
|
B. C. Terry
|
284,498
|
42%
|
219,620
|
32%
|
173,191
|
26%
|
•
|
Business unit financial and operational performance and Southern Company earnings per share (EPS), based on actual results as adjusted by the Compensation Committee, compared to target performance levels established early in the year, determine the actual payouts under the annual cash incentive award program (Performance Pay Program).
|
•
|
Southern Company's total shareholder return (TSR) compared to those of industry peers, cumulative EPS, and equity-weighted return on equity (ROE) over a three-year period lead to higher or lower payouts under the long-term equity incentive award program (Performance Share Program).
|
Financial: 187% of Target
|
Operational: 161% of Target
|
EPS: 171% of Target
|
1-Year: 9.9%
|
3-Year: 11.2%
|
5-year: 5.9%
|
•
|
Employees' commitment and performance have a significant impact on achieving business results;
|
•
|
Compensation and benefits offered must attract, retain, and engage employees and must be financially sustainable;
|
•
|
Compensation should be consistent with performance: higher pay for higher performance and lower pay for lower performance; and
|
•
|
Both business drivers and culture should influence the compensation and benefit program.
|
•
|
Be competitive with Gulf Power's industry peers;
|
•
|
Reward achievement of Gulf Power's goals;
|
•
|
Be aligned with the interests of Southern Company's stockholders and Gulf Power's customers; and
|
•
|
Not encourage excessive risk-taking.
|
•
|
Retention by the Compensation Committee of an independent compensation consultant, Pay Governance LLC (Pay Governance), that provides no other services to Gulf Power or Southern Company.
|
•
|
Inclusion of a claw-back provision that permits the Compensation Committee to recoup performance pay from any employee if determined to have been based on erroneous results, and requires recoupment from an executive officer in the event of a material financial restatement due to fraud or misconduct of the executive officer.
|
•
|
Provision of limited perquisites with no income tax gross-ups for the Chairman, President, and Chief Executive Officer, except on certain relocation-related benefits.
|
Establishing Executive Compensation
|
ESTABLISHING MARKET-BASED COMPENSATION LEVELS
|
American Electric Power Company, Inc.
|
Duke Energy Corporation
|
NRG Energy, Inc.
|
Ameren Corporation
|
Edison International
|
PG&E Corporation
|
Berkshire Hathaway Energy Company
|
Energy Transfer Partners, L.P.
|
PPL Corporation
|
Calpine Corporation
|
Entergy Corporation
|
Public Service Enterprise Group, Inc.
|
CenterPoint Energy, Inc.
|
Exelon Corporation
|
Sempra Energy
|
CMS Energy Corporation
|
FirstEnergy Corp.
|
Tennessee Valley Authority
|
Consolidated Edison, Inc.
|
Kinder Morgan, Inc.
|
The AES Corporation
|
Direct Energy
|
Monroe Energy LLC
|
The Williams Companies
|
Dominion Resources, Inc.
|
NextEra Energy, Inc.
|
UGI Corporation
|
DTE Energy Company
|
NiSource Inc.
|
Xcel Energy
|
AGL Resources Inc.
|
Exelon Corporation
|
PNM Resources Inc.
|
Allete, Inc.
|
FirstEnergy Corp.
|
Portland General Electric Company
|
Alliant Energy Corporation
|
First Solar Inc.
|
PPL Corporation
|
Ameren Corporation
|
GE Energy
|
Public Service Enterprise Group Inc.
|
American Electric Power Company, Inc.
|
GE Oil & Gas
|
Puget Sound Energy, Inc.
|
American Water Works Company, Inc.
|
Genesis Energy
|
Questar Corporation
|
Areva Inc.
|
Idaho Power Company
|
Sacramento Municipal Utility District
|
Atmos Energy Corporation
|
ITC Holdings
|
Salt River Project
|
Avista Corporation
|
JEA
|
SCANA Corporation
|
Black Hills Corporation
|
Kinder Morgan Energy Partners, L.P.
|
ShawCor Ltd.
|
Boardwalk Pipeline Partners, L.P.
|
LG&E and KU Energy LLC
|
Sempra Energy
|
Bonneville Power Administration
|
Lower Colorado River Authority
|
Southwest Gas Corporation
|
Calpine Corporation
|
MDU Resources Group, Inc.
|
Spectra Energy Corp.
|
CenterPoint Energy, Inc.
|
Monroe Energy
|
Talen Energy
|
Cleco Corporation
|
National Grid USA
|
TECO Energy, Inc.
|
CMS Energy Corporation
|
New York Power Authority
|
Tennessee Valley Authority
|
Covanta Corporation
|
NextEra Energy, Inc.
|
The AES Corporation
|
CPS Energy
|
NorthWestern Corporation
|
The Williams Companies, Inc.
|
Direct Energy
|
NOVA Chemicals Corporation
|
TransCanada Corporation
|
Dominion Resources, Inc.
|
NRG Energy, Inc.
|
Tri-State Generation & Transmission Association, Inc.
|
DTE Energy Company
|
OGE Energy Corp.
|
|
Duke Energy Corporation
|
Oglethorpe Power Corporation
|
UGI Corporation
|
Edison International
|
Old Dominion Electric
|
UIL Holdings
|
Enable Midstream Partners
|
Omaha Public Power District
|
UNS Energy Corporation
|
Energy Future Holdings Corp.
|
Oncor Electric Delivery Company LLC
|
Vectren Corporation
|
Energy Transfer Partners, L.P.
|
ONE Gas, Inc.
|
Westar Energy, Inc.
|
EnLink Midstream
|
ONEOK, Inc.
|
WEC Energy Group, Inc.
|
Entergy Corporation
|
Pacific Gas & Electric Company
|
Xcel Energy Inc.
|
EQT Corporation
|
Pinnacle West Capital Corporation
|
|
•
|
Short-term compensation
|
◦
|
Base salary
|
◦
|
Performance Pay Program
|
•
|
Long-term compensation
|
◦
|
Performance Share Program
|
•
|
Benefits
|
•
|
Continuing industry-leading reliability and customer satisfaction, while maintaining reasonable retail prices;
|
•
Rewards achievement of annual performance goals; performance results can range from 0 to 200% of target, based on actual level of goal achievement
◦
EPS: earned at 171% of target
◦
Net Income: earned at 187% of target
◦
Operations: earned at 161% of target
•
2016 Payout: Exceeded target performance
◦
Chief Executive Officer payout at 171% of target
◦
Other named executive officers' payouts at 173% of target
|
•
|
Business Unit Financial Goal: Net Income
|
•
|
Business Unit Operational Goals: Varies by business unit
|
•
|
Southern Company Financial Goal: EPS
|
•
|
Individual Performance Goals for the Chief Executive Officer
|
Operational Goals
|
Description
|
Why It Is Important
|
Customer Satisfaction
|
Customer satisfaction surveys evaluate performance. The survey results provide an overall ranking for each traditional electric operating company, including Gulf Power, as well as a ranking for each customer segment: residential, commercial, and industrial.
|
Customer satisfaction is key to operations. Performance of all operational goals affects customer satisfaction.
|
Safety
|
Southern Company's Target Zero program is focused on continuous improvement in striving for a safe work environment. The performance is measured by the applicable company's ranking, as compared to peer utilities in the Southeastern Electric Exchange.
|
Essential for the protection of employees, customers, and communities.
|
Culture
|
The culture goal seeks to improve Gulf Power's inclusive workplace. This goal includes measures for work environment (employee satisfaction survey), representation of minorities and females in leadership roles (subjectively assessed), and supplier diversity.
|
Supports workforce development efforts and helps to assure diversity of suppliers.
|
Reliability
|
Transmission and distribution system reliability performance is measured by the frequency and duration of outages. Performance targets for reliability are set internally based on recent historical performance.
|
Reliably delivering power to customers is essential to Gulf Power's operations.
|
Availability
|
Peak season equivalent forced outage rate is an indicator of availability and efficient generation fleet operations during the months when generation needs are greatest. Availability is measured as a percentage of the hours of forced outages out of the total generation hours.
|
Availability of sufficient power during peak season fulfills the obligation to serve and provide customers with the least cost generating resources.
|
Financial Performance Goals
|
Description
|
Why It Is Important
|
EPS
|
Southern Company's net income from ongoing business activities divided by average shares outstanding during the year.
|
Supports commitment to provide Southern Company's stockholders solid, risk-adjusted returns and to support and grow the dividend.
|
Net Income
|
For the traditional electric operating companies, including Gulf Power, the business unit financial performance goal is net income after dividends on preferred and preference stock.
Overall corporate performance is determined by the equity-weighted average of the business unit net income goal payouts.
|
Supports delivery of Southern Company stockholder value and contributes to Gulf Power's and Southern Company's sound financial policies and stable credit ratings.
|
Individual Performance Goals (Mr. Connally only)
|
Description
|
Why It Is Important
|
Individual Factors
|
Focus on overall business performance as well as factors including leadership development, succession planning, and fostering the culture and diversity of the organization.
|
Individual goals provide the Compensation Committee the ability to balance quantitative results with qualitative inputs by focusing on both business performance and behavioral aspects of leadership that lead to sustainable long-term growth.
|
Level of Performance
|
Gulf Power
Net Income
($, in millions)
|
Southern Company
EPS ($)
|
Maximum
|
132.4
|
2.96
|
Target
|
118.8
|
2.82
|
Threshold
|
105.1
|
2.68
|
Goal
|
Achievement
|
Customer Satisfaction
|
Maximum
|
Safety
|
Below target
|
Culture
|
Above target
|
Reliability
|
Significantly above target
|
Availability
|
Maximum
|
Total Gulf Power Operational Goal Performance Factor
|
161%
|
Goal
|
Result
|
Achievement Percentage (%)
|
Gulf Power Net Income (in millions)*
|
$130.7
|
187
|
Southern Company EPS (from ongoing business activities)*
|
$2.89
|
171
|
•
|
EPS:
Southern Company's adjusted EPS result was $2.89, exceeding the $2.82 target. The adjusted EPS result excludes the impact of charges related to the Kemper IGCC, equity return related to the Kemper IGCC schedule extension, and earnings, acquisition costs, integration costs, and financing costs related to Southern Company Gas, PowerSecure, and Southern Natural Gas. This is consistent with the earnings results publicly communicated to investors.
|
•
|
Net Income:
Gulf Power's adjusted net income result was $130.7 million, exceeding the $118.8 million target. The adjusted result excludes the impact of integration costs.
|
|
Southern Company EPS Result
(%)
|
Business Unit Financial Goal Result
(%)
|
Business Unit Operational Goal Result (%)
|
Individual Goal Result (%)
|
Total Performance Factor
(%)
|
S. W. Connally, Jr.
|
171
|
187
|
161
|
150
|
171
|
X. Liu
|
171
|
187
|
161
|
N/A
|
173
|
J. R. Fletcher
|
171
|
187
|
161
|
N/A
|
173
|
W. E. Smith
|
171
|
187
|
161
|
N/A
|
173
|
B. C. Terry
|
171
|
187
|
161
|
N/A
|
173
|
|
Target Annual Performance Pay Program Opportunity
(% of base salary)
|
Target Annual
Performance
Pay Program
Opportunity ($)
|
Total
Performance
Factor
(% of target)
|
Actual Annual
Performance
Pay Program
Payout ($)
|
S. W. Connally, Jr.
|
65
|
299,135
|
171
|
510,624
|
X. Liu
|
45
|
127,434
|
173
|
220,461
|
J. R. Fletcher
|
45
|
117,031
|
173
|
202,464
|
W. E. Smith
|
40
|
91,588
|
173
|
158,447
|
B. C. Terry
|
45
|
126,948
|
173
|
219,620
|
•
Long-term performance-based awards are intended to promote long-term success and increase stockholder value by directly tying a substantial portion of the named executive officers' total compensation to the interests of Southern Company stockholders.
•
Performance shares represent 100% of long-term target value
◦
TSR relative to industry peers (50%)
◦
Cumulative three-year EPS (25%)
◦
Equity-weighted ROE (25%)
•
Three-year performance period from 2016 through 2018
•
Performance results can range from 0 to 200% of target
•
Paid in Common Stock at the end of the performance period; accrued dividends only received if and when award is earned
|
|
Relative TSR Performance
(50% weighting)
|
Cumulative EPS Performance
(25% weighting)
|
Equity-Weighted ROE Performance
(25% weighting)
|
Payout
(% of Performance Share Units Paid)
|
Maximum
|
90th percentile or higher
|
$9.37
|
6.1%
|
200%
|
Target
|
50th percentile
|
$8.85
|
4.9%
|
100%
|
Threshold
|
10th percentile
|
$8.34
|
4.5%
|
0%
|
Alliant Energy Corporation
|
Eversource Energy
|
Ameren Corporation
|
OGE Energy Corporation
|
American Electric Power Company, Inc.
|
PG&E Corporation
|
CMS Energy Corporation
|
Pinnacle West Capital Corporation
|
Consolidated Edison, Inc.
|
PPL Corporation
|
DTE Energy Company
|
SCANA Corporation
|
Duke Energy Corporation
|
Westar Energy Inc.
|
Edison International
|
WEC Energy Group, Inc.
|
Entergy Corporation
|
Xcel Energy Inc.
|
|
Target Value (% of base salary)
|
Relative TSR
(50%)
|
Cumulative EPS
(25%)
|
Equity-Weighted ROE (25%)
|
Total Long-Term Grant
|
||||
|
Grant Date Fair Value ($)
|
Target Number of Shares (#)
|
Grant Date Fair Value ($)
|
Target Number of Shares (#)
|
Grant Date Fair Value ($)
|
Target Number of Shares (#)
|
Grant Date Fair Value ($)
|
Target Number of Shares (#)
|
|
S. W. Connally, Jr.
|
175
|
402,688
|
8,911
|
201,334
|
4,124
|
201,334
|
4,124
|
805,355
|
17,159
|
X. Liu
|
60
|
84,957
|
1,880
|
42,473
|
870
|
42,473
|
870
|
169,904
|
3,620
|
J. R. Fletcher
|
60
|
74,292
|
1,644
|
37,152
|
761
|
37,152
|
761
|
148,596
|
3,166
|
W. E. Smith
|
40
|
42,343
|
937
|
21,188
|
434
|
21,188
|
434
|
84,719
|
1,805
|
B. C. Terry
|
60
|
86,584
|
1,916
|
43,303
|
887
|
43,303
|
887
|
173,191
|
3,690
|
Alliant Energy Corporation
|
Eversource Energy
|
Ameren Corporation
|
PG&E Corporation
|
American Electric Power Company, Inc.
|
Pinnacle West Capital Corporation
|
CMS Energy Corporation
|
PPL Corporation
|
Consolidated Edison, Inc.
|
SCANA Corporation
|
DTE Energy Company
|
WEC Energy Group, Inc.
|
Duke Energy Corporation
|
Xcel Energy Inc.
|
Edison International
|
|
|
Target Performance Shares Granted (#)
|
Grant Date Target Value of Performance Shares ($)
|
Performance Shares Earned (#)
|
Value of Performance Shares Earned ($)
|
S. W. Connally, Jr.
|
8,274
|
310,606
|
0
|
0
|
X. Liu
|
2,320
|
87,093
|
0
|
0
|
J. R. Fletcher
|
1,350
|
50,679
|
0
|
0
|
W. E. Smith
|
748
|
28,080
|
0
|
0
|
B. C. Terry
|
2,608
|
97,904
|
0
|
0
|
Executive Stock Ownership Requirements
|
Clawback of Awards
|
Policy Regarding Hedging and Pledging of Common Stock
|
COMPENSATION COMMITTEE REPORT
|
Name and Principal
Position
(a)
|
Year
(b)
|
Salary
($)
(c)
|
Bonus
($)
(d)
|
Stock
Awards
($)
(e)
|
Option
Awards
($)
(f)
|
Non-Equity
Incentive
Plan
Compensation
($)
(g)
|
Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings
($)
(h)
|
All Other
Compensation
($)
(i)
|
Total
($)
(j)
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
S. W. Connally, Jr.
President, Chief Executive Officer, and Director
|
2016
|
453,521
|
|
—
|
|
805,355
|
|
—
|
|
510,624
|
|
536,810
|
|
24,523
|
|
2,330,833
|
|
2015
|
420,758
|
|
—
|
|
553,946
|
|
—
|
|
391,000
|
|
160,338
|
|
30,485
|
|
1,556,527
|
|
|
2014
|
393,907
|
|
—
|
|
310,606
|
|
207,086
|
|
339,302
|
|
496,800
|
|
25,948
|
|
1,773,649
|
|
|
X. Liu
Vice President and Chief Financial Officer
|
2016
|
281,309
|
|
—
|
|
169,904
|
|
—
|
|
220,461
|
|
187,312
|
|
20,897
|
|
879,883
|
|
2015
|
265,380
|
|
—
|
|
154,865
|
|
—
|
|
188,996
|
|
59,936
|
|
283,417
|
|
952,594
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
J. R. Fletcher
|
2016
|
252,461
|
|
—
|
|
148,596
|
|
—
|
|
202,464
|
|
259,385
|
|
34,822
|
|
897,728
|
|
Vice President
|
2015
|
238,711
|
|
—
|
|
144,315
|
|
—
|
|
169,891
|
|
48,436
|
|
120,417
|
|
721,770
|
|
|
2014
|
224,547
|
|
25,045
|
|
50,679
|
|
33,801
|
|
149,633
|
|
273,148
|
|
89,971
|
|
846,824
|
|
W. E. Smith
|
2016
|
218,707
|
|
5,000
|
|
84,719
|
|
—
|
|
158,447
|
|
257,056
|
|
14,843
|
|
738,772
|
|
Vice President
|
2015
|
203,401
|
|
—
|
|
81,813
|
|
—
|
|
128,461
|
|
42,181
|
|
144,040
|
|
599,896
|
|
B. C. Terry
|
2016
|
284,498
|
|
—
|
|
173,191
|
|
—
|
|
219,620
|
|
226,913
|
|
16,402
|
|
920,624
|
|
Vice President
|
2015
|
278,682
|
|
—
|
|
168,195
|
|
—
|
|
198,007
|
|
34,345
|
|
19,421
|
|
698,650
|
|
|
2014
|
270,543
|
|
—
|
|
97,904
|
|
65,287
|
|
173,833
|
|
245,578
|
|
17,664
|
|
870,809
|
|
|
Relocation Benefits
($)
|
Other Perquisites
($)
|
Tax
Reimbursements
($)
|
Company Contributions to ESP
($)
|
Company Contributions to SBP
($)
|
Total
($)
|
||||||
S. W. Connally, Jr.
|
—
|
1,385
|
|
—
|
12,407
|
|
10,731
|
|
24,523
|
|
||
X. Liu
|
500
|
|
6,097
|
|
42
|
|
13,425
|
|
832
|
|
20,897
|
|
J. R. Fletcher
|
12,059
|
|
2,754
|
|
7,133
|
|
12,875
|
|
—
|
34,822
|
|
|
W. E. Smith
|
—
|
2,107
|
|
2,038
|
|
8,458
|
|
2,241
|
|
14,843
|
|
|
B. C. Terry
|
—
|
1,721
|
|
172
|
|
13,515
|
|
994
|
|
16,402
|
|
•
|
Financial planning
is provided for most officers of Gulf Power, including all of the named executive officers. Gulf Power provides an annual subsidy of up to $8,200 to be used for financial planning, tax preparation fees, and estate planning. In the initial year, the maximum allowed amount is $13,200.
|
•
|
The Southern Company system has aircraft that are used to facilitate business travel. All flights on these aircraft must have a business purpose, except limited personal use that is associated with business travel is permitted for the President and Chief Executive Officer. Additionally, limited personal use related to relocation is permissible but must be approved. The amount reported for such personal use is the incremental cost of providing the benefit, primarily fuel costs. Also, if seating is available, Southern Company permits a spouse or other family member to accompany an employee on a flight. However, because in such cases the aircraft is being used for a business purpose, there is no incremental cost associated with the family travel, and no amounts are included for such travel. Any additional expenses incurred that are related to family travel are included.
|
•
|
Other miscellaneous perquisites reflects the full cost to Gulf Power of providing the following items: personal use of company-provided computers, personal use of company-provided tickets for sporting and other entertainment events, and gifts distributed to and activities provided to attendees at company-sponsored events.
|
Name
(a)
|
Grant
Date
(b)
|
Estimated Future Payouts Under
Non-Equity Incentive Plan Awards
|
Estimated Future Payouts Under
Equity Incentive Plan Awards
|
Grant Date
Fair
Value of
Stock and
Option
Awards
($)
(i)
|
|||||||||
Threshold
($)
(c)
|
Target
($)
(d)
|
Maximum
($)
(e)
|
Threshold
(#)
(f)
|
Target
(#)
(g)
|
Maximum
(#)
(h)
|
||||||||
S. W. Connally, Jr.
|
|
2,991
|
|
299,135
|
|
598,270
|
|
|
|
|
|
||
|
2/8/2016
|
|
|
|
172
|
17,159
|
|
34,318
|
805,355
|
|
|||
X. Liu
|
|
1,274
|
|
127,434
|
|
254,868
|
|
|
|
|
|
||
|
2/8/2016
|
|
|
|
36
|
3,620
|
|
7,240
|
169,904
|
|
|||
J. R. Fletcher
|
|
1,170
|
|
117,031
|
|
234,062
|
|
|
|
|
|
||
|
2/8/2016
|
|
|
|
32
|
3,166
|
|
6,332
|
148,596
|
|
|||
W. E. Smith
|
|
916
|
|
91,588
|
|
183,176
|
|
|
|
|
|
||
|
2/8/2016
|
|
|
|
18
|
1,805
|
|
3,610
|
84,719
|
|
|||
B. C. Terry
|
|
1,269
|
|
126,948
|
|
253,896
|
|
|
|
|
|
||
|
2/8/2016
|
|
|
|
37
|
3,690
|
|
7,380
|
173,191
|
|
|
Option Awards
|
Stock Awards
|
|||||
Name
(a)
|
Number
of
Securities Underlying Unexercised Options
Exercisable
(#)
(b)
|
Number of Securities Underlying Unexercised Options
Unexercisable
(#)
(c)
|
Option Exercise Price
($)
(d)
|
Option Expiration Date
(e)
|
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)
(f)
|
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
($)
(g)
|
|
S. W. Connally, Jr.
|
16,100
16,053
66,905
62,753
|
0
0
0
31,377
|
37.97
44.42
44.06
41.28
|
02/14/2021
02/13/2022
02/11/2023
02/10/2024
|
12,922
17,945
|
635,633
882,714
|
|
X. Liu
|
10,079
9,976
12,016
17,595
|
0
0
0
8,798
|
37.97
44.42
44.06
41.28
|
02/14/2021
02/13/2022
02/11/2023
02/10/2024
|
3,613
3,786
|
177,723
186,233
|
|
J. R.Fletcher
|
0
|
5,121
|
41.28
|
02/10/2024
|
3,366
3,311
|
165,574
162,868
|
|
W. E. Smith
|
5,037
6,011
5,676
|
0
0
2,838
|
44.42
44.06
41.28
|
2/13/2022
2/11/2023
2/10/2024
|
1,908
1,888
|
93,854
92,871
|
|
B. C. Terry
|
18,163
21,719
0
|
0
0
9,892
|
44.42
44.06
41.28
|
02/13/2022
02/11/2023
02/10/2024
|
3,924
3,859
|
193,022
189,824
|
|
Option Awards
|
Stock Awards
|
||||||
Name
(a)
|
Number of Shares Acquired on Exercise (#)
(b)
|
Value Realized on Exercise ($)
(c)
|
Number of Shares Acquired on Vesting (#)
(d)
|
Value Realized on Vesting ($)
(e)
|
||||
S. W. Connally, Jr.
|
14,392
|
|
321,805
|
|
—
|
|
—
|
|
X. Liu
|
—
|
|
—
|
|
—
|
|
—
|
|
J. R. Fletcher
|
34,174
|
|
352,649
|
|
—
|
|
—
|
|
W. E. Smith
|
—
|
|
—
|
|
—
|
|
—
|
|
B. C. Terry
|
38,358
|
|
466,326
|
|
—
|
|
—
|
|
Name
|
Plan Name
|
Number of Years Credited Service (#)
|
Present Value of Accumulated Benefit ($)
|
Payments During
Last Fiscal Year ($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
S.W. Connally, Jr.
|
Pension Plan
SBP-P
SERP
|
25.17
25.17
25.17
|
658,389
894,191
545,110
|
0
0
0
|
X. Liu
|
Pension Plan
SBP-P
SERP
|
16.92
16.92
16.92
|
455,857
130,662
172,855
|
0
0
0
|
J. R. Fletcher
|
Pension Plan
SBP-P
SERP
|
26.58
26.58
26.58
|
731,921
184,848
254,833
|
0
0
0
|
W. E. Smith
|
Pension Plan
SBP-P
SERP
|
29.17
29.17
29.17
|
726,236
142,898
230,814
|
0
0
0
|
B. C. Terry
|
Pension Plan
SBP-P
SERP
SRA
|
14.50
14.50
14.50
10.00
|
389,796
128,349
132,793
484,907
|
0
0
0
0
|
l
|
|
Discount rate - 4.46% Pension Plan and 3.89% supplemental plans as of December 31, 2016,
|
|||
l
|
|
Retirement date - Normal retirement age (65 for all named executive officers),
|
|||
l
|
|
Mortality after normal retirement - Adjusted RP-2014 mortality tables with generational projections,
|
|||
l
|
|
Mortality, withdrawal, disability, and retirement rates prior to normal retirement - None,
|
|||
l
|
|
Form of payment for Pension Benefits:
|
|||
|
o
|
|
Male retirees: 25% single life annuity; 25% level income annuity; 25% joint and 50% survivor annuity; and 25% joint and 100% survivor annuity,
|
||
|
o
|
|
Female retirees: 50% single life annuity; 30% level income annuity; 15% joint and 50% survivor annuity; and 5% joint and 100% survivor annuity,
|
||
l
|
|
Spouse ages - Wives two years younger than their husbands,
|
|||
l
|
|
Annual performance-based compensation earned but unpaid as of the measurement date - 130% of target opportunity percentages times base rate of pay for year amount is earned, and
|
|||
l
|
|
Installment determination - 3.75% discount rate for single sum calculation and 4.25% prime rate during installment payment period.
|
Name
(a)
|
Executive Contributions
in Last FY
($)
(b)
|
Employer Contributions
in Last FY
($)
(c)
|
Aggregate Earnings
in Last FY
($)
(d)
|
Aggregate Withdrawals/
Distributions
($)
(e)
|
Aggregate Balance
at Last FYE
($)
(f)
|
|||
S. W. Connally, Jr.
|
27,230
|
10,731
|
|
14,263
|
|
—
|
196,129
|
|
X. Liu
|
47,249
|
832
|
|
6,153
|
|
—
|
187,251
|
|
J. R. Fletcher
|
—
|
—
|
|
—
|
|
—
|
—
|
|
W. E. Smith
|
69,491
|
2,241
|
|
7,520
|
|
—
|
180,315
|
|
B. C. Terry
|
99,004
|
994
|
|
22,977
|
|
—
|
488,758
|
|
|
|
Amounts Deferred under the DCP Prior to 2016 and Reported in Prior Years' Annual Reports on Form 10-K
|
|
Employer Contributions under the SBP Prior to 2016 and Reported in Prior Years' Annual Reports on Form 10-K
|
|
Total
|
|
|||||||
Name
|
|
|
($)
|
|
|
|
($)
|
|
|
($)
|
|
|||
S. W. Connally, Jr.
|
|
|
31,742
|
|
|
|
|
26,830
|
|
|
|
58,572
|
|
|
X. Liu
|
|
|
—
|
|
|
|
|
19
|
|
|
|
19
|
|
|
J. R. Fletcher
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
W. E. Smith
|
|
|
49,139
|
|
|
|
|
1,563
|
|
|
|
50,702
|
|
|
B. C. Terry
|
|
|
374,074
|
|
|
|
|
2,186
|
|
|
|
376,260
|
|
|
•
|
Retirement or Retirement-Eligible - Termination of a named executive officer who is at least 50 years old and has at least 10 years of credited service.
|
•
|
Resignation - Voluntary termination of a named executive officer who is not retirement-eligible.
|
•
|
Lay Off - Involuntary termination of a named executive officer who is not retirement-eligible not for cause.
|
•
|
Involuntary Termination - Involuntary termination of a named executive officer for cause. Cause includes individual performance below minimum performance standards and misconduct, such as violation of the Company's Drug and Alcohol Policy.
|
•
|
Death or Disability - Termination of a named executive officer due to death or disability.
|
•
|
Southern Company Change-in-Control I - Consummation of an acquisition by another entity of 20% or more of Common Stock or, following consummation of a merger with another entity, Southern Company's stockholders own 65% or less of the entity surviving the merger.
|
•
|
Southern Company Change-in-Control II - Consummation of an acquisition by another entity of 35% or more of Common Stock or, following consummation of a merger with another entity, Southern Company's stockholders own less than 50% of Southern Company surviving the merger.
|
•
|
Southern Company Does Not Survive a Merger - Consummation of a merger or other event and Southern Company is not the surviving company or the Common Stock is no longer publicly traded.
|
•
|
Company Change-in-Control - Consummation of an acquisition by another entity, other than another subsidiary of Southern Company, of 50% or more of the stock of Gulf Power, consummation of a merger with another entity and Gulf Power is not the surviving company, or the sale of substantially all the assets of Gulf Power.
|
•
|
Involuntary Change-in-Control Termination or Voluntary Change-in-Control Termination for Good Reason - Employment is terminated within two years of a change in control, other than for cause, or the employee voluntarily terminates for good reason. Good reason for voluntary termination within two years of a change in control generally is satisfied when there is a material reduction in salary, performance-based compensation opportunity, or benefits; relocation of over 50 miles; or a diminution in duties and responsibilities.
|
Program
|
Retirement/
Retirement-
Eligible
|
Lay Off
(Involuntary
Termination
Not For Cause)
|
Resignation
|
Death or
Disability
|
Involuntary
Termination
(For Cause)
|
Pension Benefits Plans
|
Benefits payable
as described in the notes following
the Pension
Benefits table.
|
Benefits payable as described in the notes following the Pension Benefits table.
|
Benefits payable as described in the notes following the Pension Benefits table.
|
Benefits payable as described in the notes following the Pension Benefits table.
|
Benefits payable as described in the notes following the Pension Benefits table.
|
Annual Performance Pay Program
|
Prorated if
before 12/31.
|
Prorated if
before 12/31.
|
Forfeit.
|
Prorated if
before 12/31.
|
Forfeit.
|
Stock Options
|
Vest; expire earlier of original expiration date or five years.
|
Vested options expire in 90 days; unvested are forfeited.
|
Vested options expire in 90 days; unvested are forfeited.
|
Vest; expire earlier of original expiration date or three years.
|
Forfeit.
|
Performance Shares
|
No proration if retirement prior to end of performance period. Will receive full amount actually earned.
|
Forfeit.
|
Forfeit.
|
Death - prorated based on number of months employed during performance period.
Disability - not affected. Will receive full amount actually earned.
|
Forfeit.
|
Financial
Planning Perquisite
|
Continues for one year.
|
Terminates.
|
Terminates.
|
Continues for one year.
|
Terminates.
|
DCP
|
Payable per prior elections (lump
sum or up to 10 annual installments).
|
Payable per prior elections (lump
sum or up to 10 annual installments).
|
Payable per prior elections (lump
sum or up to 10 annual installments).
|
Payable to beneficiary or participant per prior elections. Amounts deferred prior to 2005 can be paid as a lump sum per the benefit administration committee's discretion.
|
Payable per prior elections (lump
sum or up to 10 annual installments).
|
SBP - non-pension related
|
Payable per prior elections (lump
sum or up to 20 annual installments).
|
Payable per prior elections (lump
sum or up to 20 annual installments).
|
Payable per prior elections (lump
sum or up to 20 annual installments).
|
Payable to beneficiary or participant per prior elections. Amounts deferred prior to 2005 can be paid as a lump sum per the benefit administration committee's discretion.
|
Payable per prior elections (lump
sum or up to 20 annual installments).
|
Program
|
Southern Company
Change in Control I
|
Southern Company
Change in Control II
|
Southern Company
Does Not Survive Merger or
Gulf Power Change in
Control
|
Involuntary Change-in-
Control-Related Termination or Voluntary
Change-in-Control-Related
Termination for Good Reason
|
Nonqualified Pension Benefits
(except SRA)
|
All SERP-related benefits vest if participants vested in tax-qualified pension benefits; otherwise, no impact. SBP-P benefits vest for all participants and single sum value of benefits earned to change-in-control date paid following termination or retirement.
|
Benefits vest for all participants and single sum value of benefits earned to the change-in-control date paid following termination or retirement.
|
Benefits vest for all participants and single sum value of benefits earned to the change-in-control date paid following termination or retirement.
|
Based on type of change-in-control event.
|
SRA
|
Not affected.
|
Not affected.
|
Not affected.
|
Vest.
|
Annual Performance Pay Program
|
If no program
termination, paid at greater of target or actual performance. If program terminated within two years of change in control, prorated at target performance level.
|
If no program
termination, paid at greater of target or actual performance. If program terminated within two years of change in control, prorated at target performance level.
|
Prorated at target performance level.
|
If not otherwise eligible for payment, if the program is still in effect, prorated at target performance level.
|
Stock Options
|
Not affected.
|
Not affected.
|
Vest and convert to surviving company's securities; if cannot convert, pay spread in cash.
|
Vest.
|
Performance Shares
|
Not affected.
|
Not affected.
|
Vest and convert to surviving company's securities; if cannot convert, pay spread in cash.
|
Vest.
|
DCP
|
Not affected.
|
Not affected.
|
Not affected.
|
Not affected.
|
SBP
|
Not affected.
|
Not affected.
|
Not affected.
|
Not affected.
|
Severance Benefits
|
Not applicable.
|
Not applicable.
|
Not applicable.
|
One or two times base salary plus target annual performance-based pay.
|
Healthcare Benefits
|
Not applicable.
|
Not applicable.
|
Not applicable.
|
Up to five years participation in group healthcare plan plus payment of two or three years' premium amounts.
|
Outplacement Services
|
Not applicable.
|
Not applicable.
|
Not applicable.
|
Six months.
|
Name
|
Retirement ($)
|
Resignation or Involuntary Termination ($)
|
Death (payments to a spouse) ($)
|
|
|||||||||
S. W. Connally, Jr.
|
Pension
|
n/a
|
2,830
|
|
4,240
|
|
|
||||||
|
SBP-P
|
n/a
|
1,135,437
|
|
122,294
|
|
|
||||||
|
SERP
|
n/a
|
—
|
|
74,552
|
|
|
||||||
X. Liu
|
Pension
|
n/a
|
1,884
|
|
2,849
|
|
|
||||||
|
SBP-P
|
n/a
|
166,291
|
|
18,041
|
|
|
||||||
|
SERP
|
n/a
|
—
|
|
23,867
|
|
|
||||||
J. R. Fletcher
|
Pension
|
4,144
|
All plans treated as retiring
|
|
3,882
|
|
|
||||||
|
SBP-P
|
23,062
|
|
23,062
|
|
|
|||||||
|
SERP
|
31,794
|
|
31,794
|
|
|
|||||||
W. E. Smith
|
Pension
|
4,247
|
All plans treated as retiring
|
|
3,641
|
|
|
||||||
|
SBP-P
|
18,189
|
|
18,189
|
|
|
|||||||
|
SERP
|
29,380
|
|
29,380
|
|
|
|||||||
B. C. Terry
|
Pension
|
n/a
|
1,628
|
|
2,463
|
|
|
||||||
|
SBP-P
|
n/a
|
163,196
|
|
17,892
|
|
|
||||||
|
SERP
|
n/a
|
—
|
|
18,511
|
|
|
||||||
|
SRA
|
n/a
|
—
|
|
67,596
|
|
|
Name
|
|
SBP-P ($)
|
|
SERP ($)
|
SRA ($)
|
Total ($)
|
|
|
||||||||||||||||||||
S. W. Connally, Jr.
|
|
|
1,116,343
|
|
|
|
|
680,537
|
|
|
—
|
|
|
1,796,880
|
|
|
||||||||||||
X. Liu
|
|
|
163,495
|
|
|
|
|
216,289
|
|
|
—
|
|
|
379,784
|
|
|
||||||||||||
J. R. Fletcher
|
|
|
230,621
|
|
|
|
|
317,936
|
|
|
—
|
|
|
548,557
|
|
|
||||||||||||
W. E. Smith
|
|
|
181,892
|
|
|
|
|
293,798
|
|
|
—
|
|
|
475,690
|
|
|
||||||||||||
B. C. Terry
|
|
|
160,452
|
|
|
|
|
166,007
|
|
|
606,192
|
|
|
932,651
|
|
|
|
||||||||||||
|
|
Total Number of
|
|
|||||||||
|
Number of Equity
|
Equity Awards
|
Total Payable in
|
|||||||||
|
Awards with
|
Following
|
Cash without
|
|||||||||
|
Accelerated Vesting (#)
|
Accelerated Vesting (#)
|
Conversion of
|
|||||||||
|
Stock
|
Performance
|
|
Stock
|
Performance
|
|
Equity
|
|||||
Name
|
Options
|
Shares
|
|
Options
|
Shares
|
|
Awards ($)
|
|||||
S. W. Connally, Jr.
|
31,377
|
|
30,867
|
|
|
193,188
|
|
30,867
|
|
|
2,863,353
|
|
X. Liu
|
8,798
|
|
7,399
|
|
|
58,464
|
|
7,399
|
|
|
795,039
|
|
J. R. Fletcher
|
5,121
|
|
6,677
|
|
|
5,121
|
|
6,677
|
|
|
368,949
|
|
W. E. Smith
|
2,838
|
|
3,796
|
|
|
19,562
|
|
3,796
|
|
|
308,934
|
|
B. C. Terry
|
9,892
|
|
7,783
|
|
|
49,774
|
|
7,783
|
|
|
659,147
|
|
•
|
As of December 31, 2016, the severance payment was two times the base salary and target payout under the annual Performance Pay Program for Mr. Connally and one times the base salary and target payout under the annual Performance Pay Program for the other named executive officers.
|
•
|
The estimated cost of providing the six months of outplacement services is $6,000 per named executive officer.
|
•
|
If any portion of the severance amount constitutes an "excess parachute payment" under Section 280G of the Internal Revenue Code and is therefore subject to an excise tax, the severance amount will be reduced unless the after-tax "unreduced amount" exceeds the after-tax "reduced amount." Excise tax gross-ups will not be provided on change-in-control severance payments.
|
|
|
|
|
|
Name
|
Severance Amount ($)
|
|||
S. W. Connally, Jr.
|
1,518,687
|
|
||
X. Liu
|
410,622
|
|
||
J. R. Fletcher
|
377,098
|
|
||
W. E. Smith
|
320,558
|
|
||
B. C. Terry
|
409,056
|
|
Annual cash retainer:
|
$22,000 per year
|
Annual stock retainer:
|
$19,500 per year in Common Stock
|
Board meeting fees:
|
If more than five meetings are held in a calendar year, $1,200 will be paid for participation beginning with the sixth meeting.
|
Committee meeting fees:
|
If more than five meetings of any one committee are held in a calendar year, $1,000 will be paid for participation in each meeting of that committee beginning with the sixth meeting.
|
•
|
in Common Stock units which earn dividends as if invested in Common Stock and are distributed in shares of Common Stock or cash upon leaving the board; or
|
•
|
at the prime interest rate which is paid in cash upon leaving the board.
|
Name
|
Fees Earned or Paid in Cash
($)
(1)
|
Stock
Awards
($)
(2)
|
All Other Compensation
($)
(3)
|
Total
($)
|
|
Allan G. Bense
|
22,000
|
19,500
|
100
|
41,600
|
|
Deborah H. Calder
|
22,000
|
19,500
|
100
|
41,600
|
|
William C. Cramer, Jr.
|
22,000
|
19,500
|
100
|
41,600
|
|
Julian B. MacQueen
|
22,000
|
19,500
|
100
|
41,600
|
|
J. Mort O'Sullivan III
|
22,000
|
19,500
|
100
|
41,600
|
|
Michael T. Rehwinkel
|
22,000
|
19,500
|
100
|
41,600
|
|
Winston E. Scott
|
22,000
|
19,500
|
100
|
41,600
|
|
(1)
|
Includes amounts voluntarily deferred in the Director Deferred Compensation Plan.
|
(2)
|
Includes fair market value of equity grants on grant dates. All such stock awards are vested immediately upon grant.
|
(3)
|
Includes value of charitable contribution made in each director's name.
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
Title of Class
|
|
Name and Address
of Beneficial
Owner
|
|
Amount and
Nature of
Beneficial
Ownership
|
|
Percent
of
Class
|
||
Common Stock
|
|
The Southern Company
30 Ivan Allen Jr. Boulevard, N.W.
Atlanta, Georgia 30308
|
|
|
|
100
|
%
|
|
|
|
Registrant:
Gulf Power
|
|
7,392,717
|
|
|
|
(1)
|
"Beneficial ownership" means the sole or shared power to vote, or to direct the voting of, a security and/or investment power with respect to a security or any combination thereof.
|
(2)
|
Indicates the number of deferred stock units held under the Director Deferred Compensation Plan.
|
(3)
|
Indicates shares of Common Stock that certain executive officers have the right to acquire within 60 days. Shares indicated are included in the Shares Beneficially Owned column.
|
(4)
|
Shares indicated are included in the Shares Beneficially Owned column.
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
|
•
|
The Southern Company Audit Committee is responsible for overseeing the Code of Ethics, which includes policies relating to conflicts of interest. The Code of Ethics requires that all employees and directors avoid conflicts of interest, defined as situations where the person's private interests conflict, or even appear to conflict, with the interests of Southern Company as a whole.
|
•
|
Southern Company also has a Contract Manual and other formal written procurement policies and procedures that guide the purchase of goods and services, including requiring competitive bids for purchases of materials for $10,000 and above and for purchases of services for $25,000 and above or approval based on documented business needs for sole sourcing arrangements.
|
•
|
At least annually, each director and executive officer completes a detailed questionnaire that asks about any business relationship that may give rise to a conflict of interest and all transactions in which the Southern Company or a subsidiary is involved and in which the executive officer, director, or a related party has a direct or indirect material interest.
|
•
|
Southern Company also conducts a review of financial systems to identify potential conflicts of interest and related party transactions.
|
•
|
A determination of the need for the goods and services;
|
•
|
Preparation and evaluation of requests for proposals by the lead support organization;
|
•
|
The writing of contracts;
|
•
|
Controls and guidance regarding the evaluation of the proposals; and
|
•
|
Negotiation of contract terms and conditions.
|
ITEM 14.
|
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
|
2016
|
|
2015
|
||||
|
(in thousands)
|
||||||
Gulf Power
|
|
|
|
||||
Audit Fees (1)
|
$
|
1,346
|
|
|
$
|
1,359
|
|
Audit-Related Fees
|
3
|
|
|
2
|
|
||
Tax Fees
|
—
|
|
|
—
|
|
||
All Other Fees (2)
|
2
|
|
|
1
|
|
||
Total
|
$
|
1,351
|
|
|
$
|
1,362
|
|
Southern Power
|
|
|
|
||||
Audit Fees (1)
|
$
|
1,817
|
|
|
$
|
1,478
|
|
Audit-Related Fees
|
372
|
|
|
3
|
|
||
Tax Fees
|
—
|
|
|
—
|
|
||
All Other Fees (2)
|
6
|
|
|
5
|
|
||
Total
|
$
|
2,195
|
|
|
$
|
1,486
|
|
(1)
|
Includes services performed in connection with financing transactions.
|
(2)
|
Represents registration fees for attendance at Deloitte & Touche LLP-sponsored education seminars in 2015 and 2016 and subscription fees for Deloitte & Touche LLP's technical accounting research tool in 2015.
|
|
2016
|
|
2015
|
||||
|
(in thousands)
|
||||||
|
|
|
|
||||
Audit Fees (1)
|
$
|
5,131
|
|
|
$
|
3,967
|
|
Audit-Related Fees (2)
|
59
|
|
|
88
|
|
||
Tax Fees (3)
|
65
|
|
|
75
|
|
||
All Other Fees (4)
|
7
|
|
|
—
|
|
||
Total
|
$
|
5,262
|
|
|
$
|
4,130
|
|
(1)
|
Includes fees for services performed in connection with financing transactions billed by Deloitte & Touche LLP in 2016 and PricewaterhouseCoopers LLP in 2015. Also includes fees for audits of several subsidiaries by Deloitte & Touche LLP in 2016 and PricewaterhouseCoopers LLP in 2015.
|
(2)
|
Represents fees for a review report on internal controls provided to third parties billed by Deloitte & Touche LLP in 2016 and PricewaterhouseCoopers LLP in 2015.
|
(3)
|
Represents fees billed by Deloitte & Touche LLP for tax compliance services in 2016 and PricewaterhouseCoopers LLP for tax compliance, planning, and advisory services in 2015.
|
(4)
|
Represents registration fees for attendance at Deloitte & Touche LLP-sponsored education seminars in 2016 and subscription fees for Deloitte & Touche LLP's technical accounting research tool in 2016.
|
Item 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
(a)
|
The following documents are filed as a part of this report on Form 10-K:
|
(1)
|
Financial Statements and Financial Statement Schedules:
|
(2)
|
Exhibits:
|
THE SOUTHERN COMPANY
|
|
|
|
By:
|
Thomas A. Fanning
|
|
Chairman, President, and
|
|
Chief Executive Officer
|
|
|
By:
|
/s/Melissa K. Caen
|
|
(Melissa K. Caen, Attorney-in-fact)
|
|
|
Date:
|
February 21, 2017
|
Thomas A. Fanning
Chairman, President, and
Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
Art P. Beattie
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
Ann P. Daiss
Comptroller and Chief Accounting Officer
(Principal Accounting Officer)
|
|
|
|
Directors:
|
|
|
|
Juanita Powell Baranco
Jon A. Boscia
Henry A. Clark III
David J. Grain
Veronica M. Hagen
Warren A. Hood, Jr.
Linda P. Hudson
|
Donald M. James
John D. Johns
Dale E. Klein
William G. Smith, Jr.
Steven R. Specker
Larry D. Thompson
E. Jenner Wood III
|
|
|
By:
|
|
/s/Melissa K. Caen
|
|
|
(Melissa K. Caen, Attorney-in-fact)
|
ALABAMA POWER COMPANY
|
|
|
|
By:
|
Mark A. Crosswhite
|
|
Chairman, President, and Chief Executive Officer
|
|
|
By:
|
/s/Melissa K. Caen
|
|
(Melissa K. Caen, Attorney-in-fact)
|
|
|
Date:
|
February 21, 2017
|
Mark A. Crosswhite
Chairman, President, and Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
Philip C. Raymond
Executive Vice President, Chief Financial Officer, and Treasurer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
Anita Allcorn-Walker
Vice President and Comptroller
(Principal Accounting Officer)
|
|
|
|
Directors:
|
|
|
|
Whit Armstrong
David J. Cooper, Sr.
O. B. Grayson Hall, Jr.
Anthony A. Joseph
Patricia M. King
|
James K. Lowder
Robert D. Powers
Catherine J. Randall
C. Dowd Ritter
R. Mitchell Shackleford, III
|
|
|
By:
|
|
/s/Melissa K. Caen
|
|
|
(Melissa K. Caen, Attorney-in-fact)
|
GEORGIA POWER COMPANY
|
|
|
|
By:
|
W. Paul Bowers
|
|
Chairman, President, and Chief Executive Officer
|
|
|
By:
|
/s/Melissa K. Caen
|
|
(Melissa K. Caen, Attorney-in-fact)
|
|
|
Date:
|
February 21, 2017
|
W. Paul Bowers
Chairman, President, and Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
W. Ron Hinson
Executive Vice President, Chief Financial Officer,
and Treasurer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
David P. Poroch
Comptroller and Vice President
(Principal Accounting Officer)
|
|
|
|
Directors:
|
|
|
|
Robert L. Brown, Jr.
Anna R. Cablik
Stephen S. Green
Kessel D. Stelling, Jr.
Jimmy C. Tallent
|
Charles K. Tarbutton
Beverly Daniel Tatum
Clyde C. Tuggle
Richard W. Ussery
|
|
|
By:
|
|
/s/Melissa K. Caen
|
|
|
(Melissa K. Caen, Attorney-in-fact)
|
GULF POWER COMPANY
|
|
|
|
By:
|
S. W. Connally, Jr.
|
|
Chairman, President, and Chief Executive Officer
|
|
|
By:
|
/s/Melissa K. Caen
|
|
(Melissa K. Caen, Attorney-in-fact)
|
|
|
Date:
|
February 21, 2017
|
S. W. Connally, Jr.
Chairman, President, and Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
Xia Liu
Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
Janet J. Hodnett
Comptroller
(Principal Accounting Officer)
|
|
|
|
Directors:
|
|
|
|
Allan G. Bense
|
J. Mort O'Sullivan, III
|
|
|
Deborah H. Calder
|
Michael T. Rehwinkel
|
|
|
William C. Cramer, Jr.
|
Winston E. Scott
|
|
|
Julian B. MacQueen
|
|
|
|
By:
|
|
/s/Melissa K. Caen
|
|
|
(Melissa K. Caen, Attorney-in-fact)
|
MISSISSIPPI POWER COMPANY
|
|
|
|
By:
|
Anthony L. Wilson
|
|
Chairman, President, and Chief Executive Officer
|
|
|
By:
|
/s/Melissa K. Caen
|
|
(Melissa K. Caen, Attorney-in-fact)
|
|
|
Date:
|
February 21, 2017
|
Anthony L. Wilson
Chairman, President, and Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
Moses H. Feagin
Vice President, Treasurer, and
Chief Financial Officer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
Cynthia F. Shaw
Comptroller
(Principal Accounting Officer)
|
|
|
|
Directors:
|
|
|
|
Carl J. Chaney
|
Mark E. Keenum
|
|
|
L. Royce Cumbest
|
Christine L. Pickering
|
|
|
Thomas A. Dews
|
Phillip J. Terrell
|
|
|
|
M. L. Waters
|
|
|
By:
|
|
/s/Melissa K. Caen
|
|
|
(Melissa K. Caen, Attorney-in-fact)
|
SOUTHERN POWER COMPANY
|
|
|
|
By:
|
Joseph A. Miller
|
|
Chairman, President and Chief Executive Officer
|
|
|
By:
|
/s/Melissa K. Caen
|
|
(Melissa K. Caen, Attorney-in-fact)
|
|
|
Date:
|
February 21, 2017
|
Joseph A. Miller
Chairman, President, and Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
William C. Grantham
Senior Vice President, Chief Financial Officer, and Treasurer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
Elliott L. Spencer
Comptroller and Corporate Secretary
(Principal Accounting Officer)
|
|
|
|
Directors:
|
|
|
|
Art P. Beattie
|
Mark S. Lantrip
|
|
|
Thomas A. Fanning
|
Christopher C. Womack
|
|
|
Kimberly S. Greene
|
|
|
|
James Y. Kerr II
|
|
|
|
By:
|
|
/s/Melissa K. Caen
|
|
|
(Melissa K. Caen, Attorney-in-fact)
|
SOUTHERN COMPANY GAS
|
|
|
|
By:
|
Andrew W. Evans
|
|
Chairman, President, and Chief Executive Officer
|
|
|
By:
|
/s/Melissa K. Caen
|
|
(Melissa K. Caen, Attorney-in-fact)
|
|
|
Date:
|
February 21, 2017
|
Andrew W. Evans
Chairman, President, and Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
Elizabeth W. Reese
Executive Vice President, Chief Financial Officer, and Treasurer
(Principal Financial Officer)
|
|
|
|
|
|
|
|
Grace A. Kolvereid
Senior Vice President, Accounting
(Principal Accounting Officer)
|
|
|
|
Directors:
|
|
|
|
Sandra N. Bane
|
Kimberly S. Greene
|
|
|
Thomas D. Bell, Jr.
|
John E. Rau
|
|
|
Charles R. Crisp
|
James A. Rubright
|
|
|
Brenda J. Gaines
|
|
|
|
By:
|
|
/s/Melissa K. Caen
|
|
|
(Melissa K. Caen, Attorney-in-fact)
|
|
|
|
Page
|
Schedule II
|
|
Valuation and Qualifying Accounts and Reserves 2016, 2015, and 2014
|
|
S-2
|
|
S-3
|
|
S-4
|
|
S-5
|
|
S-6
|
|
S-7
|
|
|
|
Additions
|
|
|
|
|
||||||||||||||||
Description
|
Balance at Beginning of Period
|
|
Charged to Income
|
|
Charged to Other Accounts
|
|
Acquisitions
|
|
Deductions (Note)
|
|
Balance at End of Period
|
||||||||||||
Provision for uncollectible accounts
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
2016
|
$
|
13,341
|
|
|
$
|
39,959
|
|
|
$
|
(1,257
|
)
|
|
$
|
40,629
|
|
|
$
|
49,243
|
|
|
$
|
43,429
|
|
2015
|
18,253
|
|
|
31,074
|
|
|
—
|
|
|
—
|
|
|
35,986
|
|
|
13,341
|
|
||||||
2014
|
17,855
|
|
|
43,537
|
|
|
—
|
|
|
—
|
|
|
43,139
|
|
|
18,253
|
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
Description
|
Balance at Beginning
of Period
|
|
Charged to
Income
|
|
Charged to Other Accounts
|
|
Deductions
(Note)
|
|
Balance at
End of Period
|
||||||||||
Provision for uncollectible accounts
|
|
|
|
|
|
|
|
|
|
||||||||||
2016
|
$
|
9,597
|
|
|
$
|
11,310
|
|
|
$
|
—
|
|
|
$
|
10,420
|
|
|
$
|
10,487
|
|
2015
|
9,143
|
|
|
13,500
|
|
|
—
|
|
|
13,046
|
|
|
9,597
|
|
|||||
2014
|
8,350
|
|
|
14,309
|
|
|
—
|
|
|
13,516
|
|
|
9,143
|
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
Description
|
Balance at Beginning
of Period
|
|
Charged to
Income
|
|
Charged to Other
Accounts
|
|
Deductions
(Note)
|
|
Balance at End of Period
|
||||||||||
Provision for uncollectible accounts
|
|
|
|
|
|
|
|
|
|
||||||||||
2016
|
$
|
2,147
|
|
|
$
|
14,476
|
|
|
$
|
—
|
|
|
$
|
13,787
|
|
|
$
|
2,836
|
|
2015
|
6,076
|
|
|
16,862
|
|
|
—
|
|
|
20,791
|
|
|
2,147
|
|
|||||
2014
|
5,074
|
|
|
24,141
|
|
|
—
|
|
|
23,139
|
|
|
6,076
|
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
Description
|
Balance at Beginning
of Period
|
|
Charged to
Income
|
|
Charged to Other
Accounts
|
|
Deductions
(Note)
|
|
Balance at End of Period
|
||||||||||
Provision for uncollectible accounts
|
|
|
|
|
|
|
|
|
|
||||||||||
2016
|
$
|
775
|
|
|
$
|
2,946
|
|
|
$
|
—
|
|
|
$
|
2,989
|
|
|
$
|
732
|
|
2015
|
2,087
|
|
|
2,041
|
|
|
—
|
|
|
3,353
|
|
|
775
|
|
|||||
2014
|
1,131
|
|
|
4,304
|
|
|
—
|
|
|
3,348
|
|
|
2,087
|
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
Description
|
Balance at Beginning
of Period
|
|
Charged to
Income
|
|
Charged to Other
Accounts
|
|
Deductions
(Note)
|
|
Balance at End of Period
|
||||||||||
Provision for uncollectible accounts
|
|
|
|
|
|
|
|
|
|
||||||||||
2016
|
$
|
287
|
|
|
$
|
1,295
|
|
|
$
|
—
|
|
|
$
|
1,088
|
|
|
$
|
494
|
|
2015
(*)
|
825
|
|
|
(1,994
|
)
|
|
—
|
|
|
(1,456
|
)
|
|
287
|
|
|||||
2014
|
3,018
|
|
|
562
|
|
|
—
|
|
|
2,755
|
|
|
825
|
|
(*)
|
The refund ordered by the Mississippi PSC pursuant to the 2015 Mississippi Supreme Court decision relative to Mirror CWIP involved refunding all billed amounts to all historical customers and included an interest component. The refund of approximately
$371 million
in 2015 was of sufficient magnitude to resolve most past due amounts beyond 30 days aged receivables, accounting for the negative provision of
$(2.0) million
where risk of collectibility was offset by applying the refund to past due amounts. It was also of sufficient size to offset amounts previously written off in the 2012-2015 time frame, accounting for the net recoveries of
$1.5 million
.
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
Description
|
Balance at Beginning
of Period
|
|
Charged to
Income
|
|
Charged to Other Accounts
|
|
Deductions
(Note)
|
|
Balance at
End of Period
|
||||||||||
Successor – December 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for uncollectible accounts
|
$
|
37,663
|
|
|
$
|
9,500
|
|
|
$
|
(1,257
|
)
|
|
$
|
18,590
|
|
|
$
|
27,316
|
|
Income tax valuation
|
19,182
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,182
|
|
|||||
Predecessor – June 30, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for uncollectible accounts
|
$
|
29,142
|
|
|
$
|
15,976
|
|
|
$
|
1,608
|
|
|
$
|
9,063
|
|
|
$
|
37,663
|
|
Income tax valuation
|
19,182
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,182
|
|
|||||
Predecessor – 2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for uncollectible accounts
|
$
|
35,069
|
|
|
$
|
27,050
|
|
|
$
|
3,017
|
|
|
$
|
35,994
|
|
|
$
|
29,142
|
|
Income tax valuation
|
19,637
|
|
|
—
|
|
|
—
|
|
|
455
|
|
|
19,182
|
|
|||||
Predecessor – 2014
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for uncollectible accounts
|
$
|
29,261
|
|
|
$
|
54,790
|
|
|
$
|
1,414
|
|
|
$
|
50,396
|
|
|
$
|
35,069
|
|
Income tax valuation
|
22,329
|
|
|
—
|
|
|
—
|
|
|
2,692
|
|
|
19,637
|
|
(2)
|
|
Plan of acquisition, reorganization, arrangement, liquidation or succession
|
||||||||
|
|
Southern Company
|
||||||||
|
|
|
(a)
|
|
1
|
|
—
|
|
Agreement and Plan of Merger by and among Southern Company, AMS Corp., and Southern Company Gas, dated August 23, 2015. (Designated in Form 8-K dated August 23, 2015, File No. 1-3526, as Exhibit 2.1.)
|
|
|
|
Southern Company Gas
|
||||||||
|
|
|
(g)
|
|
1
|
|
—
|
|
Agreement and Plan of Merger by and among Southern Company, AMS Corp., and Southern Company Gas, dated August 23, 2015. See Exhibit 2(a)1 herein.
|
|
|
|
|
(g)
|
|
2
|
|
—
|
|
Purchase and Sale Agreement, dated as of July 10, 2016, among Kinder Morgan SNG Operator LLC, Southern Natural Gas Company, L.L.C., and Southern Company.(Designated in Form 8-K dated August 31, 2016, File No. 1-14174, as Exhibit 2.1a.)
|
|
|
|
|
(g)
|
|
3
|
|
—
|
|
Assignment, Assumption and Novation of Purchase and Sale Agreement, dated as of August 31, 2016, between Southern Company and Evergreen Enterprise Holdings LLC.(Designated in Form 8-K dated August 31, 2016, File No. 1-14174, as Exhibit 2.1b.)
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
|
Articles of Incorporation and By-Laws
|
||||||||
|
|
Southern Company
|
||||||||
|
|
|
(a)
|
|
1
|
|
—
|
|
Composite Certificate of Incorporation of Southern Company, reflecting all amendments thereto through May 26, 2016. (Designated in Registration No. 33-3546 as Exhibit 4(a), in Certificate of Notification, File No. 70-7341, as Exhibit A, in Certificate of Notification, File No. 70-8181, as Exhibit A, in Form 8-K dated May 26, 2010, File No. 1-3526, as Exhibit 3.1, and in Form 8-K dated May 25, 2016, File No. 1-3526, as Exhibit 3.1.)
|
|
|
|
|
(a)
|
|
2
|
|
—
|
|
By-laws of Southern Company as amended effective May 25, 2016, and as presently in effect. (Designated in Form 8-K dated May 25, 2016, File No. 1-3526, as Exhibit 3.2.)
|
|
|
|
Alabama Power
|
||||||||
|
|
|
(b)
|
|
1
|
|
—
|
|
Charter of Alabama Power and amendments thereto through April 25, 2008. (Designated in Registration Nos. 2-59634 as Exhibit 2(b), 2-60209 as Exhibit 2(c), 2-60484 as Exhibit 2(b), 2-70838 as Exhibit 4(a)-2, 2-85987 as Exhibit 4(a)-2, 33-25539 as Exhibit 4(a)-2, 33-43917 as Exhibit 4(a)-2, in Form 8-K dated February 5, 1992, File No. 1-3164, as Exhibit 4(b)-3, in Form 8-K dated July 8, 1992, File No. 1-3164, as Exhibit 4(b)-3, in Form 8-K dated October 27, 1993, File No. 1-3164, as Exhibits 4(a) and 4(b), in Form 8-K dated November 16, 1993, File No. 1-3164, as Exhibit 4(a), in Certificate of Notification, File No. 70-8191, as Exhibit A, in Form 10-K for the year ended December 31, 1997, File No. 1-3164, as Exhibit 3(b)2, in Form 8-K dated August 10, 1998, File No. 1-3164, as Exhibit 4.4, in Form 10-K for the year ended December 31, 2000, File No. 1-3164, as Exhibit 3(b)2, in Form 10-K for the year ended December 31, 2001, File No. 1-3164, as Exhibit 3(b)2, in Form 8-K dated February 5, 2003, File No. 1-3164, as Exhibit 4.4, in Form 10-Q for the quarter ended March 31, 2003, File No 1-3164, as Exhibit 3(b)1, in Form 8-K dated February 5, 2004, File No. 1-3164, as Exhibit 4.4, in Form 10-Q for the quarter ended March 31, 2006, File No. 1-3164, as Exhibit 3(b)(1), in Form 8-K dated December 5, 2006, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated September 12, 2007, File No. 1-3164, as Exhibit 4.5, in Form 8-K dated October 17, 2007, File No. 1-3164, as Exhibit 4.5, and in Form 10-Q for the quarter ended March 31, 2008, File No. 1-3164, as Exhibit 3(b)1.)
|
|
|
|
|
(b)
|
|
2
|
|
—
|
|
Amended and Restated By-laws of Alabama Power effective February 10, 2014, and as presently in effect. (Designated in Form 8-K dated February 10, 2014, File No 1-3164, as Exhibit 3.1.)
|
|
|
Georgia Power
|
||||||||
|
|
|
(c)
|
|
1
|
|
—
|
|
Charter of Georgia Power and amendments thereto through October 9, 2007. (Designated in Registration Nos. 2-63392 as Exhibit 2(a)-2, 2-78913 as Exhibits 4(a)-(2) and 4(a)-(3), 2-93039 as Exhibit 4(a)-(2), 2-96810 as Exhibit 4(a)-2, 33-141 as Exhibit 4(a)-(2), 33-1359 as Exhibit 4(a)(2), 33-5405 as Exhibit 4(b)(2), 33-14367 as Exhibits 4(b)-(2) and 4(b)-(3), 33-22504 as Exhibits 4(b)-(2), 4(b)-(3) and 4(b)-(4), in Form 10-K for the year ended December 31, 1991, File No. 1-6468, as Exhibits 4(a)(2) and 4(a)(3), in Registration No. 33-48895 as Exhibits 4(b)-(2) and 4(b)-(3), in Form 8-K dated December 10, 1992, File No. 1-6468 as Exhibit 4(b), in Form 8-K dated June 17, 1993, File No. 1-6468, as Exhibit 4(b), in Form 8-K dated October 20, 1993, File No. 1-6468, as Exhibit 4(b), in Form 10-K for the year ended December 31, 1997, File No. 1-6468, as Exhibit 3(c)2, in Form 10-K for the year ended December 31, 2000, File No. 1-6468, as Exhibit 3(c)2, in Form 8-K dated June 27, 2006, File No. 1-6468, as Exhibit 3.1, and in Form 8-K dated October 3, 2007, File No. 1-6468, as Exhibit 4.5.)
|
|
|
|
|
(c)
|
|
2
|
|
—
|
|
By-laws of Georgia Power as amended effective November 9, 2016, and as presently in effect. (Designated in Form 8-K dated November 9, 2016, File No. 1-6468, as Exhibit 3.1.)
|
|
|
|
Gulf Power
|
||||||||
|
|
|
(d)
|
|
1
|
|
—
|
|
Amended and Restated Articles of Incorporation of Gulf Power and amendments thereto through June 17, 2013. (Designated in Form 8-K dated October 27, 2005, File No. 001-31737, as Exhibit 3.1, in Form 8-K dated November 9, 2005, File No. 001-31737, as Exhibit 4.7, in Form 8-K dated October 16, 2007, File No. 001-31737, as Exhibit 4.5, and in Form 8-K dated June 10, 2013, File No. 001-31737, as Exhibit 4.7.)
|
|
|
|
|
(d)
|
|
2
|
|
—
|
|
By-laws of Gulf Power as amended effective November 2, 2005, and as presently in effect. (Designated in Form 8-K dated October 27, 2005, File No. 001-31737, as Exhibit 3.2.)
|
|
|
|
Mississippi Power
|
||||||||
|
|
|
(e)
|
|
1
|
|
—
|
|
Articles of Incorporation of Mississippi Power, articles of merger of Mississippi Power Company (a Maine corporation) into Mississippi Power and articles of amendment to the articles of incorporation of Mississippi Power through April 2, 2004. (Designated in Registration No. 2-71540 as Exhibit 4(a)-1, in Form U5S for 1987, File No. 30-222-2, as Exhibit B-10, in Registration No. 33-49320 as Exhibit 4(b)-(1), in Form 8-K dated August 5, 1992, File No. 001-11229, as Exhibits 4(b)-2 and 4(b)-3, in Form 8-K dated August 4, 1993, File No. 001-11229, as Exhibit 4(b)-3, in Form 8-K dated August 18, 1993, File No. 001-11229, as Exhibit 4(b)-3, in Form 10-K for the year ended December 31, 1997, File No. 001-11229, as Exhibit 3(e)2, in Form 10-K for the year ended December 31, 2000, File No. 001-11229, as Exhibit 3(e)2, and in Form 8-K dated March 3, 2004, File No. 001-11229, as Exhibit 4.6.)
|
|
|
|
|
(e)
|
|
2
|
|
—
|
|
By-laws of Mississippi Power as amended effective October 25, 2016, and as presently in effect. (Designated in Form 8-K dated October 25, 2016, File No. 001-11229, as Exhibit 3.1)
|
|
|
|
Southern Power
|
||||||||
|
|
|
(f)
|
|
1
|
|
—
|
|
Certificate of Incorporation of Southern Power Company dated January 8, 2001. (Designated in Registration No. 333-98553 as Exhibit 3.1.)
|
|
|
|
|
(f)
|
|
2
|
|
—
|
|
By-laws of Southern Power Company effective January 8, 2001. (Designated in Registration No. 333-98553 as Exhibit 3.2.)
|
|
|
|
Southern Company Gas
|
||||||||
|
|
|
(f)
|
|
1
|
|
—
|
|
Amended and Restated Articles of Incorporation of Southern Company Gas dated July 11, 2016. (Designated in Form 8-K dated July 8, 2016, File No. 1-14174, as Exhibit 3.1.)
|
|
|
|
|
(f)
|
|
2
|
|
—
|
|
By-laws of Southern Company Gas effective July 11, 2016. (Designated in Form 8-K dated July 8, 2016, File No. 1-14174, as Exhibit 3.2.)
|
|
|
|
|
|
|
|
|
|
|
|
|
(4)
|
|
Instruments Describing Rights of Security Holders, Including Indentures
|
||||||||
|
|
With respect to each of Southern Company, Alabama Power, Georgia Power, Gulf Power, Mississippi Power, Southern Power Company, and Southern Company Gas such registrant has not included any instrument with respect to long-term debt that does not exceed 10% of the total assets of such registrant and its subsidiaries. Each such registrant agrees, upon request of the SEC, to furnish copies of any or all such instruments to the SEC.
|
|
|
Southern Company
|
||||||||
|
|
|
(a)
|
|
1
|
|
—
|
|
Senior Note Indenture dated as of January 1, 2007, between Southern Company and Wells Fargo Bank, National Association, as Trustee, and indentures supplemental thereto through May 24, 2016. (Designated in Form 8-K dated January 11, 2007, File No. 1-3526, as Exhibits 4.1 and 4.2, in Form 8-K dated March 20, 2007, File No. 1-3526, as Exhibit 4.2, in Form 8-K dated August 13, 2008, File No. 1-3526, as Exhibit 4.2, in Form 8-K dated May 11, 2009, File No. 1-3526, as Exhibit 4.2, in Form 8-K dated October 19, 2009, File No. 1-3526, as Exhibit 4.2, in Form 8-K dated September 13, 2010, File No. 1-3526, as Exhibit 4.2, in Form 8-K dated August 16, 2011, File No. 1-3526, as Exhibit 4.2, in Form 8-K dated August 21, 2013, File No. 1-3526, as Exhibit 4.2, in Form 8-K dated August 19, 2014, File No. 1-3526, as Exhibits 4.2(a) and 4.2(b), in Form 8-K dated June 9, 2015, File No. 1-3526, as Exhibit 4.2, and in Form 8-K dated May 19, 2016, File No. 1-3526, as Exhibits 4.2(a), 4.2(b), 4.2(c), 4.2(d), 4.2(e), 4.2(f) and 4.2(g).)
|
|
|
|
|
(a)
|
|
2
|
|
—
|
|
Subordinated Note Indenture dated as of October 1, 2015, between The Southern Company and Wells Fargo Bank, National Association, as Trustee, and indentures supplemental thereto through December 8, 2016. (Designated in Form 8-K dated October 1, 2015, File No. 1-3526, as Exhibits 4.3 and 4.4, in Form 8-K dated September 12, 2016, File No. 1-3526, as Exhibit 4.4, and in Form 8-K dated December 5, 2016, File No. 1-3526, as Exhibit 4.4.)
|
|
|
|
Alabama Power
|
||||||||
|
|
|
(b)
|
|
1
|
|
—
|
|
Subordinated Note Indenture dated as of January 1, 1997, between Alabama Power and Regions Bank, as Successor Trustee, and indentures supplemental thereto through October 2, 2002. (Designated in Form 8-K dated January 9, 1997, File No. 1-3164, as Exhibits 4.1 and 4.2, in Form 8-K dated February 18, 1999, File No. 1-3164, as Exhibit 4.2, and in Form 8-K dated September 26, 2002, File No. 3164, as Exhibits 4.9-A and 4.9-B.)
|
|
|
|
(b)
|
|
2
|
|
—
|
|
Senior Note Indenture dated as of December 1, 1997, between Alabama Power and Regions Bank, as Successor Trustee, and indentures supplemental thereto through January 13, 2016. (Designated in Form 8-K dated December 4, 1997, File No. 1-3164, as Exhibits 4.1 and 4.2, in Form 8-K dated February 20, 1998, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated April 17, 1998, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated August 11, 1998, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated September 8, 1998, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated September 16, 1998, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated October 7, 1998, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated October 28, 1998, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated November 12, 1998, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated May 19, 1999, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated August 13, 1999, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated September 21, 1999, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated May 11, 2000, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated August 22, 2001, File No. 1-3164, as Exhibits 4.2(a) and 4.2(b), in Form 8-K dated June 21, 2002, File No. 1-3164, as Exhibit 4.2(a), in Form 8-K dated October 16, 2002, File No. 1-3164, as Exhibit 4.2(a), in Form 8-K dated November 20, 2002, File No. 1-3164, as Exhibit 4.2(a), in Form 8-K dated December 6, 2002, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated February 11, 2003, File No. 1-3164, as Exhibits 4.2(a) and 4.2(b), in Form 8-K dated March 12, 2003, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated April 15, 2003, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated May 1, 2003, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated November 14, 2003, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated February 10, 2004, File No. 1-3164, as Exhibit 4.2 in Form 8-K dated April 7, 2004, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated August 19, 2004, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated November 9, 2004, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated March 8, 2005, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated January 11, 2006, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated January 13, 2006, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated February 1, 2006, File No. 1-3164, as Exhibits 4.2(a) and 4.2(b), in Form 8-K dated March 9, 2006, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated June 7, 2006, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated January 30, 2007, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated April 4, 2007, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated October 11, 2007, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated December 4, 2007, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated May 8, 2008, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated November 14, 2008, File No. 1-3164 as Exhibit 4.2, in Form 8-K dated February 26, 2009, File No. 1-3164 as Exhibit 4.2, in Form 8-K dated September 27, 2010, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated March 3, 2011, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated May 18, 2011, File No. 1-3164, as Exhibits 4.2(a) and 4.2(b), in Form 8-K dated January 10, 2012, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated October 9, 2012, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated November 27, 2012, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated December 3, 2013, File No. 1-3164, as Exhibit 4.2, in Form 8-K dated August 20, 2014, File No. 1-3164, as Exhibit 4.6, in Form 8-K dated March 5, 2015, File No. 1-3164, as Exhibit 4.6, in Form 8-K dated April 9, 2015, File No. 1-3164, as Exhibit 4.6(b), and in Form 8-K dated January 8, 2016, File No. 1-3164, as Exhibit 4.6.)
|
|
|
|
|
(b)
|
|
3
|
|
—
|
|
Amended and Restated Trust Agreement of Alabama Power Capital Trust V dated as of September 1, 2002. (Designated in Form 8-K dated September 26, 2002, File No. 1-3164, as Exhibit 4.12-B.)
|
|
|
|
|
(b)
|
|
4
|
|
—
|
|
Guarantee Agreement relating to Alabama Power Capital Trust V dated as of September 1, 2002. (Designated in Form 8-K dated September 26, 2002, File No. 1-3164, as Exhibit 4.16-B.)
|
|
|
Georgia Power
|
||||||||
|
|
|
(c)
|
|
1
|
|
—
|
|
Senior Note Indenture dated as of January 1, 1998, between Georgia Power and Wells Fargo Bank, National Association, as Successor Trustee, and indentures supplemental thereto through March 8, 2016. (Designated in Form 8-K dated January 21, 1998, File No. 1-6468, as Exhibits 4.1 and 4.2, in Forms 8-K each dated November 19, 1998, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated March 3, 1999, File No. 1-6469 as Exhibit 4.2, in Form 8-K dated February 15, 2000, File No. 1-6469 as Exhibit 4.2, in Form 8-K dated January 26, 2001, File No. 1-6469 as Exhibits 4.2(a) and 4.2(b), in Form 8-K dated February 16, 2001, File No. 1-6469 as Exhibit 4.2, in Form 8-K dated May 1, 2001, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated June 27, 2002, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated November 15, 2002, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated February 13, 2003, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated February 21, 2003, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated April 10, 2003, File No. 1-6468, as Exhibits 4.1, 4.2 and 4.3, in Form 8-K dated September 8, 2003, File No. 1-6468, as Exhibit 4.1, in Form 8-K dated September 23, 2003, File No. 1-6468, as Exhibit 4.1, in Form 8-K dated January 12, 2004, File No. 1-6468, as Exhibits 4.1 and 4.2, in Form 8-K dated February 12, 2004, File No. 1-6468, as Exhibit 4.1, in Form 8-K dated August 11, 2004, File No. 1-6468, as Exhibits 4.1 and 4.2, in Form 8-K dated January 13, 2005, File No. 1-6468, as Exhibit 4.1, in Form 8-K dated April 12, 2005, File No. 1-6468, as Exhibit 4.1, in Form 8-K dated November 30, 2005, File No. 1-6468, as Exhibit 4.1, in Form 8-K dated December 8, 2006, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated March 6, 2007, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated June 4, 2007, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated June 18, 2007, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated July 10, 2007, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated August 24, 2007, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated November 29, 2007, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated March 12, 2008, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated June 5, 2008, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated November 12, 2008, File No. 1-6468, as Exhibits 4.2(a) and 4.2(b), in Form 8-K dated February 4, 2009, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated December 8, 2009, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated March 9, 2010, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated May 24, 2010, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated August 26, 2010, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated September 20, 2010, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated January 13, 2011, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated April 12, 2011, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated February 29, 2012, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated May 8, 2012, File No. 1-6468, as Exhibit 4.2(b), in Form 8-K dated August 7, 2012, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated November 8, 2012, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated March 12, 2013, File No. 1-6468, as Exhibits 4.2(a) and 4.2(b), in Form 8-K dated August 12, 2013, File No. 1-6468, as Exhibit 4.2, in Form 8-K dated December 1, 2015, File No. 1-6468, as Exhibit 4.2, and in Form 8-K dated March 2, 2016, File No. 1-6468, as Exhibits 4.2(a) and 4.2(b).)
|
|
|
|
|
(c)
|
|
2
|
|
—
|
|
Loan Guarantee Agreement between Georgia Power and the DOE dated as of February 20, 2014, Amendment No. 1 thereto dated as of June 4, 2015, and Amendment No. 2 thereto dated as of March 9, 2016. (Designated in Form 8-K dated February 20, 2014, File No. 1-6468, as Exhibit 4.1, in Form 10-Q for the quarter ended June 30, 2015, File No. 1-6468, as Exhibit 10(c)1, and in Form 10-Q for the quarter ended March 31, 2016, File No. 1-6468, as Exhibit 4(c)3.)
|
|
|
|
|
(c)
|
|
3
|
|
—
|
|
Note Purchase Agreement among Georgia Power, the DOE, and the Federal Financing Bank dated as of February 20, 2014. (Designated in Form 8-K dated February 20, 2014, File No. 1-6468, as Exhibit 4.2.)
|
|
|
|
|
(c)
|
|
4
|
|
—
|
|
Future Advance Promissory Note dated February 20, 2014 made by Georgia Power to the FFB. (Designated in Form 8-K dated February 20, 2014, File No. 1-6468, as Exhibit 4.3.)
|
|
|
|
|
(c)
|
|
5
|
|
—
|
|
Deed to Secure Debt, Security Agreement and Fixture Filing between Georgia Power and PNC Bank, National Association, doing business as Midland Loan Services Inc., a division of PNC Bank, National Association dated as of February 20, 2014. (Designated in Form 8-K dated February 20, 2014, File No. 1-6468, as Exhibit 4.4.)
|
|
|
|
|
(c)
|
|
6
|
|
—
|
|
Owners Consent to Assignment and Direct Agreement and Amendment to Plant Alvin W. Vogtle Additional Units Ownership Participation Agreement by and among Georgia Power, OPC, MEAG Power, and Dalton dated as of February 20, 2014. (Designated in Form 8-K dated February 20, 2014, File No. 1-6468, as Exhibit 4.5.)
|
|
|
Gulf Power
|
||||||||
|
|
|
(d)
|
|
1
|
|
—
|
|
Senior Note Indenture dated as of January 1, 1998, between Gulf Power and Wells Fargo Bank, National Association, as Successor Trustee, and indentures supplemental thereto through September 23, 2014. (Designated in Form 8-K dated June 17, 1998, File No. 0-2429, as Exhibits 4.1 and 4.2, in Form 8-K dated August 17, 1999, File No. 0-2429, as Exhibit 4.2, in Form 8-K dated July 31, 2001, File No. 0-2429, as Exhibit 4.2, in Form 8-K dated October 5, 2001, File No. 0-2429, as Exhibit 4.2, in Form 8-K dated January 18, 2002, File No. 0-2429, as Exhibit 4.2, in Form 8-K dated March 21, 2003, File No. 0-2429, as Exhibit 4.2, in Form 8-K dated July 10, 2003, File No. 001-31737, as Exhibits 4.1 and 4.2, in Form 8-K dated September 5, 2003, File No. 001-31737, as Exhibit 4.1, in Form 8-K dated April 6, 2004, File No. 001-31737, as Exhibit 4.1, in Form 8-K dated September 13, 2004, File No. 001-31737, as Exhibit 4.1, in Form 8-K dated August 11, 2005, File No. 001-31737, as Exhibit 4.1, in Form 8-K dated October 27, 2005, File No. 001-31737, as Exhibit 4.1, in Form 8-K dated November 28, 2006, File No. 001-31737, as Exhibit 4.2, in Form 8-K dated June 5, 2007, File No. 001-31737, as Exhibit 4.2, in Form 8-K dated June 22, 2009, File No. 001-31737, as Exhibit 4.2, in Form 8-K dated April 6, 2010, File No. 001-31737, as Exhibit 4.2, in Form 8-K dated September 9, 2010, File No. 001-31737, as Exhibit 4.2, in Form 8-K dated May 12, 2011, File No. 001-31737, as Exhibit 4.2, in Form 8-K dated May 15, 2012, File No. 001-31737, as Exhibit 4.2, in Form 8-K dated June 10, 2013, File No. 001-31737, as Exhibit 4.2, and in Form 8-K dated September 16, 2014, File No. 001-31737, as Exhibit 4.2.)
|
|
|
|
Mississippi Power
|
||||||||
|
|
|
(e)
|
|
1
|
|
—
|
|
Senior Note Indenture dated as of May 1, 1998, between Mississippi Power and Wells Fargo Bank, National Association, as Successor Trustee, and indentures supplemental thereto through March 9, 2012. (Designated in Form 8-K dated May 14, 1998, File No. 001-11229, as Exhibits 4.1, 4.2(a) and 4.2(b), in Form 8-K dated March 22, 2000, File No. 001-11229, as Exhibit 4.2, in Form 8-K dated March 12, 2002, File No. 001-11229, as Exhibit 4.2, in Form 8-K dated April 24, 2003, File No. 001-11229, as Exhibit 4.2, in Form 8-K dated March 3, 2004, File No. 001-11229, as Exhibit 4.2, in Form 8-K dated June 24, 2005, File No. 001-11229, as Exhibit 4.2, in Form 8-K dated November 8, 2007, File No. 001-11229, as Exhibit 4.2, in Form 8-K dated November 14, 2008, File No. 001-11229, as Exhibit 4.2, in Form 8-K dated March 3, 2009, File No. 001-11229, as Exhibit 4.2, in Form 8-K dated October 11, 2011, File No. 001-11229, as Exhibits 4.2(a) and 4.2(b), and in Form 8-K dated March 5, 2012, File No. 001-11229, as Exhibit 4.2(b).)
|
|
|
|
|
(e)
|
|
2
|
|
—
|
|
Term Loan Agreement among Mississippi Power and the lenders identified therein, dated as of March 8, 2016. (Designated in Form 10-Q for the quarter ended March 31, 2016, File No. 001-11229, as Exhibit 4(e)1.)
|
|
|
|
Southern Power
|
||||||||
|
|
|
(f)
|
|
1
|
|
—
|
|
Senior Note Indenture dated as of June 1, 2002, between Southern Power Company and Wells Fargo Bank, National Association, as Successor Trustee, and indentures supplemental thereto through November 16, 2016. (Designated in Registration No. 333-98553 as Exhibits 4.1 and 4.2, in Form 10-Q for the quarter ended June 30, 2003, File No. 333-98553, as Exhibit 4(g)1, in Form 8-K dated November 13, 2006, File No. 333-98553, as Exhibit 4.2, in Form 8-K dated September 14, 2011, File No. 333-98553, as Exhibit 4.4, in Form 8-K dated July 10, 2013, File No. 333-98553, as Exhibit 4.4, in Form 8-K dated May 14, 2015, File No. 333-98553, as Exhibits 4.4(a) and 4.4(b), in Form 8-K dated November 12, 2015, File No. 333-98553, as Exhibits 4.4(a) and 4.4(b), in Form 8-K dated June 13, 2016, File No. 001-37803, as Exhibits 4.4(a) and 4.4(b), in Form 10-Q for the quarter ended September 30, 2016, File No. 001-37803, as Exhibits 4(f)1 and 4(f)2, and in Form 8-K dated November 10, 2016, File No. 001-37803, as Exhibits 4.4(a), 4.4(b), and 4.4(c).)
|
|
|
|
Southern Company Gas
|
||||||||
|
|
|
(g)
|
|
1
|
|
—
|
|
Indenture dated February 20, 2001 between AGL Capital Corporation, AGL Resources Inc. and The Bank of New York, as Trustee. (Designated in Form S-3, File No. 333-69500, as Exhibit 4.2.)
|
|
|
#
|
(a)
|
|
4
|
|
—
|
|
Southern Company Deferred Compensation Plan, Amended and Restated as of January 1, 2009, First Amendment thereto effective January 1, 2010, and Second Amendment thereto effective October 29, 2014. (Designated in Form 10-K for the year ended December 31, 2008, File No. 1-3526, as Exhibit 10(a)4, in Form 10-K for the year ended December 31, 2009, File No. 1-3526, as Exhibit 10(a)5, and in Form 10-K for the year ended December 31, 2015, File No. 1-3526, as Exhibit 10(a)21.)
|
|
|
|
#
|
(a)
|
|
5
|
|
—
|
|
The Southern Company Supplemental Executive Retirement Plan, Amended and Restated effective June 30, 2016. (Designated in Form 10-Q for the quarter ended June 30, 2016, File No. 1-3526, as Exhibit 10(a)1.)
|
|
|
|
#
|
(a)
|
|
6
|
|
—
|
|
The Southern Company Supplemental Benefit Plan, Amended and Restated effective as of June 30, 2016. (Designated in Form 10-Q for the quarter ended June 30, 2016, File No. 1-3526, as Exhibit 10(a)2.)
|
|
|
|
#
|
(a)
|
|
7
|
|
—
|
|
The Southern Company Change in Control Benefits Protection Plan (an amendment and restatement of The Southern Company Change in Control Benefit Plan Determination Policy), effective December 31, 2008. (Designated in Form 8-K dated December 31, 2008, File No. 1-3526, as Exhibit 10.1.)
|
|
|
|
#
|
(a)
|
|
8
|
|
—
|
|
Deferred Cash Compensation Trust Agreement for Directors of Southern Company and its Subsidiaries, Amended and Restated effective January 1, 2001, between Wells Fargo Bank, N.A., as successor to Wachovia Bank, N.A., Southern Company, SCS, Alabama Power, Georgia Power, Gulf Power, Mississippi Power, Southern LINC, Southern Company Energy Solutions, LLC, and Southern Nuclear and First Amendment thereto effective January 1, 2009. (Designated in Form 10-K for the year ended December 31, 2000, File No. 1-3526, as Exhibit 10(a)103 and in Form 10-K for the year ended December 31, 2008, File No. 1-3526, as Exhibit 10(a)16.)
|
|
|
|
#
|
(a)
|
|
9
|
|
—
|
|
Deferred Stock Trust Agreement for Directors of Southern Company and its Subsidiaries, Amended and Restated effective January 1, 2000, between Reliance Trust Company, Southern Company, Alabama Power, Georgia Power, Gulf Power, and Mississippi Power and First Amendment thereto effective January 1, 2009. (Designated in Form 10-K for the year ended December 31, 2000, File No. 1-3526, as Exhibit 10(a)104 and in Form 10-K for the year ended December 31, 2008, File No. 1-3526, as Exhibit 10(a)18.)
|
|
|
|
#
|
(a)
|
|
10
|
|
—
|
|
Deferred Cash Compensation Trust Agreement for Directors of Southern Company and its Subsidiaries, Amended and Restated effective September 1, 2001, between Wells Fargo Bank, N.A., as successor to Wachovia Bank, N.A., Southern Company, Alabama Power, Georgia Power, Gulf Power, and Mississippi Power and First Amendment thereto effective January 1, 2009. (Designated in Form 10-K for the year ended December 31, 2001, File No. 1-3526, as Exhibit 10(a)92 and in Form 10-K for the year ended December 31, 2008, File No. 1-3526, as Exhibit 10(a)20.)
|
|
|
|
#
|
(a)
|
|
11
|
|
—
|
|
Southern Company Senior Executive Change in Control Severance Plan, Amended and Restated effective December 31, 2008, First Amendment thereto effective October 19, 2009, and Second Amendment thereto effective February 22, 2011. (Designated in Form 10-K for the year ended December 31, 2008, File No. 1-3526, as Exhibit 10(a)23, in Form 10-K for the year ended December 31, 2009, File No. 1-3526, as Exhibit 10(a)22, and in Form 10-K for the year ended December 31, 2010, File No. 1-3526, as Exhibit 10(a)16.)
|
|
|
|
#
|
(a)
|
|
12
|
|
—
|
|
Southern Company Executive Change in Control Severance Plan, Amended and Restated effective December 31, 2008 and First Amendment thereto effective January 1, 2010. (Designated in Form 10-K for the year ended December 31, 2008, File No. 1-3526, as Exhibit 10(a)24 and in Form 10-K for the year ended December 31, 2009, File No. 1-3526, as Exhibit 10(a)24.)
|
|
|
|
#
|
(a)
|
|
13
|
|
—
|
|
Form of Terms for Performance Share Awards granted under the Southern Company 2011 Omnibus Incentive Compensation Plan. (Designated in Form 10-K for the year ended December 31, 2014, File No. 1-3526, as Exhibit 10(a)17).
|
|
|
|
#
|
(a)
|
|
14
|
|
—
|
|
Outside Directors Stock Plan for The Southern Company and its Subsidiaries effective June 1, 2015. (Designated in Definitive Proxy Statement filed April 10, 2015, File No. 1-3526, as Appendix A.)
|
|
|
|
|
(a)
|
|
15
|
|
—
|
|
Commitment Letter dated August 23, 2015. (Designated in Form 8-K dated August 23, 2015, File No. 1-3526, as Exhibit 10.1.)
|
|
|
|
|
(a)
|
|
16
|
|
—
|
|
Bridge Credit Agreement dated as of September 30, 2015, among Southern Company, as the Borrower, the Lenders identified therein, and Citibank, N.A., as Administrative Agent. (Designated in Form 8-K dated September 30, 2015, File No. 1-3526, as Exhibit 10.1.)
|
|
|
|
# *
|
(a)
|
|
17
|
|
—
|
|
Deferred Compensation Agreement between Southern Company, SCS, Alabama Power, and Mark A. Crosswhite, effective July 30, 2008.
|
|
|
#
|
(b)
|
|
18
|
|
—
|
|
Employment Agreement between Alabama Power and Steven R. Spencer effective April 1, 2016. (Designated in Form 10-K for the year ended December 31, 2015, File No. 1-3164, as Exhibit 10(b)21.
|
|
|
|
#
|
(b)
|
|
19
|
|
—
|
|
First Amendment to The Southern Company Supplemental Executive Retirement Plan effective January 1, 2017. See Exhibit 10(a)18 herein.
|
|
|
|
#
|
(b)
|
|
20
|
|
—
|
|
First Amendment to The Southern Company Supplemental Benefit Plan effective January 1, 2017. See Exhibit 10(a)19 herein.
|
|
|
|
Georgia Power
|
||||||||
|
|
|
(c)
|
|
1
|
|
—
|
|
Intercompany Interchange Contract as revised effective May 1, 2007, among Alabama Power, Georgia Power, Gulf Power, Mississippi Power, Southern Power Company, and SCS. See Exhibit 10(b)1 herein.
|
|
|
|
|
(c)
|
|
2
|
|
—
|
|
Revised and Restated Integrated Transmission System Agreement dated as of November 12, 1990, between Georgia Power and OPC. (Designated in Form 10-K for the year ended December 31, 1990, File No. 1-6468, as Exhibit 10(g).)
|
|
|
|
|
(c)
|
|
3
|
|
—
|
|
Revised and Restated Integrated Transmission System Agreement between Georgia Power and Dalton dated as of December 7, 1990. (Designated in Form 10-K for the year ended December 31, 1990, File No. 1-6468, as Exhibit 10(gg).)
|
|
|
|
|
(c)
|
|
4
|
|
—
|
|
Revised and Restated Integrated Transmission System Agreement between Georgia Power and MEAG Power dated as of December 7, 1990. (Designated in Form 10-K for the year ended December 31, 1990, File No. 1-6468, as Exhibit 10(hh).)
|
|
|
|
#
|
(c)
|
|
5
|
|
—
|
|
Southern Company 2011 Omnibus Incentive Compensation Plan effective May 25, 2011. See Exhibit 10(a)1 herein.
|
|
|
|
#
|
(c)
|
|
6
|
|
—
|
|
Form of Stock Option Award Agreement for Executive Officers of Southern Company under the Southern Company Omnibus Incentive Compensation Plan. See Exhibit 10(a)2 herein.
|
|
|
|
#
|
(c)
|
|
7
|
|
—
|
|
Southern Company Deferred Compensation Plan, Amended and Restated as of January 1, 2009, First Amendment thereto effective January 1, 2010, and Second Amendment thereto effective October 29, 2014. See Exhibit 10(a)4 herein.
|
|
|
|
#
|
(c)
|
|
8
|
|
—
|
|
The Southern Company Supplemental Executive Retirement Plan, Amended and Restated effective June 30, 2016. See Exhibit 10(a)5 herein.
|
|
|
|
#
|
(c)
|
|
9
|
|
—
|
|
The Southern Company Supplemental Benefit Plan, Amended and Restated effective as of June 30, 2016. See Exhibit 10(a)6 herein.
|
|
|
|
#
|
(c)
|
|
10
|
|
—
|
|
Southern Company Executive Change in Control Severance Plan, Amended and Restated effective December 31, 2008 and First Amendment thereto effective January 1, 2010. See Exhibit 10(a)12 herein.
|
|
|
|
#
|
(c)
|
|
11
|
|
—
|
|
Deferred Compensation Plan For Outside Directors of Georgia Power Company, Amended and Restated Effective January 1, 2008 and First Amendment thereto effective April 1, 2015. (Designated in Form 10-K for the year ended December 31, 2007, File No. 1-6468, as Exhibit 10(c)12 and in Form 10-Q for the quarter ended March 31, 2015, File No. 1-6468, as Exhibit 10(c)2.)
|
|
|
|
#
|
(c)
|
|
12
|
|
—
|
|
The Southern Company Change in Control Benefits Protection Plan (an amendment and restatement of The Southern Company Change in Control Benefit Plan Determination Policy), effective December 31, 2008. See Exhibit 10(a)7 herein.
|
|
|
|
#
|
(c)
|
|
13
|
|
—
|
|
Deferred Cash Compensation Trust Agreement for Directors of Southern Company and its Subsidiaries, Amended and Restated effective January 1, 2001, between Wells Fargo Bank, N.A., as successor to Wachovia Bank, N.A., Southern Company, SCS, Alabama Power, Georgia Power, Gulf Power, Mississippi Power, Southern LINC, Southern Company Energy Solutions, LLC, and Southern Nuclear and First Amendment thereto effective January 1, 2009. See Exhibit 10(a)8 herein.
|
|
|
|
#
|
(c)
|
|
14
|
|
—
|
|
Deferred Stock Trust Agreement for Directors of Southern Company and its Subsidiaries, Amended and Restated effective January 1, 2000, between Reliance Trust Company, Southern Company, Alabama Power, Georgia Power, Gulf Power, and Mississippi Power and First Amendment thereto effective January 1, 2009. See Exhibit 10(a)9 herein.
|
|
|
|
#
|
(c)
|
|
15
|
|
—
|
|
Deferred Cash Compensation Trust Agreement for Directors of Southern Company and its Subsidiaries, Amended and Restated effective September 1, 2001, between Wells Fargo Bank, N.A., as successor to Wachovia Bank, N.A., Southern Company, Alabama Power, Georgia Power, Gulf Power, and Mississippi Power and First Amendment thereto effective January 1, 2009. See Exhibit 10(a)10 herein.
|
|
|
#
|
(c)
|
|
16
|
|
—
|
|
Southern Company Senior Executive Change in Control Severance Plan, Amended and Restated effective December 31, 2008, First Amendment thereto effective October 19, 2009, and Second Amendment thereto effective February 22, 2011. See Exhibit 10(a)11 herein.
|
|
|
|
|
(c)
|
|
17
|
|
—
|
|
Engineering, Procurement and Construction Agreement, dated as of April 8, 2008, between Georgia Power, for itself and as agent for OPC, MEAG Power, and Dalton, as owners, and a consortium consisting of Westinghouse Electric Company LLC and Stone & Webster, Inc., as contractor, for Units 3 & 4 at the Vogtle Electric Generating Plant Site, Amendment No. 1 thereto dated as of December 11, 2009, Amendment No. 2 thereto dated as of January 15, 2010, Amendment No. 3 thereto dated as of February 23, 2010, Amendment No. 4 thereto dated as of May 2, 2011, Amendment No. 5 thereto dated as of February 7, 2012, Amendment No. 6 thereto dated as of January 23, 2014, Amendment No. 7 thereto dated as of January 6, 2016, and Amendment No. 8 thereto dated as of April 20, 2016. (Georgia Power requested confidential treatment for certain portions of these documents pursuant to applications for confidential treatment sent to the SEC. Georgia Power omitted such portions from the filings and filed them separately with the SEC.) (Designated in Form 10-Q/A for the quarter ended June 30, 2008, File No. 1-6468, as Exhibit 10(c)1, in Form 10-K for the year ended December 31, 2009, File No. 1-6468, as Exhibit 10(c)29, in Form 10-Q for the quarter ended March 31, 2010, File No. 1-6468, as Exhibits 10(c)1 and 10(c)2, in Form 10-Q for the quarter ended June 30, 2011, File No. 1-6468, as Exhibit 10(c)2, in Form 10-Q for the quarter ended March 31, 2012, File No. 1-6468, as Exhibit 10(c)2, in Form 10-Q for the quarter ended March 31, 2014, File No. 1-6468, as Exhibit 10(c)2, in Form 10-K for the year ended December 31, 2015, File No. 1-6468, as Exhibit 10(c)25, and in Form 10-Q for the quarter ended June 30, 2016, File No. 1-6468, as Exhibit 10(c)3.)
|
|
|
|
#
|
(c)
|
|
18
|
|
—
|
|
Form of Terms for Performance Share Awards granted under the Southern Company 2011 Omnibus Incentive Compensation Plan. See Exhibit 10(a)13 herein.
|
|
|
|
#
|
(c)
|
|
19
|
|
—
|
|
Deferred Compensation Agreement between Southern Company, Southern Company Services, Inc., and John L. Pemberton, effective October 10, 2008. (Designated in Form 10-Q for the quarter ended March 31, 2015, File No. 1-6468, as Exhibit 10(c)3.)
|
|
|
|
#
|
(c)
|
|
20
|
|
—
|
|
Outside Directors Stock Plan for The Southern Company and its Subsidiaries effective June 1, 2015. See Exhibit 10(a)14 herein.
|
|
|
|
#
|
(c)
|
|
21
|
|
—
|
|
First Amendment to The Southern Company Supplemental Executive Retirement Plan effective January 1, 2017. See Exhibit 10(a)18 herein.
|
|
|
|
#
|
(c)
|
|
22
|
|
—
|
|
First Amendment to The Southern Company Supplemental Benefit Plan effective January 1, 2017. See Exhibit 10(a)19 herein.
|
|
|
|
Gulf Power
|
||||||||
|
|
|
(d)
|
|
1
|
|
—
|
|
Intercompany Interchange Contract as revised effective May 1, 2007, among Alabama Power, Georgia Power, Gulf Power, Mississippi Power, Southern Power Company, and SCS. See Exhibit 10(b)1 herein.
|
|
|
|
#
|
(d)
|
|
2
|
|
—
|
|
Southern Company 2011 Omnibus Incentive Compensation Plan effective May 25, 2011. See Exhibit 10(a)1 herein.
|
|
|
|
#
|
(d)
|
|
3
|
|
—
|
|
Form of Stock Option Award Agreement for Executive Officers of Southern Company under the Southern Company Omnibus Incentive Compensation Plan. See Exhibit 10(a)2 herein.
|
|
|
|
#
|
(d)
|
|
4
|
|
—
|
|
Southern Company Deferred Compensation Plan, Amended and Restated as of January 1, 2009, First Amendment thereto effective January 1, 2010, and Second Amendment thereto effective October 29, 2014. See Exhibit 10(a)4 herein.
|
|
|
|
#
|
(d)
|
|
5
|
|
—
|
|
The Southern Company Supplemental Benefit Plan, Amended and Restated effective as of June 30, 2016. See Exhibit 10(a)6 herein.
|
|
|
|
#
|
(d)
|
|
6
|
|
—
|
|
Southern Company Executive Change in Control Severance Plan, Amended and Restated effective June 30, 2016 and First Amendment thereto effective January 1, 2010. See Exhibit 10(a)12 herein.
|
|
|
|
#
|
(d)
|
|
7
|
|
—
|
|
The Southern Company Supplemental Executive Retirement Plan, Amended and Restated effective June 30, 2016. See Exhibit 10(a)5 herein.
|
|
|
|
#
|
(d)
|
|
8
|
|
—
|
|
Deferred Compensation Plan For Outside Directors of Gulf Power Company, Amended and Restated effective January 1, 2008 and First Amendment thereto effective April 1, 2015. (Designated in Form 10-Q for the quarter ended March 31, 2008, File No. 0-2429, as Exhibit 10(d)1 and in Form 10-Q for the quarter ended June 30, 2015, File No. 001-11229, as Exhibit 10(d)1.)
|
|
|
|
#
|
(d)
|
|
9
|
|
—
|
|
The Southern Company Change in Control Benefits Protection Plan (an amendment and restatement of The Southern Company Change in Control Benefit Plan Determination Policy), effective December 31, 2008. See Exhibit 10(a)7 herein.
|
|
|
#
|
(e)
|
|
10
|
|
—
|
|
The Southern Company Change in Control Benefits Protection Plan (an amendment and restatement of The Southern Company Change in Control Benefit Plan Determination Policy), effective December 31, 2008. See Exhibit 10(a)7 herein.
|
|
|
|
#
|
(e)
|
|
11
|
|
—
|
|
Deferred Cash Compensation Trust Agreement for Directors of Southern Company and its Subsidiaries, Amended and Restated effective January 1, 2001, between Wells Fargo Bank, N.A., as successor to Wachovia Bank, N.A., Southern Company, SCS, Alabama Power, Georgia Power, Gulf Power, Mississippi Power, Southern LINC, Southern Company Energy Solutions, LLC, and Southern Nuclear and First Amendment thereto effective January 1, 2009. See Exhibit 10(a)8 herein.
|
|
|
|
#
|
(e)
|
|
12
|
|
—
|
|
Deferred Stock Trust Agreement for Directors of Southern Company and its Subsidiaries, Amended and Restated effective January 1, 2000, between Reliance Trust Company, Southern Company, Alabama Power, Georgia Power, Gulf Power, and Mississippi Power and First Amendment thereto effective January 1, 2009. See Exhibit 10(a)9 herein.
|
|
|
|
#
|
(e)
|
|
13
|
|
—
|
|
Deferred Cash Compensation Trust Agreement for Directors of Southern Company and its Subsidiaries, Amended and Restated effective September 1, 2001, between Wells Fargo Bank, N.A., as successor to Wachovia Bank, N.A., Southern Company, Alabama Power, Georgia Power, Gulf Power, and Mississippi Power and First Amendment thereto effective January 1, 2009. See Exhibit 10(a)10 herein.
|
|
|
|
#
|
(e)
|
|
14
|
|
—
|
|
Southern Company Senior Executive Change in Control Severance Plan, Amended and Restated effective December 31, 2008, First Amendment thereto effective October 19, 2009, and Second Amendment thereto effective February 22, 2011. See Exhibit 10(a)11 herein.
|
|
|
|
|
(e)
|
|
15
|
|
—
|
|
Cooperative Agreement between the DOE and SCS dated as of December 12, 2008. (Designated in Form 10-K for the year ended December 31, 2008, File No. 001-11229, as Exhibit 10(e)22.) (Mississippi Power requested confidential treatment for certain portions of this document pursuant to an application for confidential treatment sent to the SEC. Mississippi Power omitted such portions from this filing and filed them separately with the SEC.)
|
|
|
|
#
|
(e)
|
|
16
|
|
—
|
|
Form of Terms for Performance Share Awards granted under the Southern Company 2011 Omnibus Incentive Compensation Plan. See Exhibit 10(a)13 herein.
|
|
|
|
#
|
(e)
|
|
17
|
|
—
|
|
Amended Deferred Compensation Agreement effective December 31, 2008 between Southern Company, SCS, Georgia Power, Gulf Power and G. Edison Holland, Jr. (Designated in Form 10-Q for the quarter ended March 31, 2011, File No. 001-11229, as Exhibit 10(a)2.)
|
|
|
|
#
|
(e)
|
|
18
|
|
—
|
|
Outside Directors Stock Plan for The Southern Company and its Subsidiaries effective June 1, 2015. See Exhibit 10(a)14 herein.
|
|
|
|
#
|
(e)
|
|
19
|
|
—
|
|
Letter Agreement between Mississippi Power and Emile J. Troxclair III dated December 11, 2014. (Designated in Form 10-Q for the quarter ended March 31, 2016, File No. 001-11229, as Exhibit 10(e)1.)
|
|
|
|
#
|
(e)
|
|
20
|
|
—
|
|
Performance Award Agreement between Southern Company Services, Inc. and Emile J. Troxclair III effective as of January 3, 2015. (Designated in Form 10-Q for the quarter ended March 31, 2016, File No. 001-11229, as Exhibit 10(e)2.)
|
|
|
|
*
|
(e)
|
|
21
|
|
—
|
|
Promissory Note dated November 10, 2015 between Mississippi Power and Southern Company.
|
|
|
|
*
|
(e)
|
|
22
|
|
—
|
|
Amended and Restated Promissory Note dated December 22, 2015 between Mississippi Power and Southern Company.
|
|
|
|
*
|
(e)
|
|
23
|
|
—
|
|
Promissory Note dated January 28, 2016 between Mississippi Power and Southern Company.
|
|
|
|
#
|
(e)
|
|
24
|
|
—
|
|
First Amendment to The Southern Company Supplemental Executive Retirement Plan effective January 1, 2017. See Exhibit 10(a)18 herein.
|
|
|
|
#
|
(e)
|
|
25
|
|
—
|
|
First Amendment to The Southern Company Supplemental Benefit Plan effective January 1, 2017. See Exhibit 10(a)19 herein.
|
|
|
|
Southern Power
|
||||||||
|
|
|
(f)
|
|
1
|
|
—
|
|
Service contract dated as of January 1, 2001, between SCS and Southern Power Company. (Designated in Form 10-K for the year ended December 31, 2001, File No. 1-3526, as Exhibit 10(a)(2).)
|
|
|
|
|
(f)
|
|
2
|
|
—
|
|
Intercompany Interchange Contract as revised effective May 1, 2007, among Alabama Power, Georgia Power, Gulf Power, Mississippi Power, Southern Power Company, and SCS. See Exhibit 10(b)1 herein.
|
|
|
Gulf Power
|
||||||||
|
|
|
(d)
|
|
|
|
—
|
|
The Southern Company Code of Ethics. See Exhibit 14(a) herein.
|
|
|
|
Mississippi Power
|
||||||||
|
|
|
(e)
|
|
|
|
—
|
|
The Southern Company Code of Ethics. See Exhibit 14(a) herein.
|
|
|
|
Southern Power
|
||||||||
|
|
|
(f)
|
|
|
|
—
|
|
The Southern Company Code of Ethics. See Exhibit 14(a) herein.
|
|
|
|
Southern Company Gas
|
||||||||
|
|
|
(g)
|
|
|
|
—
|
|
The Southern Company Code of Ethics. See Exhibit 14(a) herein.
|
|
|
|
|
|
|
|
|
|
|
|
|
(21)
|
|
Subsidiaries of Registrants
|
||||||||
|
|
Southern Company
|
||||||||
|
|
*
|
(a)
|
|
|
|
—
|
|
Subsidiaries of Registrant.
|
|
|
|
Alabama Power
|
||||||||
|
|
|
(b)
|
|
|
|
—
|
|
Subsidiaries of Registrant. See Exhibit 21(a) herein.
|
|
|
|
Georgia Power
|
||||||||
|
|
|
(c)
|
|
|
|
—
|
|
Subsidiaries of Registrant. See Exhibit 21(a) herein.
|
|
|
|
Gulf Power
|
||||||||
|
|
|
(d)
|
|
|
|
—
|
|
Subsidiaries of Registrant. See Exhibit 21(a) herein.
|
|
|
|
Mississippi Power
|
||||||||
|
|
|
(e)
|
|
|
|
—
|
|
Subsidiaries of Registrant. See Exhibit 21(a) herein.
|
|
|
|
Southern Power
|
||||||||
|
|
|
Omitted pursuant to General Instruction I(2)(b) of Form 10-K.
|
|||||||
|
|
Southern Company Gas
|
||||||||
|
|
|
Omitted pursuant to General Instruction I(2)(b) of Form 10-K
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
(23)
|
|
Consents of Experts and Counsel
|
||||||||
|
|
Southern Company
|
||||||||
|
|
*
|
(a)
|
|
1
|
|
|
—
|
|
Consent of Deloitte & Touche LLP.
|
|
|
Alabama Power
|
||||||||
|
|
*
|
(b)
|
|
1
|
|
|
—
|
|
Consent of Deloitte & Touche LLP.
|
|
|
Georgia Power
|
||||||||
|
|
*
|
(c)
|
|
1
|
|
|
—
|
|
Consent of Deloitte & Touche LLP.
|
|
|
Gulf Power
|
||||||||
|
|
*
|
(d)
|
|
1
|
|
|
—
|
|
Consent of Deloitte & Touche LLP.
|
|
|
Southern Power
|
||||||||
|
|
*
|
(f)
|
|
1
|
|
|
—
|
|
Consent of Deloitte & Touche LLP.
|
|
|
Southern Company Gas
|
||||||||
|
|
*
|
(g)
|
|
1
|
|
|
—
|
|
Consent of Deloitte & Touche LLP.
|
|
|
*
|
(g)
|
|
2
|
|
|
—
|
|
Consent of PricewaterhouseCoopers LLP.
|
|
|
*
|
(g)
|
|
3
|
|
|
—
|
|
Consent of PricewaterhouseCoopers LLP.
|
|
|
|
|
|
|
|
|
|
|
|
(24)
|
|
Powers of Attorney and Resolutions
|
||||||||
|
|
Southern Company
|
||||||||
|
|
*
|
(a)
|
|
|
|
—
|
|
Power of Attorney and resolution.
|
|
|
|
Alabama Power
|
||||||||
|
|
*
|
(b)
|
|
|
|
—
|
|
Power of Attorney and resolution.
|
|
|
|
Georgia Power
|
||||||||
|
|
*
|
(c)
|
|
|
|
—
|
|
Power of Attorney and resolution.
|
|
|
Gulf Power
|
||||||||
|
|
*
|
(d)
|
|
|
|
—
|
|
Power of Attorney and resolution.
|
|
|
|
Mississippi Power
|
||||||||
|
|
*
|
(e)
|
|
|
|
—
|
|
Power of Attorney and resolution.
|
|
|
|
Southern Power
|
||||||||
|
|
*
|
(f)
|
|
|
|
—
|
|
Power of Attorney and resolution.
|
|
|
|
Southern Company Gas
|
||||||||
|
|
*
|
(g)
|
|
|
|
—
|
|
Power of Attorney and resolution.
|
|
|
|
|
|
|
|
|
|
|
|
|
(31)
|
|
Section 302 Certifications
|
||||||||
|
|
Southern Company
|
||||||||
|
|
*
|
(a)
|
|
1
|
|
—
|
|
Certificate of Southern Company's Chief Executive Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
*
|
(a)
|
|
2
|
|
—
|
|
Certificate of Southern Company's Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Alabama Power
|
||||||||
|
|
*
|
(b)
|
|
1
|
|
—
|
|
Certificate of Alabama Power's Chief Executive Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
*
|
(b)
|
|
2
|
|
—
|
|
Certificate of Alabama Power's Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Georgia Power
|
||||||||
|
|
*
|
(c)
|
|
1
|
|
—
|
|
Certificate of Georgia Power's Chief Executive Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
*
|
(c)
|
|
2
|
|
—
|
|
Certificate of Georgia Power's Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Gulf Power
|
||||||||
|
|
*
|
(d)
|
|
1
|
|
—
|
|
Certificate of Gulf Power's Chief Executive Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
*
|
(d)
|
|
2
|
|
—
|
|
Certificate of Gulf Power's Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Mississippi Power
|
||||||||
|
|
*
|
(e)
|
|
1
|
|
—
|
|
Certificate of Mississippi Power's Chief Executive Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
*
|
(e)
|
|
2
|
|
—
|
|
Certificate of Mississippi Power's Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Southern Power
|
||||||||
|
|
*
|
(f)
|
|
1
|
|
—
|
|
Certificate of Southern Power Company's Chief Executive Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
*
|
(f)
|
|
2
|
|
—
|
|
Certificate of Southern Power Company's Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Southern Company Gas
|
||||||||
|
|
*
|
(g)
|
|
1
|
|
—
|
|
Certificate of Southern Company Gas' Chief Executive Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
*
|
(g)
|
|
2
|
|
—
|
|
Certificate of Southern Company Gas' Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
|
|
|
|
|
|
|
(32)
|
|
Section 906 Certifications
|
||||||||
|
|
Southern Company
|
||||||||
|
|
*
|
(a)
|
|
|
|
—
|
|
Certificate of Southern Company's Chief Executive Officer and Chief Financial Officer required by Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Alabama Power
|
||||||||
|
|
*
|
(b)
|
|
|
|
—
|
|
Certificate of Alabama Power's Chief Executive Officer and Chief Financial Officer required by Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
Georgia Power
|
||||||||
|
|
*
|
(c)
|
|
|
|
—
|
|
Certificate of Georgia Power's Chief Executive Officer and Chief Financial Officer required by Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Gulf Power
|
||||||||
|
|
*
|
(d)
|
|
|
|
—
|
|
Certificate of Gulf Power's Chief Executive Officer and Chief Financial Officer required by Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Mississippi Power
|
||||||||
|
|
*
|
(e)
|
|
|
|
—
|
|
Certificate of Mississippi Power's Chief Executive Officer and Chief Financial Officer required by Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Southern Power
|
||||||||
|
|
*
|
(f)
|
|
|
|
—
|
|
Certificate of Southern Power Company's Chief Executive Officer and Chief Financial Officer required by Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
Southern Company Gas
|
||||||||
|
|
*
|
(g)
|
|
|
|
—
|
|
Certificate of Southern Company Gas' Chief Executive Officer and Chief Financial Officer required by Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
|
|
|
|
|
|
|
(99)
|
|
Additional Exhibits
|
||||||||
|
|
Southern Company Gas
|
||||||||
|
|
*
|
(g)
|
|
|
|
—
|
|
The financial statements of Southern Natural Gas Company, L.L.C., pursuant to Rule 3-09 of Regulation S-X.
|
|
|
|
|
|
|
|
|
|
|
|
|
(101)
|
XBRL-Related Documents
|
|||||||||
|
|
*
|
INS
|
|
|
—
|
|
XBRL Instance Document
|
||
|
|
*
|
SCH
|
|
|
—
|
|
XBRL Taxonomy Extension Schema Document
|
||
|
|
*
|
CAL
|
|
|
—
|
|
XBRL Taxonomy Calculation Linkbase Document
|
||
|
|
*
|
DEF
|
|
|
—
|
|
XBRL Definition Linkbase Document
|
||
|
|
*
|
LAB
|
|
|
—
|
|
XBRL Taxonomy Label Linkbase Document
|
||
|
|
*
|
PRE
|
|
|
—
|
|
XBRL Taxonomy Presentation Linkbase Document
|
|
|
|
|
When recorded return to:
|
|
|
|
David Hight, Esq.
|
|
Ice Miller LLP
|
|
2300 Cabot Drive
|
|
Suite 455
|
|
Lisle, IL 60532
|
|
|
|
|
|
|
Space Above this Line Reserved for Recorder’s Use Only
|
NO. RU-2016-A-__
|
$________
|
|
|
Ill. Commerce Commission No. 6694
|
CUSIP No. 665228 C@9
|
|
NORTHERN ILLINOIS GAS COMPANY
By:
Executive Vice President |
ATTEST:
Secretary |
|
NO. RU-2016-B-__
|
$________
|
|
|
Ill. Commerce Commission No. 6694
|
CUSIP No. 665228 C#7
|
|
NORTHERN ILLINOIS GAS COMPANY
By:
Executive Vice President |
ATTEST:
Secretary |
|
NO. RU-2016-C-__
|
$________
|
|
|
Ill. Commerce Commission No. 6694
|
CUSIP No. 665228 D*0
|
|
NORTHERN ILLINOIS GAS COMPANY
By:
Executive Vice President |
ATTEST:
Secretary |
|
NORTHERN ILLINOIS GAS COMPANY
By:
/s/ Paul R. Shlanta
Name: Paul R. Shlanta
Title: EVP and General Counsel
|
|
|
ATTEST:
By:
/s/ Myra C. Bierria
Name: Myra C. Bierria Title: Secretary |
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee
By:
/s/ Manjari Purkayastha
Name: Manjari Purkayastha
Title: Vice President
|
|
(Seal)
|
ATTEST:
By:
/s/ Valere Boyd
Name: Valere Boyd Title: Vice President |
|
/s/ Dione Edwards
|
|
Notary Public
|
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
|
|
County
|
Document No.
2
|
Date Recorded
|
Cook
|
|
|
Adams
|
|
|
Boone
|
|
|
Bureau
|
|
|
Carroll
|
|
|
Champaign
|
|
|
DeKalb
|
|
|
DeWitt
|
|
|
DuPage
|
|
|
Ford
|
|
|
Grundy
|
|
|
Hancock
|
|
|
Henderson
|
|
|
Henry
|
|
|
Iroquois
|
|
|
JoDaviess
|
|
|
Kane
|
|
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Kankakee
|
|
|
Kendall
|
|
|
Lake
|
|
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LaSalle
|
|
|
Lee
|
|
|
Livingston
|
|
|
McHenry
|
|
|
McLean
|
|
|
Mercer
|
|
|
Ogle
|
|
|
Piatt
|
|
|
Pike
|
|
|
Rock Island
|
|
|
Stephenson
|
|
|
Tazewell
|
|
|
Vermilion
|
|
|
Whiteside
|
|
|
Will
|
|
|
County
|
Document No.
2
|
Date Recorded
|
Winnebago
|
|
|
Woodford
|
|
|
If to Employee:
|
If to the Company:
|
Mark A. Crosswhite
3505 Brookwood Road
Birmingham, Alabama 35223
|
Gordon Martin
Senior Vice President and General
Counsel
Alabama Power Company
Bin # 18N-0001 CORP HDQS
600 North 18th Street
Birmingham, Alabama 35203
|
|
“SOUTHERN”
|
|
|
THE SOUTHERN COMPANY
|
|
|
By:
|
/s/Charles D. McCrary
|
|
Its:
|
Executive Vice President
|
|
|
|
|
“SCS”
|
|
|
SOUTHERN COMPANY SERVICES, INC.
|
|
|
By:
|
/s/C. Alan Martin
|
|
Its:
|
President & CEO
|
|
|
|
|
“COMPANY”
|
|
|
ALABAMA POWER COMPANY
|
|
|
By:
|
/s/Charles D. McCrary
|
|
Its:
|
President and CEO
|
|
|
|
|
“EMPLOYEE”
|
|
|
MARK A. CROSSWHITE
|
|
|
/s/Mark A. Crosswhite
|
|
|
|
|
|
|
|
|
ASSIGNOR
|
|
|
ALABAMA POWER COMPANY
|
|
|
By:
|
|
|
Its:
|
|
|
Date
|
|
|
|
|
|
ASSIGNEE
|
|
|
COMPANY
|
|
|
By:
|
|
|
Its:
|
|
|
Date
|
|
|
|
SOUTHERN COMPANY SERVICES, INC.
|
|
|
|
By:
|
/s/Stacy Kilcoyne
|
|
|
Its:
|
Human Resources Vice President
|
Attest:
|
|
|
|
By:
|
/s/Laura O. Hewett
|
|
|
Its:
|
Assistant Secretary
|
|
|
|
|
SOUTHERN COMPANY SERVICES, INC.
|
|
|
|
By:
|
/s/Stacy Kilcoyne
|
|
|
Its:
|
Human Resources Vice President
|
Attest:
|
|
|
|
By:
|
/s/Laura O. Hewett
|
|
|
Its:
|
Assistant Secretary
|
|
|
November 10, 2015
|
Up to $375,000,000
|
Date
|
Principal Borrowed
|
Principal Repaid
|
Notation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 22, 2015
|
$301,126,146.39
|
January 28, 2016
|
Up to $275,000,000
|
Date
|
Principal Borrowed
|
Principal Repaid
|
Notation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 Text – Code of Ethics
|
Safety and Health
We work safely, and we watch out for each other. Our goal is for everyone to go home healthy, every day. We do not compromise on safety. We complete required training, and we report and correct unsafe situations.
We keep our workplace safe for the well-being of employees, customers, contractors and the public. We also keep our workplace and work sites free from violence and prohibit the inappropriate use of alcohol and drugs.
|
Our Employees
Our employees make this a great place to work. We work together as a team, and everyone contributes to our success. We recognize and reward performance.
We treat each other with fairness, respect and dignity. We value and encourage different ideas and points of view. Inclusion and diversity are strengths that unlock our full potential.
We are an equal opportunity employer. We do not tolerate inappropriate conduct, intimidation, harassment or discrimination on any basis, including race, color, religion, sex, national origin, age, disability, veteran status, genetic information, sexual orientation, or gender identity or expression.
|
Our Relationships
We are known for the quality and value of our customer service. We tell the truth, keep our promises and deal fairly and ethically with others. Our goal is to establish and maintain relationships built on trust.
This goal guides all our business decisions. It extends to our customers, employees, vendors, contractors, regulators, stockholders and neighbors. We work to preserve the highest standards of integrity and objectivity. We expect our business partners to operate with ethical standards and values similar to our own.
|
The Environment
We take our environmental compliance responsibilities seriously. We support environmental stewardship efforts that protect and preserve our natural resources. The communities we serve are also home to our families and we strive to make them better.
|
Compliance with Laws and Regulations
Our reputation for doing the right thing is a valuable asset.
We respect and comply with all laws and regulations. We also comply with company policies and the Code of Ethics.
We provide training and resources to meet these expectations.
|
Financial Integrity
We are prudent with company funds. All business records and accounts will be complete, accurate and based on proper accounting principles. The records will be maintained as required by law and company policies. Any attempt to conceal, omit or make false entries in the records will not be tolerated.
We maintain appropriate internal controls to prevent and detect fraud. We will make full, fair, correct and timely disclosures in financial reports and other public communications.
|
Conflict of Interest
We avoid conflicts of interest. Our goal is to avoid even the appearance of a conflict between our work and personal interests.
Company resources are for business purposes and company-approved activities. We do not use our position, company resources or information for personal benefit. We do not compete with the company using personal or outside businesses. Any potential conflicts of interest must be disclosed promptly to management.
|
Gifts and Entertainment
We do not approve, accept or offer gifts, entertainment, or other favors unless they are a part of a reasonable business relationship. We use good judgment in offering hospitality to others to help preserve our reputation and that of our business partners. All gifts or entertainment given or accepted must be in compliance with all applicable laws and company policy.
|
Competitive Practices
We compete fairly, and vigorously, on the basis of price, superior service and value. We do not restrain trade, competition, prices, terms or markets.
We market, advertise and collect market data, fairly and honestly.
|
Confidential Information
We respect and protect the confidential information of our company, customers, employees, vendors and partners. We do not use confidential information in ways that conflict with laws, regulations or contracts.
We comply with copyright, patent and trademark rights.
|
Political Activities
We value and encourage citizenship. Employees have the freedom to choose whether or not to support political candidates, parties or positions, or to engage in political activities. The company will not tolerate pressuring employees to participate in political activities. Company resources will not be used to support political candidates, parties or committees unless permitted by law and company policy, and when approved in advance by executive management.
We do not offer or provide gifts or entertainment of any type, including meals and transportation, to any government employee or public official in the United States or internationally unless doing so is appropriate and legal. We never offer bribes or kickbacks.
Federal and state rules regarding gifts and entertainment for public officials and government employees can vary widely. This is also true when dealing with international businesses.
|
Duty to Act
All employees have a duty to act. We must promptly report any suspected violation of this Code, company policies or any applicable laws or regulations.
There are many ways employees can report issues – even anonymously. We investigate concerns and take appropriate action. Employees are expected to cooperate in investigations. The company does not tolerate retaliation in any form, against anyone who fulfills their duty to act.
Issues about questionable accounting practices, violations of internal accounting controls or auditing matters may be reported directly to the Southern Company Audit Committee.
|
Conclusion
Ethics means more than just obeying laws and following policies. It means taking personal responsibility to speak out when we see a possible violation of the Code.
Our Values and Code of Ethics challenge us to inspire and help others to act ethically. We should make the most of every opportunity to model the values and behavior that make this a great place to work.
|
This Code of Ethics applies to all employees, officers and board members of Southern Company, its subsidiaries and affiliates.
Annually, all employees are required to certify they received, read and will abide by the Code of Ethics, including their duty to act.
No waivers of the provisions of this Code of Ethics may be granted to board members, officers or employees without authorization from the appropriate compliance officer or in certain circumstances the Southern Company Board of Directors. Waivers will be disclosed as required by applicable law, regulation or rule.
|
This Code of Ethics
is a statement of policies for individual and business conduct and does not create any contractual right to current or future employment, employee benefits, or other terms and conditions of employment.
|
Name of Company
|
|
Jurisdiction of Organization
|
|
|
|
The Southern Company
|
|
Delaware
|
Alabama Power Company
|
|
Alabama
|
Alabama Power Capital Trust V
|
|
Delaware
|
Alabama Property Company
|
|
Alabama
|
Southern Electric Generating Company
|
|
Alabama
|
Georgia Power Company
|
|
Georgia
|
Piedmont-Forrest Corporation
|
|
Georgia
|
Southern Electric Generating Company
|
|
Alabama
|
Gulf Power Company
|
|
Florida
|
Mississippi Power Company
|
|
Mississippi
|
Southern Power Company
|
|
Delaware
|
Mankato Energy Center, LLC
|
|
Delaware
|
Mankato Energy Center II, LLC
|
|
Delaware
|
Nacogdoches Power, LLC
|
|
Delaware
|
Southern Company – Florida LLC
|
|
Delaware
|
Southern Company – Oleander LLC
|
|
Delaware
|
SP Oleander I, LLC
|
|
Delaware
|
SP Oleander II, LLC
|
|
Delaware
|
Oleander Power Project, LP(3)
|
|
Florida
|
Southern Renewable Energy, Inc.
|
|
Delaware
|
BNB Lamesa Solar LLC
|
|
Delaware
|
East Pecos Solar, LLC
|
|
Delaware
|
Grant Plains Wind, LLC
|
|
Delaware
|
Grant Wind, LLC
|
|
Delaware
|
Grant County Interconnect, LLC
|
|
Delaware
|
Kay Wind, LLC
|
|
Delaware
|
Passadumkeag Windpark, LLC
|
|
Delaware
|
Salt Fork Wind, LLC
|
|
Delaware
|
Tyler Bluff Wind Project, LLC
|
|
Delaware
|
Southern Turner Renewable Energy, LLC (4)
|
|
Delaware
|
Adobe Solar, LLC
|
|
Delaware
|
Apex Nevada Solar, LLC
|
|
Delaware
|
Calipatria, LLC
|
|
Delaware
|
Campo Verde Solar, LLC
|
|
Delaware
|
Granville Solar, LLC
|
|
Delaware
|
Macho Springs Solar, LLC
|
|
Delaware
|
Macho Springs Solar 2, LLC
|
|
Delaware
|
Morelos Solar, LLC
|
|
Delaware
|
Rutherford Farm, LLC
|
|
North Carolina
|
Southern Turner Cimarron I, LLC
|
|
Delaware
|
Southern Turner Cimarron Capital, LLC
|
|
Delaware
|
Spectrum Nevada Solar, LLC
|
|
Delaware
|
Southern Renewable Partnerships, LLC
|
|
Delaware
|
Desert Stateline Holdings, LLC (5)
|
|
Delaware
|
Desert Stateline, LLC
|
|
Delaware
|
Lost Hills Blackwell Holdings, LLC (6)
|
|
Delaware
|
Lost Hills Solar Holdco, LLC
|
|
Delaware
|
Lost Hills Solar, LLC
|
|
Delaware
|
Blackwell Solar Holdings, LLC
|
|
Delaware
|
Blackwell Solar, LLC
|
|
Delaware
|
NS Solar Holdings, LLC (6)
|
|
Delaware
|
North Star Solar, LLC
|
|
Delaware
|
SG2 Holdings, LLC (6)
|
|
Delaware
|
SG2 Imperial Valley LLC
|
|
Delaware
|
BSP Holding Company, LLC (6)
|
|
Delaware
|
Boulder Solar Power Parent, LLC
|
|
Delaware
|
Boulder Solar Power, LLC
|
|
Delaware
|
Parrey Holding Company, LLC (6)
|
|
Delaware
|
Parrey Parent, LLC
|
|
Delaware
|
Parrey, LLC
|
|
Delaware
|
RE Roserock Holdings LLC (6)
|
|
Delaware
|
RE Roserock LLC
|
|
Delaware
|
RE Silverlake Holdings LLC (6)
|
|
Delaware
|
RE Garland Holdings LLC
|
|
Delaware
|
RE Garland LLC
|
|
Delaware
|
RE Garland A LLC
|
|
Delaware
|
RE Tranquility Holdings LLC (6)
|
|
Delaware
|
RE Tranquility LLC
|
|
Delaware
|
RE Tranquility BAAH LLC
|
|
Delaware
|
WWH, LLC (7)
|
|
Delaware
|
Wake Wind Class B Holdings LLC
|
|
Delaware
|
Wake Wind Holdings LLC
|
|
Delaware
|
Wake Wind Energy LLC
|
|
Delaware
|
Southern Company Gas
|
|
Georgia
|
Southern Company Gas Capital Corporation
|
|
Nevada
|
AGL Investments Inc.
|
|
Georgia
|
Sequent LLC
|
|
Georgia
|
Atlanta Gas Light Company
|
|
Georgia
|
Georgia Natural Gas Company
|
|
Georgia
|
SouthStar Energy Services LLC
|
|
Delaware
|
NUI Corporation
|
|
New Jersey
|
Pivotal Utility Holdings Inc. (8)
|
|
New Jersey
|
Ottawa Acquisition LLC
|
|
Illinois
|
Northern Illinois Gas Company (9)
|
|
Illinois
|
Southern Company Gas Investments, Inc.
|
|
Georgia
|
Southern Company Gas Pipeline Holdings LLC
|
|
Georgia
|
Evergreen Enterprise Holdings LLC
|
|
Georgia
|
(1)
|
This information is as of December 31, 2016. In addition, this list omits certain subsidiaries pursuant to paragraph (b)(21)(ii) of Regulation S-K, Item 601.
|
(2)
|
SP Oleander II LLC owns 99% and SP Oleander I LLC owns 1%.
|
(3)
|
Grant County Interconnect, LLC owns 90.1% and Grant Plains Wind, LLC owns 9.1%.
|
(4)
|
Southern Renewable Energy, Inc. owns 90%.
|
(5)
|
Southern Renewable Partnership, LLC owns 100% of the class A membership interests and is entitled to 60% of all cash distributions.
|
(6)
|
Southern Renewable Partnership, LLC owns 100% of the class A membership interests and is entitled to 51% of all cash distributions.
|
(7)
|
Southern Renewable Partnership, LLC owns 90.1%.
|
(8)
|
Includes operations of three natural gas utilities: Elizabethtown Gas (New Jersey), Florida City Gas (Florida), and Elkton Gas (Maryland)
|
(9)
|
Doing business as Nicor Gas Company.
|
|
Yours very truly,
|
|
|
THE SOUTHERN COMPANY
|
|
|
By
|
/s/Thomas A. Fanning
|
|
|
Thomas A. Fanning
Chairman, President and
Chief Executive Officer
|
/s/Juanita Powell Baranco
Juanita Powell Baranco
|
/s/John D. Johns
John D. Johns
|
/s/Jon A. Boscia
Jon A. Boscia
|
/s/Dale E. Klein
Dale E. Klein
|
/s/Henry A. Clark III
Henry A. Clark III
|
/s/William G. Smith, Jr.
William G. Smith, Jr.
|
/s/Thomas A. Fanning
Thomas A. Fanning
|
/s/Steven R. Specker
Steven R. Specker
|
/s/David J. Grain
David J. Grain
|
/s/Larry D. Thompson
Larry D. Thompson
|
/s/Veronica M. Hagen
Veronica M. Hagen
|
/s/E. Jenner Wood III
E. Jenner Wood III
|
/s/Warren A. Hood, Jr.
Warren A. Hood, Jr.
|
/s/Art P. Beattie
Art P. Beattie
|
/s/Linda P. Hudson
Linda P. Hudson
|
/s/Ann P. Daiss
Ann P. Daiss
|
/s/Donald M. James
Donald M. James
|
|
Dated: February 21, 2017
|
THE SOUTHERN COMPANY
|
|
|
By
|
/s/Melissa K. Caen
|
|
|
Melissa K. Caen
Corporate Secretary
|
Mark A. Crosswhite
Chairman, President and
Chief Executive Officer
|
600 North 18th Street
Post Office Box 2641
Birmingham, Alabama 35291-0001
|
|
|
Tel 205.257.1000
Fax 205.257.5100
|
|
Art P. Beattie
30 Ivan Allen Jr. Blvd., N.W.
Atlanta, Georgia 30308
|
|
Melissa K. Caen
30 Ivan Allen Jr. Blvd., N.W.
Atlanta, Georgia 30308
|
|
Yours very truly,
|
|
|
ALABAMA POWER COMPANY
|
|
|
By
|
/s/Mark A. Crosswhite
|
|
|
Mark A. Crosswhite
Chairman, President and Chief Executive
Officer
|
/s/Whit Armstrong
Whit Armstrong
|
/s/Robert D. Powers
Robert D. Powers
|
/s/David J. Cooper, Sr.
David J. Cooper, Sr.
|
/s/Catherine J. Randall
Catherine J. Randall
|
/s/Mark A. Crosswhite
Mark A. Crosswhite
|
/s/C. Dowd Ritter
C. Dowd Ritter
|
/s/O. B. Grayson Hall, Jr.
O. B. Grayson Hall, Jr.
|
/s/R. Mitchell Shackleford III
R. Mitchell Shackleford III
|
/s/Anthony A. Joseph
Anthony A. Joseph
|
/s/Philip C. Raymond
Philip C. Raymond
|
/s/Patricia M. King
Patricia M. King
|
/s/Anita Allcorn-Walker
Anita Allcorn-Walker
|
/s/James K. Lowder
James K. Lowder
|
|
Dated: February 21, 2017
|
ALABAMA POWER COMPANY
|
|
|
By
|
/s/Melissa K. Caen
|
|
|
Melissa K. Caen
Assistant Secretary
|
|
Yours very truly,
|
|
|
GEORGIA POWER COMPANY
|
|
|
By
|
/s/W. Paul Bowers
|
|
|
W. Paul Bowers
Chairman, President and Chief Executive Officer
|
/s/W. Paul Bowers
W. Paul Bowers
|
/s/Charles K. Tarbutton
Charles K. Tarbutton
|
/s/Robert L. Brown, Jr.
Robert L. Brown, Jr.
|
/s/Beverly Daniel Tatum
Beverly Daniel Tatum
|
/s/Anna R. Cablik
Anna R. Cablik
|
/s/Clyde C. Tuggle
Clyde C. Tuggle
|
/s/Stephen S. Green
Stephen S. Green
|
/s/Richard W. Ussery
Richard W. Ussery
|
/s/Douglas J. Hertz
Douglas J. Hertz
|
/s/W. Ron Hinson
W. Ron Hinson
|
/s/Kessel D. Stelling, Jr.
Kessel D. Stelling, Jr.
|
/s/David P. Poroch
David P. Poroch
|
/s/Jimmy C. Tallent
Jimmy C. Tallent
|
|
|
|
Dated: February 21, 2017
|
|
GEORGIA POWER COMPANY
|
|
By
|
/s/Melissa K. Caen
|
|
|
Melissa K. Caen
Assistant Secretary
|
Mr. Art P. Beattie
The Southern Company
30 Ivan Allen Jr. Blvd., NW
Atlanta, GA 30308
|
Ms. Melissa K. Caen
Southern Company Services, Inc.
30 Ivan Allen Jr. Blvd., NW
Atlanta, GA 30308
|
/s/Allan G. Bense
Allan G. Bense
|
/s/J. Mort O’Sullivan, III
J. Mort O’Sullivan, III
|
/s/Deborah H. Calder
Deborah H. Calder
|
/s/Michael T. Rehwinkel
Michael T. Rehwinkel
|
/s/S. W. Connally, Jr.
S. W. Connally, Jr.
|
/s/Winston E. Scott
Winston E. Scott
|
/s/William C. Cramer, Jr.
William C. Cramer, Jr.
|
/s/Xia Liu
Xia Liu
|
/s/Julian B. MacQueen
Julian B. MacQueen
|
/s/Janet J. Hodnett
Janet J. Hodnett
|
|
/s/Susan D. Ritenour
Susan D. Ritenour
|
Dated: February 21, 2017
|
GULF POWER COMPANY
|
|
|
By
|
/s/Melissa K. Caen
|
|
|
Melissa K. Caen
Assistant Secretary
|
Mr. Art P. Beattie
The Southern Company
30 Ivan Allen Jr. Blvd., NW
Atlanta, GA 30308
|
Ms. Melissa K. Caen
Southern Company Services, Inc.
30 Ivan Allen Jr. Blvd., NW
Atlanta, GA 30308
|
MISSISSIPPI POWER COMPANY
|
|
|
By
|
/s/Anthony L. Wilson
|
|
|
Anthony L. Wilson
Chairman, President and Chief
Executive Officer
|
|
/s/Carl J. Chaney
Carl J. Chaney
|
/s/M. L. Waters
M. L. Waters
|
/s/L. Royce Cumbest
L. Royce Cumbest
|
/s/Anthony L. Wilson
Anthony L. Wilson
|
/s/Thomas A. Dews
Thomas A. Dews
|
/s/Moses H. Feagin
Moses H. Feagin
|
/s/Mark E. Keenum
Mark E. Keenum
|
/s/Cynthia F. Shaw
Cynthia F. Shaw
|
/s/Christine L. Pickering
Christine L. Pickering
|
/s/Vicki L. Pierce
Vicki L. Pierce
|
/s/Philip J. Terrell
Philip J. Terrell
|
|
Dated: February 21, 2017
|
MISSISSIPPI POWER COMPANY
|
|
|
By
|
/s/Melissa K. Caen
|
|
|
Melissa K. Caen
Assistant Secretary
|
Mr. Elliott L. Spencer
Southern Power Company
30 Ivan Allen Jr. Blvd, NW
Atlanta, GA 30308
|
Ms. Melissa K. Caen
Southern Company Services, Inc.
30 Ivan Allen Jr. Blvd, NW
Atlanta, GA 30308
|
|
Yours very truly,
|
|
|
SOUTHERN POWER COMPANY
|
|
|
By
|
/s/Joseph A. Miller
|
|
|
Joseph A. Miller
Chairman, President and
Chief Executive Officer
|
/s/Art P. Beattie
Art P. Beattie
|
/s/Joseph A. Miller
Joseph A. Miller
|
/s/Thomas A. Fanning
Thomas A. Fanning
|
/s/Christopher C. Womack
Christopher C. Womack
|
/s/Kimberly S. Greene
Kimberly S. Greene
|
/s/William C. Grantham
William C. Grantham
|
/s/James Y. Kerr, II
James Y. Kerr, II
|
/s/Elliott L. Spencer
Elliott L. Spencer
|
/s/Mark S. Lantrip
Mark S. Lantrip
|
|
Dated: February 21, 2017
|
SOUTHERN POWER COMPANY
|
|
|
By
|
/s/Melissa K. Caen
|
|
|
Melissa K. Caen
Assistant Secretary
|
|
Yours very truly,
|
|
|
SOUTHERN COMPANY GAS
|
|
|
By
|
/s/Andrew W. Evans
|
|
|
Andrew W. Evans
Chairman, President and
Chief Executive Officer
|
/s/Sandra N. Bane
Sandra N. Bane
|
/s/Kimberly S. Greene
Kimberly S. Greene
|
/s/Thomas D. Bell, Jr.
Thomas D. Bell, Jr.
|
/s/John E. Rau
John E. Rau
|
/s/Charles R. Crisp
Charles R. Crisp
|
/s/James A. Rubright
James A. Rubright
|
/s/Andrew W. Evans
Andrew W. Evans
|
/s/Elizabeth W. Reese
Elizabeth W. Reese
|
/s/Brenda J. Gaines
Brenda J. Gaines
|
/s/Grace A. Kolvereid
Grace A. Kolvereid
|
Dated: February 21, 2017
|
SOUTHERN COMPANY GAS
|
|
|
By
|
/s/Melissa K. Caen
|
|
|
Melissa K. Caen
Assistant Secretary
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1.
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I have reviewed this annual report on Form 10-K of The Southern Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/Thomas A. Fanning
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Thomas A. Fanning
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Chairman, President and
Chief Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of The Southern Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/Art P. Beattie
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Art P. Beattie
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Executive Vice President and Chief Financial Officer
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1.
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I have reviewed this annual report on Form 10-K of Alabama Power Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/Mark A. Crosswhite
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Mark A. Crosswhite
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Chairman, President and Chief Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of Alabama Power Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/Philip C. Raymond
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Philip C. Raymond
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Executive Vice President, Chief Financial Officer
and Treasurer
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1.
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I have reviewed this annual report on Form 10-K of Georgia Power Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/W. Paul Bowers
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W. Paul Bowers
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Chairman, President and Chief Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of Georgia Power Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/W. Ron Hinson
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W. Ron Hinson
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Executive Vice President, Chief Financial Officer and Treasurer
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1.
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I have reviewed this annual report on Form 10-K of Gulf Power Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/S. W. Connally, Jr.
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S. W. Connally, Jr.
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Chairman, President and Chief Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of Gulf Power Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/Xia Liu
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Xia Liu
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Vice President and Chief Financial Officer
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1.
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I have reviewed this annual report on Form 10-K of Mississippi Power Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/Anthony L. Wilson
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Anthony L. Wilson
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Chairman, President and
Chief Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of Mississippi Power Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/Moses H. Feagin
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Moses H. Feagin
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Vice President, Treasurer and
Chief Financial Officer
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|
1.
|
I have reviewed this annual report on Form 10-K of Southern Power Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/Joseph A. Miller
|
|
|
Joseph A. Miller
|
|
|
Chairman, President and Chief Executive Officer
|
|
1.
|
I have reviewed this annual report on Form 10-K of Southern Power Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/William C. Grantham
|
|
|
William C. Grantham
|
|
|
Senior Vice President, Treasurer and Chief
Financial Officer
|
|
1.
|
I have reviewed this annual report on Form 10-K of Southern Company Gas;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/Andrew W. Evans
|
|
|
Andrew W. Evans
|
|
|
Chairman, President and Chief Executive Officer
|
|
1.
|
I have reviewed this annual report on Form 10-K of Southern Company Gas;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/Elizabeth W. Reese
|
|
|
Elizabeth W. Reese
|
|
|
Executive Vice President and
Chief Financial Officer
|
|
(1)
|
such Annual Report on Form 10-K of The Southern Company for the year ended December 31, 2016, which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in such Annual Report on Form 10-K of The Southern Company for the year ended December 31, 2016, fairly presents, in all material respects, the financial condition and results of operations of The Southern Company.
|
|
/s/Thomas A. Fanning
|
|
Thomas A. Fanning
|
|
Chairman, President and
Chief Executive Officer
|
|
|
|
/s/Art P. Beattie
|
|
Art P. Beattie
|
|
Executive Vice President and
Chief Financial Officer
|
(1)
|
such Annual Report on Form 10-K of Alabama Power Company for the year ended December 31, 2016, which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in such Annual Report on Form 10-K of Alabama Power Company for the year ended December 31, 2016, fairly presents, in all material respects, the financial condition and results of operations of Alabama Power Company.
|
|
/s/Mark A. Crosswhite
|
|
Mark A. Crosswhite
|
|
Chairman, President and Chief Executive Officer
|
|
|
|
/s/Philip C. Raymond
|
|
Philip C. Raymond
|
|
Executive Vice President,
Chief Financial Officer and Treasurer
|
(1)
|
such Annual Report on Form 10-K of Georgia Power Company for the year ended December 31, 2016, which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in such Annual Report on Form 10-K of Georgia Power Company for the year ended December 31, 2016, fairly presents, in all material respects, the financial condition and results of operations of Georgia Power Company.
|
|
/s/W. Paul Bowers
|
|
W. Paul Bowers
|
|
Chairman, President and Chief Executive Officer
|
|
|
|
/s/W. Ron Hinson
|
|
W. Ron Hinson
|
|
Executive Vice President, Chief Financial Officer and Treasurer
|
(1)
|
such Annual Report on Form 10-K of Gulf Power Company for the year ended December 31, 2016, which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in such Annual Report on Form 10-K of Gulf Power Company for the year ended December 31, 2016, fairly presents, in all material respects, the financial condition and results of operations of Gulf Power Company.
|
|
/s/S. W. Connally, Jr.
|
|
S. W. Connally, Jr.
|
|
Chairman, President and Chief Executive Officer
|
|
|
|
/s/Xia Liu
|
|
Xia Liu
|
|
Vice President and Chief Financial Officer
|
(1)
|
such Annual Report on Form 10-K of Mississippi Power Company for the year ended December 31, 2016, which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in such Annual Report on Form 10-K of Mississippi Power Company for the year ended December 31, 2016, fairly presents, in all material respects, the financial condition and results of operations of Mississippi Power Company.
|
|
/s/Anthony L. Wilson
|
|
Anthony L. Wilson
|
|
Chairman, President and Chief Executive Officer
|
|
|
|
/s/Moses H. Feagin
|
|
Moses H. Feagin
|
|
Vice President, Treasurer and
Chief Financial Officer
|
(1)
|
such Annual Report on Form 10-K of Southern Power Company for the year ended December 31, 2016, which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in such Annual Report on Form 10-K of Southern Power Company for the year ended December 31, 2016, fairly presents, in all material respects, the financial condition and results of operations of Southern Power Company.
|
|
/s/Joseph A. Miller
|
|
Joseph A. Miller
|
|
Chairman, President and Chief Executive Officer
|
|
|
|
/s/William C. Grantham
|
|
William C. Grantham
|
|
Senior Vice President, Treasurer and
Chief Financial Officer
|
(1)
|
such Annual Report on Form 10-K of Southern Company Gas for the year ended December 31, 2016, which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in such Annual Report on Form 10-K of Southern Company Gas Company for the year ended December 31, 2016, fairly presents, in all material respects, the financial condition and results of operations of Southern Company Gas.
|
|
/s/Andrew W. Evans
|
|
Andrew W. Evans
|
|
Chairman, President and Chief Executive Officer
|
|
|
|
/s/Elizabeth W. Reese
|
|
Elizabeth W. Reese
|
|
Executive Vice President and
Chief Financial Officer
|
|
Page
Number
|
Report of Independent Registered Public Accounting Firm
|
1
|
|
|
Consolidated Financial Statements
|
|
Consolidated Statement of Income
|
2
|
Consolidated Balance Sheet
|
3
|
Consolidated Statement of Cash Flows
|
4
|
Consolidated Statement of Members' Equity
|
5
|
Notes to Consolidated Financial Statements
|
6
|
|
Four Months Ended
|
||
|
December 31, 2016
|
||
Revenues
|
$
|
230
|
|
|
|
||
Operating Costs and Expenses
|
|
||
Operations and maintenance
|
39
|
|
|
Depreciation and amortization
|
27
|
|
|
General and administrative
|
13
|
|
|
Taxes, other than income taxes
|
13
|
|
|
Total Operating Costs and Expenses
|
92
|
|
|
|
|
||
Operating Income
|
138
|
|
|
|
|
||
Other Income (Expense)
|
|
||
Earnings from equity investment
|
2
|
|
|
Interest, net
|
(26)
|
|
|
Other, net
|
1
|
|
|
Total Other Income (Expense)
|
(23)
|
|
|
|
|
||
Net Income
|
$
|
115
|
|
|
Four Months Ended
|
|||
|
December 31, 2016
|
|||
Cash Flows From Operating Activities
|
|
|||
Net income
|
$
|
115
|
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|||
Depreciation and amortization
|
27
|
|
|
|
Earnings from equity investment
|
(2)
|
|
|
|
Other non-cash items
|
1
|
|
|
|
Distributions from equity investment earnings
|
3
|
|
|
|
Changes in components of working capital:
|
|
|||
Accounts receivable
|
(7)
|
|
|
|
Regulatory assets
|
5
|
|
|
|
Accounts payable
|
10
|
|
|
|
Accrued taxes, other than income taxes
|
(4)
|
|
|
|
Accrued interest
|
(7)
|
|
|
|
Other current assets and liabilities
|
1
|
|
|
|
Other long-term assets and liabilities
|
(1)
|
|
|
|
Net Cash Provided by Operating Activities
|
141
|
|
|
|
|
|
|||
Cash Flows From Investing Activities
|
|
|||
Capital expenditures
|
(33)
|
|
|
|
Net Cash Used in Investing Activities
|
(33)
|
|
|
|
|
|
|||
Cash Flows From Financing Activities
|
|
|||
Issuance of debt
|
56
|
|
|
|
Payment of debt
|
(56)
|
|
|
|
Contributions from Members
|
15
|
|
|
|
Distributions to Members
|
(119)
|
|
|
|
Net Cash Used in Financing Activities
|
(104)
|
|
|
|
|
|
|||
Net Increase in Cash and Cash Equivalents
|
4
|
|
|
|
Cash and Cash Equivalents, beginning of period
|
—
|
|
|
|
Cash and Cash Equivalents, end of period
|
$
|
4
|
|
|
|
|
|||
Supplemental Disclosure of Cash Flow Information
|
|
|||
Cash paid during the period for interest (net of capitalized interest)
|
$
|
24
|
|
|
|
Four Months Ended
|
||
|
December 31, 2016
|
||
Beginning Balance
|
$
|
1,348
|
|
Net income
|
115
|
|
|
Contributions
|
15
|
|
|
Distributions
|
(119)
|
|
|
Ending Balance
|
$
|
1,359
|
|
|
Annual Depreciation Rates %
|
|
December 31, 2016
|
||
Transmission and storage facilities
|
0.9-2.25
|
|
$
|
3,570
|
|
General plant
|
3.33-20
|
|
25
|
|
|
Intangible plant
|
5-10
|
|
19
|
|
|
Other
|
|
|
116
|
|
|
Accumulated depreciation and amortization (a)
|
|
|
(1,344)
|
|
|
|
|
|
2,386
|
|
|
Land
|
|
|
12
|
|
|
Construction work in progress
|
|
|
53
|
|
|
Property, plant and equipment, net
|
|
|
$
|
2,451
|
|
(a)
|
The composite weighted average depreciation rate for the four months ended December 31, 2016 was approximately 2.3%.
|
|
December 31, 2016
|
||
5.90% Notes due April 2017(a)
|
$
|
500
|
|
4.40% Notes due June 2021
|
300
|
|
|
7.35% Notes due February 2031
|
153
|
|
|
8.00% Notes due March 2032
|
258
|
|
|
|
1,211
|
|
|
Less: Unamortized discount and debt issuance costs
|
5
|
|
|
Total debt
|
$
|
1,206
|
|
Less: Current portion of debt(a)
|
500
|
|
|
Total long-term debt
|
$
|
706
|
|
(a)
|
As of December 31, 2016, we included $500 million of our 5.90% Notes due April 2017 within the caption “Current portion of debt” on our accompanying Consolidated Balance Sheet. We intend to satisfy this debt through the issuance of bank or bond debt, issuance of notes to our Members, equity contributions from our Members, or a combination of these options.
|
•
|
total debt divided by earnings before interest, income taxes, depreciation and amortization may not exceed 5.00 to 1.00;
|
•
|
certain limitations on indebtedness, including payments and amendments;
|
•
|
certain limitations on entering into mergers, consolidations, sales of assets and investments;
|
•
|
limitations on granting liens; and
|
•
|
prohibitions on making any distributions if an event of default exists or would exist upon making such a distribution.
|
|
2016
|
|||
Change in postretirement benefit obligation:
|
|
|||
Postretirement benefit obligation - beginning of period
|
$
|
30
|
|
|
Interest cost(a)
|
—
|
|
|
|
Actuarial gain(a)
|
—
|
|
|
|
Benefits paid
|
(1)
|
|
|
|
Postretirement benefit obligation - end of period
|
$
|
29
|
|
|
Change in plan assets:
|
|
|||
Fair value of plan assets - beginning of period
|
$
|
57
|
|
|
Actual return on plan assets
|
2
|
|
|
|
Employer contributions/transfers
|
—
|
|
|
|
Benefits paid
|
(1)
|
|
|
|
Fair value of plan assets - end of period
|
$
|
58
|
|
|
Reconciliation of funded status:
|
|
|||
Fair value of plan assets
|
$
|
58
|
|
|
Less: Postretirement benefit obligation
|
29
|
|
|
|
Net asset at December 31(b)
|
$
|
29
|
|
|
(a)
|
Amounts during the four months ended December 31, 2016 were less than $500,000.
|
(b)
|
Net asset amounts are included in “Deferred charges and other assets” on our accompanying Consolidated Balance Sheet.
|
▪
|
Level 1 assets' fair values are based on quoted market prices for the instruments in actively traded markets. Included in this are equities and master limited partnerships using the quoted prices in actively traded markets;
|
▪
|
Level 2 assets' fair values are primarily based on pricing, data representative of quoted prices for similar assets in active markets (or identical assets in less active markets). Included in this are short term investment funds which are valued at cost plus calculated interest; and
|
▪
|
Plan assets with fair values that are based on the net asset value per share, or its equivalent (NAV), as reported by the issuers are determined based on the fair value of the underlying securities as of the valuation date and include private
|
|
Level 1
|
|
Level 2
|
|
Total
|
||||||||
Short-term investment fund (money market)
|
$
|
—
|
|
|
|
$
|
1
|
|
|
|
$
|
1
|
|
Equity securities, domestic
|
3
|
|
|
|
—
|
|
|
|
3
|
|
|||
Master limited partnerships
|
14
|
|
|
|
—
|
|
|
|
14
|
|
|||
Total assets in fair value hierarchy
|
$
|
17
|
|
|
|
$
|
1
|
|
|
|
$
|
18
|
|
|
|
|
|
|
|
||||||||
Investments measured at NAV(a)
|
|
|
|
|
40
|
|
|||||||
Investments at fair value
|
|
|
|
|
$
|
58
|
|
(a)
|
In accordance with Subtopic 820-10 of Accounting Standards Update (ASU) No. 2015-07,
Fair Value Measurement (Topic 820)
, certain Plan assets that were measured at NAV per share (or its equivalent) have not been classified in the fair value hierarchy. The fair value of the fixed income trusts as of December 31, 2016 is $15 million. The fair value of the private limited partnerships as of December 31, 2016 is $25 million.
|
Year
|
|
Total
|
||
2017
|
|
$
|
3
|
|
2018
|
|
3
|
|
|
2019
|
|
3
|
|
|
2020
|
|
3
|
|
|
2021
|
|
2
|
|
|
2022 - 2026
|
|
10
|
|
|
2016
|
|
|
(%)
|
|
Assumptions related to benefit obligations at December 31:
|
|
|
Discount rate
|
3.63
|
|
Assumptions related to benefit costs for the year ended December 31:
|
|
|
Discount rate for benefit obligations
|
3.82
|
|
Discount rate for interest on benefit obligations
|
2.98
|
|
Expected return on plan assets(a)
|
7.25
|
|
(a)
|
The expected return on plan assets listed in the table above is a pre-tax rate of return based on our portfolio of investments. We utilize an after-tax expected return on plan assets to determine our benefit costs, which is based on unrelated business income taxes with a weighted average rate of 21% for 2016.
|
|
Four Months Ended December 31, 2016
|
|||
Interest cost(a)
|
$
|
—
|
|
|
Expected return on plan assets
|
(1)
|
|
|
|
Amortization of prior service credit(a)
|
—
|
|
|
|
Net benefit income
|
$
|
(1)
|
|
|
(a)
|
Amounts during the four months ended December 31, 2016 were less than $500,000.
|
|
December 31, 2016
|
||
Accounts receivable
|
$
|
18
|
|
Natural gas imbalance receivable(a)
|
1
|
|
|
Accounts payable
|
9
|
|
(a)
|
Included in “Other current assets” on our accompanying Consolidated Balance Sheet.
|
|
Four Months Ended December 31, 2016
|
||
Revenues
|
$
|
67
|
|
Operations and maintenance
|
24
|
|
|
General and administrative
|
13
|
|
|
Capitalized costs
|
4
|
|
|
As of December 31, 2016
|
||||
|
Carrying
Amount
|
|
Estimated Fair Value
|
||
Total debt
|
$
|
1,206
|
|
|
$1,312
|
|
December 31, 2016
|
||
Current regulatory assets
|
|
||
Difference between gas retained and gas consumed in operations
|
$
|
3
|
|
Other
|
1
|
|
|
Total current regulatory assets
|
4
|
|
|
Non-current regulatory assets
|
|
||
Taxes on capitalized funds used during construction
|
24
|
|
|
Unamortized loss on reacquired debt
|
10
|
|
|
Other
|
2
|
|
|
Total non-current regulatory assets
|
36
|
|
|
Total regulatory assets
|
$
|
40
|
|
|
|
||
Current regulatory liabilities
|
|
||
Difference between gas retained and gas consumed in operations
|
$
|
1
|
|
Other
|
2
|
|
|
Total current regulatory liabilities (a)
|
3
|
|
|
Non-current regulatory liabilities
|
|
||
Postretirement benefits
|
19
|
|
|
Other
|
2
|
|
|
Total non-current regulatory liabilities (b)
|
21
|
|
|
Total regulatory liabilities
|
$
|
24
|
|
Year
|
|
Total
|
||
2017
|
|
$
|
1
|
|
2018
|
|
2
|
|
|
2019
|
|
2
|
|
|
2020
|
|
2
|
|
|
2021
|
|
2
|
|
|
Thereafter
|
|
13
|
|
|
Total
|
|
$
|
22
|
|