Southern Company

• 1. Corporate Origins And Evolution

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  The year 1924 marked the birth of a holding company called Southeastern Power & Light. This entity was formed to manage Alabama Traction, Light and Power, which had been established in 1906. Later that same year, the group created Mississippi Power as a subsidiary. Gulf Power joined the family in 1925. In 1926, Southeastern Power & Light merged with Georgia Power, an organization founded in 1902. By 1930, this system became part of Commonwealth & Southern Corporation. The new structure included five Northern companies and six Southern companies. However, federal regulations changed everything in the late 1940s. The Public Utility Holding Company Act of 1935 forced the dissolution of Commonwealth & Southern. Four operating companies from the Deep South were allowed to remain under common ownership. These entities were Alabama Power, Georgia Power, Gulf Power, and Mississippi Power. A new holding company named Southern Company was incorporated in Delaware on the 9th of November 1945. It commenced operation in 1949 and moved its headquarters to Georgia in 1950. The company expanded significantly over the decades. In 1981, it became the first electric utility holding company in 46 years to diversify operations by forming an unregulated subsidiary. This new entity was called Southern Energy, Inc., and began official operations in January 1982. It grew to serve ten countries across four continents. On the 2nd of April 2001, Southern Company completed the spinoff of Southern Energy as Mirant Corporation. Another subsidiary, Southern Nuclear, began providing services in 1991 to the system's nuclear power plants. In 1996, Southern Communications Services started offering digital wireless communications services to subsidiaries and marketed them publicly as Southern Linc. Southern Telecom was founded in 1997 to provide colocation and dark fiber optic lines. On the 9th of January 2001, the Securities and Exchange Commission approved the formation of Southern Power to own wholesale generating assets. In June 2012, the Nacogdoches Generating Facility began commercial operation near Sacul in Texas. It is a 115 MW biomass-fueled plant. In 2016, Southern Company acquired AGL Resources for $12 billion. This takeover doubled its customer base to approximately nine million people.

• 2. Subsidiary Portfolio Structure

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  Southern Company operates through a complex web of subsidiaries that manage different aspects of energy delivery. Alabama Power serves the southern two-thirds of Alabama from its base in Birmingham. Georgia Power covers all of Georgia except mostly rural counties from Atlanta. Mississippi Power operates along the Gulf Coast of Mississippi with headquarters in Gulfport. These three retail companies serve customers across three states. Southern Power provides electricity to wholesale customers throughout the country. Southern Company Gas delivers utility gas to customers in seven states. Southern Nuclear handles engineering and operations for nuclear power plants including Farley, Hatch, and Vogtle. The company owns Southern Company Generation which manages fossil fuels and hydro operations. Southern Telecom offers wholesale fiber optic communications and data services from Atlanta. Southern Natural Gas Company runs a 6,900-mile pipeline system as a joint venture with Kinder Morgan. PowerSecure focuses on distributed infrastructure technologies based in Wake Forest, North Carolina. Atlanta Gas Light provides natural gas delivery to more than 1.6 million customers in Georgia. Chattanooga Gas serves approximately 66,000 customers in Hamilton and Bradley counties in Tennessee. Nicor Gas supplies natural gas throughout northern Illinois. Virginia Natural Gas provides service in southeastern Virginia. Sequent Energy Management optimizes natural gas assets and transportation services. Southern Wholesale Energy markets surplus generating capacity to the wholesale market. Southern Company Transmission conducts business under an Open Access Transmission Tariff approved by FERC. Prior to 2019, the company owned Gulf Power in Pensacola, Florida. An agreement reached in May 2018 sold Gulf Power to NextEra Energy for $6.5 billion. The sale was completed on the 1st of January 2019.

• 3. Nuclear Expansion At Vogtle

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  Plant Vogtle sits near Augusta, Georgia, where two new nuclear reactors are being constructed. In June 2010, the United States Department of Energy awarded an $8.3 billion loan guarantee to facilitate this construction project. Georgia Power owns 45.7% of the current 2,430 MW facility. Co-owners include Oglethorpe Power at 30%, Municipal Electric Authority of Georgia at 22.7%, and the City of Dalton at 1.6%. The plant is operated by Georgia Power. The $14 billion construction project was originally scheduled to be completed by 2022. This effort would double the plant's capacity. Energy Secretary Steven Chu called it the first new nuclear power plant to break ground in decades. It was expected to create up to 3,500 jobs during construction and 800 once operational. However, significant delays occurred. In March 2017, Westinghouse Electric Company filed for Chapter 11 bankruptcy due to losses from its U.S. nuclear projects. The company had incurred $9 billion in losses. Commercial operations of Unit 3 began in July 2023. Unit 4’s commercial operations started in April 2024. These added reactors will supply enough energy for about one million customers. The project faced scrutiny over lengthy delays and ballooning costs. In June 2021, the Georgia Public Service Commission examined the situation closely.

• 4. Clean Coal Technology Trials

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  The Kemper County Energy Facility represents a bold attempt at clean coal technology. Southern Company broke ground on this 21st-century facility in June 2010. Mississippi Power operates the plant which takes advantage of abundant lignite available in Mississippi. The project employs Transport Gasifier or TRIG technology. This system uses dry-feed non-slag gasifiers that operate at lower temperatures than other coal gasifiers. Crushed material is heated and circulated to produce flammable synthetic gas known as syngas. Syngas can generate electricity with fewer emissions. Other byproducts like ammonia and sulphuric acid are produced and sold for commercial use. Between 2010 and 2014, the US Department of Energy invested $270 million in this project. Southern Company anticipated the plant would serve more than 187,000 customers. It was expected to strip out at least 65% of carbon dioxide emissions. However, the project suffered repeated delays and cost increases from $2.88 billion to $6.58 billion. In February 2015, the Mississippi Supreme Court ordered Mississippi Power to restore $377 million to ratepayers. In May 2016, the Securities and Exchange Commission investigated overruns related to the Kemper Project. Recorded conversations showed engineers claiming mismanagement caused delays and safety violations. Treetop Midstream Services sued Mississippi Power in June 2016 over a cancelled contract for carbon dioxide delivery. The company also unlawfully fired a whistle-blower who criticized false statements by management.