4. JOINT OWNERSHIP AGREEMENTS

Alabama Power owns an undivided interest in Units 1 and 2 at Plant Miller and related facilities jointly with Power South Energy Cooperative, Inc. Georgia Power owns undivided interests in Plants Vogtle, Hatch, Scherer, and Wansley in varying amounts jointly with OPC, MEAG Power, the City of Dalton, Georgia, Florida Power & Light Company, and Jacksonville Electric Authority. In addition, Georgia Power has joint ownership agreements with OPC for the Rocky Mountain facilities and with Florida Power Corporation for a combustion turbine unit at Intercession City, Florida. Southern Power owns an undivided interest in Plant Stanton Unit A and related facilities jointly with the Orlando Utilities Commission, Kissimmee Utility Authority, and Florida Municipal Power Agency.

At December 31, 2011, Alabama Power’s, Georgia Power’s, and Southern Power’s percentage ownership and investment (exclusive of nuclear fuel) in jointly owned facilities in commercial operation with the above entities were as follows:


Facility (Type)	Percent Ownership		Amount of Investment	Accumulated Depreciation

			(in millions)
Plant Vogtle (nuclear) Units 1 and 2		45.7%	$3,296	$1,962
Plant Hatch (nuclear)		50.1	978	545
Plant Miller (coal) Units 1 and 2		91.8	1,389	510
Plant Scherer (coal) Units 1 and 2		8.4	157	76
Plant Wansley (coal)		53.5	709	225
Rocky Mountain (pumped storage)		25.4	175	113
Intercession City (combustion turbine)		33.3	12	4
Plant Stanton (combined cycle) Unit A		65.0	154	27

At December 31, 2011, the portion of total construction work in progress related to Plants Miller, Scherer, and Wansley was $7 million, $63 million, and $36 million, respectively. Construction at Plants Miller, Wansley, and Scherer relates primarily to environmental projects.

Alabama Power, Georgia Power, and Southern Power have contracted to operate and maintain the jointly owned facilities, except for Rocky Mountain and Intercession City, as agents for their respective co-owners. The companies’ proportionate share of their plant operating expenses is included in the corresponding operating expenses in the statements of income and each company is responsible for providing its own financing.

JOINT OWNERSHIP AGREEMENTS

4. JOINT OWNERSHIP AGREEMENTS

The Company and Georgia Power own equally all of the outstanding capital stock of SEGCO, which owns electric generating units with a total rated capacity of 1,020 megawatts, as well as associated transmission facilities. The capacity of these units is sold equally to the Company and Georgia Power under a power contract. The Company and Georgia Power make payments sufficient to provide for the operating expenses, taxes, interest expense and a return on equity. The Company’s share of purchased power totaled $142 million in 2011, $101 million in 2010, and $82 million in 2009, and is included in “Purchased power from affiliates” in the statements of income. The Company accounts for SEGCO using the equity method.

In addition, the Company has guaranteed unconditionally the obligation of SEGCO under an installment sale agreement for the purchase of certain pollution control facilities at SEGCO’s generating units, pursuant to which $25 million principal amount of pollution control revenue bonds are outstanding. Also, the Company has guaranteed $50 million principal amount of unsecured senior notes issued by SEGCO for general corporate purposes. Georgia Power has agreed to reimburse the Company for the pro rata portion of such obligations corresponding to its then proportionate ownership of stock of SEGCO if the Company is called upon to make such payment under its guaranty.

At December 31, 2011, the capitalization of SEGCO consisted of $87 million of equity and $75 million of long-term debt on which the annual interest requirement is $3 million. SEGCO paid dividends of $15 million in 2011, $5 million in 2010, and none in 2009, of which one-half of each was paid to the Company. In addition, the Company recognizes 50% of SEGCO’s net income.

In addition to the Company’s ownership of SEGCO, the Company’s percentage ownership and investment in jointly-owned coal-fired generating plants at December 31, 2011 is as follows:


Facility	Total Megawatt Capacity		Company Ownership	Amount of Investment		Accumulated Depreciation

				(in millions)

Greene County		500	60.00%(1)		$ 148		$ 78
Plant Miller
Units 1 and 2		1,320	91.84%(2)		1,389		510

(1)	Jointly owned with an affiliate, Mississippi Power.

(2)	Jointly owned with PowerSouth.

At December 31, 2011, the Company’s portion of Plant Miller construction work in progress was $7.4 million.

The Company has contracted to operate and maintain the jointly owned facilities as agent for their co-owners. The Company’s proportionate share of its plant operating expenses is included in operating expenses in the statements of income and the Company is responsible for providing its own financing.

JOINT OWNERSHIP AGREEMENTS

4. JOINT OWNERSHIP AGREEMENTS

The Company and Alabama Power own equally all of the outstanding capital stock of SEGCO, which owns electric generating units with a total rated capacity of 1,020 megawatts, as well as associated transmission facilities. The capacity of these units is sold equally to the Company and Alabama Power under a power contract. The Company and Alabama Power make payments sufficient to provide for the operating expenses, taxes, interest expense, and a return on equity. The Company’s share of purchased power totaled $141 million in 2011, $100 million in 2010, and $87 million in 2009 and is included in purchased power from affiliates in the statements of income. The Company accounts for SEGCO using the equity method.

The Company owns undivided interests in Plants Vogtle, Hatch, Wansley, and Scherer in varying amounts jointly with OPC, MEAG Power, Dalton, Florida Power & Light Company, Jacksonville Electric Authority, and Gulf Power. Under these agreements, the Company has contracted to operate and maintain the plants as agent for the co-owners and is jointly and severally liable for third party claims related to these plants. In addition, the Company jointly owns the Rocky Mountain pumped storage hydroelectric plant with OPC who is the operator of the plant. The Company and Florida Power Corporation (Progress Energy Florida) jointly own a combustion turbine unit (Intercession City) operated by Progress Energy Florida.

At December 31, 2011, the Company’s percentage ownership and investment (exclusive of nuclear fuel) in jointly owned facilities in commercial operation with the above entities were as follows:


Facility (Type)	Company Ownership	Investment	Accumulated Depreciation

	(in millions)
Plant Vogtle (nuclear)
Units 1 and 2	45.7%	$3,296	$1,962
Plant Hatch (nuclear)	50.1	978	545
Plant Wansley (coal)	53.5	709	225
Plant Scherer (coal)
Units 1 and 2	8.4	157	76
Unit 3	75.0	1,108	373
Rocky Mountain (pumped storage)	25.4	175	113
Intercession City (combustion-turbine)	33.3	12	4

At December 31, 2011, the Company’s portion of construction work in progress related to environmental projects at Plants Wansley and Scherer was $36 million and $63 million, respectively. The Company’s proportionate share of its plant operating expenses is included in the corresponding operating expenses in the statements of income and the Company is responsible for providing its own financing.

JOINT OWNERSHIP AGREEMENTS

4. JOINT OWNERSHIP AGREEMENTS

The Company and Mississippi Power jointly own Plant Daniel Units 1 and 2, which together represent capacity of 1,000 MWs. Plant Daniel is a generating plant located in Jackson County, Mississippi. In accordance with the operating agreement, Mississippi Power acts as the Company’s agent with respect to the construction, operation, and maintenance of these units.

The Company and Georgia Power jointly own the 818 MWs capacity Plant Scherer Unit 3. Plant Scherer is a generating plant located near Forsyth, Georgia. In accordance with the operating agreement, Georgia Power acts as the Company’s agent with respect to the construction, operation, and maintenance of the unit.

The Company’s proportionate share of expenses related to both plants is included in the corresponding operating expense accounts in the statements of income and the Company is responsible for providing its own financing.

At December 31, 2011, the Company’s percentage ownership and investment in these jointly owned facilities were as follows:


	Plant Scherer Unit 3 (coal)				Plant Daniel Units 1 & 2 (coal)
	(in thousands)
Plant in service		$	366,747	^(a)		$	270,690
Accumulated depreciation			110,308				157,684
Construction work in progress			2,256				27,544
Ownership			25	%			50	%

(a)	Includes net plant acquisition adjustment of $2.5 million.

JOINT OWNERSHIP AGREEMENTS

4. JOINT OWNERSHIP AGREEMENTS

The Company and Alabama Power own, as tenants in common, Units 1 and 2 (total capacity of 500 MWs) at Greene County Steam Plant, which is located in Alabama and operated by Alabama Power. Additionally, the Company and Gulf Power, own as tenants in common, Units 1 and 2 (total capacity of 1,000 MWs) at Plant Daniel, which is located in Mississippi and operated by the Company.

At December 31, 2011, the Company’s percentage ownership and investment in these jointly owned facilities were as follows:


Generating Plant	Percent Ownership			Gross Investment			Accumulated Depreciation
				(in thousands)
Greene County
Units 1 and 2		40	%		$	88,319		$	42,274

Daniel
Units 1 and 2		50	%		$	286,722		$	142,376

The Company’s proportionate share of plant operating expenses is included in the statements of income and the Company is responsible for providing its own financing.

JOINT OWNERSHIP AGREEMENTS

4. JOINT OWNERSHIP AGREEMENTS

The Company is a 65% owner of Plant Stanton A, a combined-cycle project with a nameplate capacity of 630 MWs. The unit is co-owned by the OUC (28%), Florida Municipal Power Agency (3.5%), and Kissimmee Utility Authority (3.5%). The Company has a service agreement with SCS whereby SCS is responsible for the operation and maintenance of Plant Stanton A. As of December 31, 2011, $153.8 million was recorded in plant in service with associated accumulated depreciation of $26.8 million. These amounts represent the Company’s share of the total plant assets and each owner is responsible for providing its own financing. The Company’s proportionate share of Plant Stanton A’s operating expense is included in the corresponding operating expenses in the statements of income.