RETIREMENT BENEFITS

Southern Company has a defined benefit, trusteed, pension plan covering substantially all employees. The qualified pension plan is funded in accordance with requirements of the Employee Retirement Income Security Act of 1974, as amended. No mandatory contributions to the qualified pension plan are anticipated for the year ending December 31, 2014. Southern Company also provides certain defined benefit pension plans for a selected group of management and highly compensated employees. Benefits under these non-qualified pension plans are funded on a cash basis. In addition, Southern Company provides certain medical care and life insurance benefits for retired employees through other postretirement benefit plans. The traditional operating companies fund related other postretirement trusts to the extent required by their respective regulatory commissions.

See Note 2 to the financial statements of Southern Company, Alabama Power, Georgia Power, Gulf Power, and Mississippi Power in Item 8 of the Form 10-K for additional information.

Components of the net periodic benefit costs for the three and nine months ended September 30, 2014 and 2013 were as follows:



Pension Plans	Southern Company			Alabama Power			Georgia Power			Gulf Power			Mississippi Power
	(in millions)
Three Months Ended September 30, 2014
Service cost	$	53		$	12		$	16		$	4		$	3
Interest cost	109			26			39			4			5
Expected return on plan assets	(161		)	(42		)	(57		)	(7		)	(8		)
Amortization:
Prior service costs	6			2			2			—			—
Net (gain)/loss	28			7			10			1			2
Net cost	$	35		$	5		$	10		$	2		$	2
Nine Months Ended September 30, 2014
Service cost	$	160		$	36		$	47		$	8		$	8
Interest cost	326			78			115			14			15
Expected return on plan assets	(484		)	(126		)	(170		)	(21		)	(22		)
Amortization:
Prior service costs	19			5			7			1			1
Net (gain)/loss	83			23			30			3			4
Net cost	$	104		$	16		$	29		$	5		$	6
Three Months Ended September 30, 2013
Service cost	$	58		$	12		$	17		$	3		$	3
Interest cost	97			23			35			4			5
Expected return on plan assets	(151		)	(39		)	(54		)	(6		)	(7		)
Amortization:
Prior service costs	7			2			3			—			1
Net (gain)/loss	50			13			19			2			2
Net cost	$	61		$	11		$	20		$	3		$	4
Nine Months Ended September 30, 2013
Service cost	$	174		$	39		$	52		$	8		$	8
Interest cost	291			69			104			13			14
Expected return on plan assets	(452		)	(117		)	(160		)	(19		)	(20		)
Amortization:
Prior service costs	20			5			8			1			1
Net (gain)/loss	150			39			56			6			7
Net cost	$	183		$	35		$	60		$	9		$	10



Postretirement Benefits	Southern Company			Alabama Power			Georgia Power			Gulf Power			Mississippi Power
	(in millions)
Three Months Ended September 30, 2014
Service cost	$	5		$	1		$	2		$	—		$	—
Interest cost	19			5			9			—			—
Expected return on plan assets	(14		)	(6		)	(6		)	—			—
Amortization:
Prior service costs	1			1			—			—			—
Net (gain)/loss	1			—			—			—			—
Net cost	$	12		$	1		$	5		$	—		$	—
Nine Months Ended September 30, 2014
Service cost	$	16		$	4		$	5		$	1		$	1
Interest cost	59			15			26			2			2
Expected return on plan assets	(44		)	(19		)	(19		)	(1		)	(1		)
Amortization:
Prior service costs	3			3			—			—			—
Net (gain)/loss	2			—			1			—			—
Net cost	$	36		$	3		$	13		$	2		$	2
Three Months Ended September 30, 2013
Service cost	$	6		$	2		$	3		$	—		$	—
Interest cost	18			5			8			1			1
Expected return on plan assets	(14		)	(6		)	(7		)	(1		)	—
Amortization:
Transition obligation	2			—			1			—			—
Prior service costs	1			1			—			—			—
Net (gain)/loss	3			—			2			—			—
Net cost	$	16		$	2		$	7		$	—		$	1
Nine Months Ended September 30, 2013
Service cost	$	18		$	5		$	6		$	1		$	1
Interest cost	55			14			24			2			3
Expected return on plan assets	(42		)	(18		)	(19		)	(1		)	(1		)
Amortization:
Transition obligation	4			—			3			—			—
Prior service costs	3			3			—			—			—
Net (gain)/loss	9			1			6			—			—
Net cost	$	47		$	5		$	20		$	2		$	3