Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2017

Assets and Liabilities Measured at Fair Value on a Recurring Basis

As of September 30, 2017, assets and liabilities measured at fair value on a recurring basis during the period, together with their associated level of the fair value hierarchy, were as follows:



	Fair Value Measurements Using:
As of September 30, 2017:	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)
Southern Company
Assets:
Energy-related derivatives^(a)(b)	$	231	$	184	$	—	$	—	$	415
Interest rate derivatives	—		5		—		—		5
Foreign currency derivatives	—		103		—		—		103
Nuclear decommissioning trusts^(c)	752		1,004		—		26		1,782
Cash equivalents	1,271		—		—		—		1,271
Other investments	9		—		1		—		10
Total	$	2,263	$	1,296	$	1	$	26	$	3,586
Liabilities:
Energy-related derivatives^(a)(b)	$	265	$	146	$	—	$	—	$	411
Interest rate derivatives	—		24		—		—		24
Foreign currency derivatives	—		23		—		—		23
Contingent consideration	—		—		20		—		20
Total	$	265	$	193	$	20	$	—	$	478

Alabama Power
Assets:
Energy-related derivatives	$	—	$	9	$	—	$	—	$	9
Nuclear decommissioning trusts:^(d)
Domestic equity	422		81		—		—		503
Foreign equity	60		57		—		—		117
U.S. Treasury and government agency securities	—		27		—		—		27
Corporate bonds	19		150		—		—		169
Mortgage and asset backed securities	—		18		—		—		18
Private Equity	—		—		—		26		26
Other	—		8		—		—		8
Cash equivalents	808		—		—		—		808
Total	$	1,309	$	350	$	—	$	26	$	1,685
Liabilities:
Energy-related derivatives	$	—	$	7	$	—	$	—	$	7



	Fair Value Measurements Using:
As of September 30, 2017:	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)
Georgia Power
Assets:
Energy-related derivatives	$	—	$	18	$	—	$	—	$	18
Interest rate derivatives	—		1		—		—		1
Nuclear decommissioning trusts:^{(d) (e)}
Domestic equity	235		1		—		—		236
Foreign equity	—		156		—		—		156
U.S. Treasury and government agency securities	—		225		—		—		225
Municipal bonds	—		64		—		—		64
Corporate bonds	—		160		—		—		160
Mortgage and asset backed securities	—		38		—		—		38
Other	16		19		—		—		35
Cash equivalents	112		—		—		—		112
Total	$	363	$	682	$	—	$	—	$	1,045
Liabilities:
Energy-related derivatives	$	—	$	11	$	—	$	—	$	11
Interest rate derivatives	—		3		—		—		3
Total	$	—	$	14	$	—	$	—	$	14

Gulf Power
Assets:
Cash equivalents	$	21	$	—	$	—	$	—	$	21
Liabilities:
Energy-related derivatives	$	—	$	22	$	—	$	—	$	22

Mississippi Power
Assets:
Energy-related derivatives	$	—	$	3	$	—	$	—	$	3
Interest rate derivatives	—		2		—		—		2
Cash equivalents	209		—		—		—		209
Total	$	209	$	5	$	—	$	—	$	214
Liabilities:
Energy-related derivatives	$	—	$	7	$	—	$	—	$	7



	Fair Value Measurements Using:
As of September 30, 2017:	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)
Southern Power
Assets:
Energy-related derivatives	$	—	$	9	$	—	$	—	$	9
Foreign currency derivatives	—		103		—		—		103
Cash equivalents	90		—		—		—		90
Total	$	90	$	112	$	—	$	—	$	202
Liabilities:
Energy-related derivatives	$	—	$	4	$	—	$	—	$	4
Foreign currency derivatives	—		23		—		—		23
Contingent consideration	—		—		20		—		20
Total	$	—	$	27	$	20	$	—	$	47

Southern Company Gas
Assets:
Energy-related derivatives^(a)(b)	$	231	$	145	$	—	$	—	$	376
Liabilities:
Energy-related derivatives^(a)(b)	$	265	$	95	$	—	$	—	$	360


(a)	Excludes $13 million associated with certain weather derivatives accounted for based on intrinsic value rather than fair value.


(b)	Excludes cash collateral of $76 million.


(c)	For additional detail, see the nuclear decommissioning trusts sections for Alabama Power and Georgia Power in this table.


(d)	Excludes receivables related to investment income, pending investment sales, payables related to pending investment purchases, and currencies.


(e)	Includes the investment securities pledged to creditors and collateral received and excludes payables related to the securities lending program. As of September 30, 2017, approximately $66 million of the fair market value of Georgia Power's nuclear decommissioning trust funds' securities were on loan to creditors under the funds' managers' securities lending program.

Fair Value Measurements of Investments Calculated at Net Asset Value per Share as Well as the Nature and Risk of Those Investments

As of September 30, 2017, the fair value measurements of private equity investments held in the nuclear decommissioning trust that are calculated at net asset value per share (or its equivalent) as a practical expedient, as well as the nature and risks of those investments, were as follows:



As of September 30, 2017:	Fair Value		Unfunded Commitments		Redemption Frequency	Redemption Notice Period
	(in millions)
Southern Company	$	26	$	24	Not Applicable	Not Applicable
Alabama Power	$	26	$	24	Not Applicable	Not Applicable

Financial Instruments for Which Carrying Amount Did Not Equal Fair Value

As of September 30, 2017, other financial instruments for which the carrying amount did not equal fair value were as follows:



	Carrying Amount		Fair Value
	(in millions)
Long-term debt, including securities due within one year:
Southern Company	$	47,269	$	49,348
Alabama Power	$	7,404	$	8,031
Georgia Power	$	11,713	$	12,237
Gulf Power	$	1,292	$	1,352
Mississippi Power	$	2,123	$	2,117
Southern Power	$	5,810	$	5,916
Southern Company Gas	$	5,862	$	6,230