Financing

12 Months Ended

Dec. 31, 2017

Securities Due Within One Year

A summary of scheduled maturities of securities due within one year at December 31 was as follows:



	2017			2016
	(in millions)
Senior notes	$	2,354		$	1,995
Other long-term debt	1,420			485
Revenue bonds^(*)	90			76
Capitalized leases	31			32
Unamortized debt issuance expense/discount	(3		)	(1		)
Total	$	3,892		$	2,587


(*)	Includes $50 million in revenue bonds classified as short term at December 31, 2017 that were remarketed in an index rate mode subsequent to December 31, 2017. Also includes $40 million in pollution control revenue bonds classified as short term since they are variable rate demand obligations supported by short-term credit facilities; however, the final maturity dates range from 2020 to 2028.

Maturities through 2022 applicable to total long-term debt are as follows: $3.9 billion in 2018; $3.2 billion in 2019; $3.2 billion in 2020; $3.1 billion in 2021; and $2.2 billion in 2022.

Bank Term Loans

Southern Company and certain of its subsidiaries have entered into various bank term loan agreements. Unless otherwise stated, the proceeds of these loans were used to repay existing indebtedness and for general corporate purposes, including working capital and, for the subsidiaries, their continuous construction programs.

At December 31, 2017, Southern Company, Alabama Power, Georgia Power, Mississippi Power, and Southern Power Company had outstanding bank term loans totaling $450 million, $45 million, $250 million, $900 million, and $420 million, respectively, of which $1.5 billion are reflected in the statements of capitalization as long-term debt and $600 million are reflected in the balance sheet as notes payable. At December 31, 2016, Southern Company, Alabama Power, Gulf Power, Mississippi Power, and Southern Power Company had outstanding bank term loans totaling $400 million, $45 million, $100 million, $1.2 billion, and $380 million, respectively, of which $2.0 billion were reflected in the statements of capitalization as long-term debt and $100 million were reflected in the balance sheet as notes payable.

In June 2017, Southern Company entered into two $100 million aggregate principal amount short-term floating rate bank term loan agreements, which mature on June 21, 2018 and June 29, 2018 and bear interest based on one-month LIBOR.

In August 2017, Southern Company borrowed $250 million pursuant to a short-term uncommitted bank credit arrangement, which bears interest at a rate agreed upon by Southern Company and the bank from time to time and is payable on no less than 30 days' demand by the bank.

In June 2017, Georgia Power entered into two short-term floating rate bank loans in aggregate principal amounts of $50 million and $150 million, with maturity dates of December 1, 2017 and May 31, 2018, respectively, and one long-term floating rate bank loan of $100 million, with a maturity date of June 28, 2018, which was amended in August 2017 to extend the maturity date to October 26, 2018. These loans bear interest based on one-month LIBOR. Also in June 2017, Georgia Power borrowed $500 million pursuant to a short-term uncommitted bank credit arrangement, which bears interest at a rate agreed upon by Georgia Power and the bank from time to time and is payable on no less than 30 days' demand by the bank.

In August 2017, Georgia Power repaid its $50 million floating rate bank loan due December 1, 2017 and $250 million of the $500 million aggregate principal amount outstanding pursuant to its uncommitted bank credit arrangement. In December 2017, Georgia Power repaid the remaining $250 million aggregate principal amount outstanding pursuant to its uncommitted bank credit arrangement.

In March 2017, Gulf Power extended the maturity of its $100 million short-term floating rate bank loan bearing interest based on one-month LIBOR from April 2017 to October 2017 and subsequently repaid the loan in May 2017.

In June 2017, Mississippi Power prepaid $300 million of the outstanding principal amount under its $1.2 billion unsecured term loan, which matures on March 30, 2018.

In September 2017, Southern Power amended its $60 million aggregate principal amount floating rate term loan to, among other things, increase the aggregate principal amount to $100 million and extend the maturity date from September 2017 to October 2018.

The outstanding bank loans as of December 31, 2017 have covenants that limit debt levels to a percentage of total capitalization. The percentage is 70% for Southern Company and 65% for Alabama Power, Georgia Power, Mississippi Power, and Southern Power Company, as defined in the agreements. For purposes of these definitions, debt excludes any long-term debt payable to affiliated trusts and other hybrid securities. Additionally, for Southern Company and Southern Power Company, for purposes of these definitions, debt excludes any project debt incurred by certain subsidiaries of Southern Power Company to the extent such debt is non-recourse to Southern Power Company and capitalization excludes the capital stock or other equity attributable to such subsidiary. At December 31, 2017, each of Southern Company, Alabama Power, Georgia Power, Gulf Power, Mississippi Power, and Southern Power Company was in compliance with its debt limits.

DOE Loan Guarantee Borrowings

Pursuant to the loan guarantee program established under Title XVII of the Energy Policy Act of 2005 (Title XVII Loan Guarantee Program), Georgia Power and the DOE entered into the Loan Guarantee Agreement in 2014, under which the DOE agreed to guarantee the obligations of Georgia Power under a note purchase agreement (FFB Note Purchase Agreement) among the DOE, Georgia Power, and the FFB and a related promissory note (FFB Promissory Note). The FFB Note Purchase Agreement and the FFB Promissory Note provide for a multi-advance term loan facility (FFB Credit Facility), under which Georgia Power may make term loan borrowings through the FFB.

On July 27, 2017, Georgia Power entered into an amendment to the Loan Guarantee Agreement (LGA Amendment) in connection with the DOE's consent to Georgia Power's entry into the Vogtle Services Agreement and the related intellectual property licenses (IP Licenses).

Under the terms of the Loan Guarantee Agreement, upon termination of the Vogtle 3 and 4 Agreement, further advances are conditioned upon the DOE's approval of any agreements entered into in replacement of the Vogtle 3 and 4 Agreement. Under the terms of the LGA Amendment, Georgia Power will not request any advances unless and until certain conditions are satisfied, including (i) receipt of the DOE's approval of the Bechtel Agreement (together with the Vogtle Services Agreement and the IP Licenses, the Replacement EPC Arrangements) and (ii) Georgia Power's entry into a further amendment to the Loan Guarantee Agreement with the DOE to reflect the Replacement EPC Arrangements.

Proceeds of advances made under the FFB Credit Facility are used to reimburse Georgia Power for Eligible Project Costs. Aggregate borrowings under the FFB Credit Facility may not exceed the lesser of (i) 70% of Eligible Project Costs or (ii) approximately $3.46 billion.

On September 28, 2017, the DOE issued a conditional commitment to Georgia Power for up to approximately $1.67 billion of additional guaranteed loans under the Loan Guarantee Agreement. This conditional commitment expires on June 30, 2018, subject to any further extension approved by the DOE. Final approval and issuance of these additional loan guarantees by the DOE cannot be assured and are subject to the negotiation of definitive agreements, completion of due diligence by the DOE, receipt of any necessary regulatory approvals, and satisfaction of other conditions.

All borrowings under the FFB Credit Facility are full recourse to Georgia Power, and Georgia Power is obligated to reimburse the DOE for any payments the DOE is required to make to the FFB under the guarantee. Georgia Power's reimbursement obligations to the DOE are full recourse and secured by a first priority lien on (i) Georgia Power's 45.7% undivided ownership interest in Plant Vogtle Units 3 and 4 (primarily the units under construction, the related real property, and any nuclear fuel loaded in the reactor core) and (ii) Georgia Power's rights and obligations under the principal contracts relating to Plant Vogtle Units 3 and 4. There are no restrictions on Georgia Power's ability to grant liens on other property.

In addition to the conditions described above, future advances are subject to satisfaction of customary conditions, as well as certification of compliance with the requirements of the Title XVII Loan Guarantee Program, including accuracy of project-related representations and warranties, delivery of updated project-related information, and evidence of compliance with the prevailing wage requirements of the Davis-Bacon Act of 1931, as amended, and certification from the DOE's consulting engineer that proceeds of the advances are used to reimburse Eligible Project Costs.

Upon satisfaction of all conditions described above, advances may be requested under the FFB Credit Facility on a quarterly basis through 2020. The final maturity date for each advance under the FFB Credit Facility is February 20, 2044. Interest is payable quarterly and principal payments will begin on February 20, 2020. Borrowings under the FFB Credit Facility will bear interest at the applicable U.S. Treasury rate plus a spread equal to 0.375%.

At both December 31, 2017 and 2016, Georgia Power had $2.6 billion of borrowings outstanding under the FFB Credit Facility.

Under the Loan Guarantee Agreement, Georgia Power is subject to customary borrower affirmative and negative covenants and events of default. In addition, Georgia Power is subject to project-related reporting requirements and other project-specific covenants and events of default.

In the event certain mandatory prepayment events occur, the FFB's commitment to make further advances under the FFB Credit Facility will terminate and Georgia Power will be required to prepay the outstanding principal amount of all borrowings under the FFB Credit Facility over a period of five years (with level principal amortization). Among other things, these mandatory prepayment events include (i) the termination of the Vogtle Services Agreement or rejection of the Vogtle Services Agreement in bankruptcy if Georgia Power does not maintain access to intellectual property rights under the IP Licenses; (ii) a decision by Georgia Power not to continue construction of Plant Vogtle Units 3 and 4; (iii) cancellation of Plant Vogtle Units 3 and 4 by the Georgia PSC, or by Georgia Power if authorized by the Georgia PSC; and (iv) cost disallowances by the Georgia PSC that could have a material adverse effect on completion of Plant Vogtle Units 3 and 4 or Georgia Power's ability to repay the outstanding borrowings under the FFB Credit Facility. Under certain circumstances, insurance proceeds and any proceeds from an event of taking must be applied to immediately prepay outstanding borrowings under the FFB Credit Facility. In addition, if Georgia Power discontinues construction of Plant Vogtle Units 3 and 4, Georgia Power would be obligated to immediately repay a portion of the outstanding borrowings under the FFB Credit Facility to the extent such outstanding borrowings exceed 70% of Eligible Project Costs, net of the proceeds received by Georgia Power under the Guarantee Settlement Agreement. Georgia Power also may voluntarily prepay outstanding borrowings under the FFB Credit Facility. Under the FFB Credit Facility, any prepayment (whether mandatory or optional) will be made with a make-whole premium or discount, as applicable.

In connection with any cancellation of Plant Vogtle Units 3 and 4 that results in a mandatory prepayment event, the DOE may elect to continue construction of Plant Vogtle Units 3 and 4. In such an event, the DOE will have the right to assume Georgia Power's rights and obligations under the principal agreements relating to Plant Vogtle Units 3 and 4 and to acquire all or a portion of Georgia Power's ownership interest in Plant Vogtle Units 3 and 4.

Senior Notes

Southern Company and its subsidiaries issued a total of $4.0 billion of senior notes in 2017. Southern Company issued $0.3 billion and its subsidiaries issued a total of $3.7 billion. The proceeds of Southern Company's issuances were used to repay short-term indebtedness and for other general corporate purposes. Except as described below, the proceeds of Southern Company's subsidiaries' issuances were used to repay long-term indebtedness, to repay short-term indebtedness, and for other general corporate purposes, including the applicable subsidiaries' continuous construction programs. A portion of the proceeds of Gulf Power's senior note issuances was used to redeem all of Gulf Power's outstanding shares of preference stock. See "Redeemable Preferred Stock of Subsidiaries" herein for additional information.

At December 31, 2017 and 2016, Southern Company and its subsidiaries had a total of $35.1 billion and $33.0 billion, respectively, of senior notes outstanding. At December 31, 2017 and 2016, Southern Company had a total of $10.2 billion and $10.3 billion, respectively, of senior notes outstanding. These amounts include senior notes due within one year.

Since Southern Company is a holding company, the right of Southern Company and, hence, the right of creditors of Southern Company (including holders of Southern Company senior notes) to participate in any distribution of the assets of any subsidiary of Southern Company, whether upon liquidation, reorganization or otherwise, is subject to prior claims of creditors and preferred stockholders of such subsidiary.

Junior Subordinated Notes

At December 31, 2017 and 2016, Southern Company and its subsidiaries had a total of $3.6 billion and $2.4 billion, respectively, of junior subordinated notes outstanding.

In June 2017, Southern Company issued $500 million aggregate principal amount of Series 2017A 5.325% Junior Subordinated Notes due June 21, 2057. The proceeds were used to repay short-term indebtedness and for other general corporate purposes.

In November 2017, Southern Company issued $450 million aggregate principal amount of Series 2017B 5.25% Junior Subordinated Notes due December 1, 2077. The proceeds were used to repay short-term indebtedness and for other general corporate purposes.

In September 2017, Georgia Power issued $270 million aggregate principal amount of Series 2017A 5.00% Junior Subordinated Notes due October 1, 2077. The proceeds were used to redeem all outstanding shares of Georgia Power's preferred and preference stock. See "Redeemable Preferred Stock of Subsidiaries" herein for additional information.

Pollution Control Revenue Bonds

Pollution control revenue bond obligations represent loans to the traditional electric operating companies from public authorities of funds derived from sales by such authorities of revenue bonds issued to finance pollution control and solid waste disposal facilities. In some cases, the pollution control revenue bond obligations represent obligations under installment sales agreements with respect to facilities constructed with the proceeds of revenue bonds issued by public authorities. The traditional electric operating companies had $3.3 billion of outstanding pollution control revenue bond obligations at December 31, 2017 and 2016, which includes pollution control revenue bonds classified as due within one year. The traditional electric operating companies are required to make payments sufficient for the authorities to meet principal and interest requirements of such bonds. Proceeds from certain issuances are restricted until qualifying expenditures are incurred.

Plant Daniel Revenue Bonds

In 2011, in connection with Mississippi Power's election under its operating lease of Plant Daniel Units 3 and 4 to purchase the assets, Mississippi Power assumed the obligations of the lessor related to $270 million aggregate principal amount of Mississippi Business Finance Corporation Taxable Revenue Bonds, 7.13% Series 1999A due October 20, 2021, issued for the benefit of the lessor. See "Assets Subject to Lien" herein for additional information.

Gas Facility Revenue Bonds

Pivotal Utility Holdings, Inc., a subsidiary of Southern Company Gas (Pivotal Utility Holdings), is party to a series of loan agreements with the New Jersey Economic Development Authority and Brevard County, Florida under which five series of gas facility revenue bonds have been issued with maturities ranging from 2022 to 2033. These revenue bonds are issued by state agencies or counties to investors, and proceeds from each issuance then are loaned to Southern Company Gas. The amount of gas facility revenue bonds outstanding at December 31, 2017 and 2016 was $200 million.

The Elizabethtown Gas asset sale agreement requires that bonds representing $180 million of the total that are currently eligible for redemption at par be redeemed on or prior to consummation of the sale. The ultimate outcome of this matter cannot be determined at this time. See Note 12 under "Southern Company Gas – Proposed Sale of Elizabethtown Gas and Elkton Gas" for additional information.

Other Revenue Bonds

Other revenue bond obligations represent loans to Mississippi Power from a public authority of funds derived from the sale by such authority of revenue bonds issued to finance a portion of the costs of constructing the Kemper County energy facility and related facilities.

Mississippi Power had $50 million of such obligations outstanding related to tax-exempt revenue bonds at December 31, 2017 and 2016. Such amounts are reflected in the statements of capitalization as other long-term debt.

First Mortgage Bonds

Nicor Gas, a subsidiary of Southern Company Gas, had $1.0 billion and $625 million of first mortgage bonds outstanding at December 31, 2017 and 2016, respectively. These bonds have been issued with maturities ranging from 2019 to 2057. Substantially all of Nicor Gas' properties are subject to the lien of the indenture securing these first mortgage bonds. See "Assets Subject to Lien" herein for additional information.

On August 10, 2017, Nicor Gas issued $100 million aggregate principal amount of First Mortgage Bonds 3.03% Series due August 10, 2027 and $100 million aggregate principal amount of First Mortgage Bonds 3.62% Series due August 10, 2037. On November 1, 2017, Nicor Gas issued $100 million aggregate principal amount of First Mortgage Bonds 3.85% Series due August 10, 2047 and $100 million aggregate principal amount of First Mortgage Bonds 4.00% Series due August 10, 2057. The proceeds were used to repay short-term indebtedness incurred under the Nicor Gas commercial paper program and for other working capital needs.

Long-Term Debt Payable to an Affiliated Trust

Alabama Power has formed a wholly-owned trust subsidiary for the purpose of issuing preferred securities. The proceeds of the related equity investments and preferred security sales were loaned back to Alabama Power through the issuance of junior subordinated notes totaling $206 million outstanding as of December 31, 2017 and 2016, which constitute substantially all of the assets of this trust and are reflected in the balance sheets as long-term debt payable. Alabama Power considers that the mechanisms and obligations relating to the preferred securities issued for its benefit, taken together, constitute a full and unconditional guarantee by it of the trust's payment obligations with respect to these securities. At December 31, 2017 and 2016, trust preferred securities of $200 million were outstanding.

Capital Leases

Assets acquired under capital leases are recorded in the balance sheets as property, plant, and equipment and the related obligations are classified as long-term debt.

In 2013, Mississippi Power entered into a nitrogen supply agreement for the air separation unit of the Kemper County energy facility, which resulted in a capital lease obligation of $74 million at December 31, 2016. Following the suspension of the Kemper IGCC, Mississippi Power entered into an asset purchase and settlement agreement in December 2017 with the lessor, which terminated the capital lease obligation. See Note 3 under "Kemper County Energy Facility" for additional information.

At December 31, 2017 and 2016, the capitalized lease obligations for Georgia Power's corporate headquarters building were $22 million and $28 million, respectively, with an annual interest rate of 7.9%.

At December 31, 2017 and 2016, a subsidiary of Southern Company had capital lease obligations of approximately $177 million and $29 million, respectively, for an office building and certain computer equipment including desktops, laptops, servers, printers, and storage devices with annual interest rates that range from 1.5% to 4.7%.

Assets Subject to Lien

Each of Southern Company's subsidiaries is organized as a legal entity, separate and apart from Southern Company and its other subsidiaries. There are no agreements or other arrangements among the Southern Company system companies under which the assets of one company have been pledged or otherwise made available to satisfy obligations of Southern Company or any of its other subsidiaries.

Gulf Power has granted one or more liens on certain of its property in connection with the issuance of certain series of pollution control revenue bonds with an aggregate outstanding principal amount of $41 million as of December 31, 2017.

The revenue bonds assumed in conjunction with Mississippi Power's purchase of Plant Daniel Units 3 and 4 are secured by Plant Daniel Units 3 and 4 and certain related personal property. See "Plant Daniel Revenue Bonds" herein for additional information.

On October 4, 2017, Mississippi Power executed agreements with its largest retail customer, Chevron Products Company (Chevron), to continue providing retail service to the Chevron refinery in Pascagoula, Mississippi through 2038, subject to the approval of the Mississippi PSC. The agreements grant Chevron a security interest in the co-generation assets, with a net book value of approximately $93 million, located at Chevron's refinery that is exercisable upon the occurrence of (i) certain bankruptcy events or (ii) other events of default coupled with specific reductions in steam output at the facility and a downgrade of Mississippi Power's credit rating to below investment grade by two of the three rating agencies.

See "DOE Loan Guarantee Borrowings" above for information regarding certain borrowings of Georgia Power that are secured by a first priority lien on (i) Georgia Power's 45.7% undivided ownership interest in Plant Vogtle Units 3 and 4 (primarily the units under construction, the related real property, and any nuclear fuel loaded in the reactor core) and (ii) Georgia Power's rights and obligations under the principal contracts relating to Plant Vogtle Units 3 and 4.

The first mortgage bonds issued by Nicor Gas are secured by substantially all of Nicor Gas' properties. See "First Mortgage Bonds" herein for additional information.

Under the terms of the PPA and the expansion PPA for Southern Power's Mankato project, which was acquired in 2016, approximately $442 million of assets, primarily related to property, plant, and equipment, are subject to lien at December 31, 2017. See Note 12 under "Southern Power" for additional information.

During 2015, Southern Power indirectly acquired a 51% membership interest in RE Roserock LLC (Roserock), the owner of the Roserock solar facility in Pecos County, Texas. Roserock is in a litigation dispute with McCarthy Building Companies, Inc. (McCarthy) regarding damage to certain solar panels during installation. In connection therewith, Roserock is withholding payments of approximately $26 million from McCarthy, and McCarthy has filed mechanic's liens on the Roserock facility for the same amount. Southern Power intends to vigorously pursue its claims against McCarthy and defend against McCarthy's claims, the ultimate outcome of which cannot be determined at this time.

Bank Credit Arrangements

At December 31, 2017, committed credit arrangements with banks were as follows:



	Expires												Executable Term Loans				Expires Within One Year
Company	2018		2019		2020		2022		Total		Unused		One Year		Two Years		Term Out		No Term Out
	(in millions)
Southern Company^(a)	$	—	$	—	$	—	$	2,000	$	2,000	$	1,999	$	—	$	—	$	—	$	—
Alabama Power	35		—		500		800		1,335		1,335		—		—		—		35
Georgia Power	—		—		—		1,750		1,750		1,732		—		—		—		—
Gulf Power	30		25		225		—		280		280		45		—		20		10
Mississippi Power	100		—		—		—		100		100		—		—		—		100
Southern Power Company^(b)	—		—		—		750		750		728		—		—		—		—
Southern Company Gas^(c)	—		—		—		1,900		1,900		1,890		—		—		—		—
Other	30		—		—		—		30		30		20		—		20		10
Southern Company Consolidated	$	195	$	25	$	725	$	7,200	$	8,145	$	8,094	$	65	$	—	$	40	$	155


(a)	Represents the Southern Company parent entity.


(b)	Does not include Southern Power's $120 million continuing letter of credit facility for standby letters of credit expiring in 2019, of which $19 million remains unused at December 31, 2017.


(c)	Southern Company Gas, as the parent entity, guarantees the obligations of Southern Company Gas Capital, which is the borrower of $1.4 billion of these arrangements. Southern Company Gas' committed credit arrangements also include $500 million for which Nicor Gas is the borrower and which is restricted for working capital needs of Nicor Gas.

In May 2017, Southern Company, Alabama Power, Georgia Power, and Southern Power Company each amended certain of their multi-year credit arrangements, which, among other things, extended the maturity dates from 2020 to 2022. Southern Company and Southern Power Company increased their borrowing ability under these arrangements to $2.0 billion from $1.25 billion and to $750 million from $600 million, respectively. Southern Company also terminated its $1.0 billion facility maturing in 2018. Also in May 2017, Southern Company Gas Capital and Nicor Gas terminated their existing credit arrangements for $1.3 billion and $700 million, respectively, which were to mature in 2017 and 2018, and entered into a new multi-year credit arrangement with $1.4 billion and $500 million currently allocated to Southern Company Gas Capital and Nicor Gas, respectively, maturing in 2022. Pursuant to the new multi-year credit arrangement, the allocations between Southern Company Gas Capital and Nicor Gas may be adjusted. In September 2017, Alabama Power also amended its $500 million multi-year credit arrangement, which, among other things, extended the maturity date from 2018 to 2020. In November 2017, Gulf Power amended $195 million of its multi-year credit arrangements to extend the maturity dates from 2017 and 2018 to 2020 and Mississippi Power amended its one-year credit arrangements in an aggregate amount of $100 million to extend the maturity dates from 2017 to 2018.

Most of the bank credit arrangements require payment of commitment fees based on the unused portion of the commitments or the maintenance of compensating balances with the banks. Commitment fees average less than ¹/4 of 1% for Southern Company, the traditional electric operating companies, Southern Power Company, Southern Company Gas, and Nicor Gas. Compensating balances are not legally restricted from withdrawal.

Subject to applicable market conditions, Southern Company and its subsidiaries expect to renew or replace their bank credit arrangements as needed, prior to expiration. In connection therewith, Southern Company and its subsidiaries may extend the maturity dates and/or increase or decrease the lending commitments thereunder.

Southern Company's, Southern Company Gas', and Nicor Gas' credit arrangements contain covenants that limit debt levels to 70% of total capitalization, as defined in the agreements, and most of the other subsidiaries' bank credit arrangements contain covenants that limit debt levels to 65% of total capitalization, as defined in the agreements. For purposes of these definitions, debt excludes the long-term debt payable to affiliated trusts and, in certain arrangements and other hybrid securities. Additionally, for Southern Company and Southern Power Company, for purposes of these definitions, debt excludes any project debt incurred by certain subsidiaries of Southern Power Company to the extent such debt is non-recourse to Southern Power Company and capitalization excludes the capital stock or other equity attributable to such subsidiaries. At December 31, 2017, Southern Company, the traditional electric operating companies, Southern Power Company, Southern Company Gas, and Nicor Gas were each in compliance with their respective debt limit covenants.

A portion of the $8.1 billion unused credit with banks is allocated to provide liquidity support to the revenue bonds of the traditional electric operating companies and the commercial paper programs of Southern Company, the traditional electric operating companies, Southern Power Company, Southern Company Gas, and Nicor Gas. The amount of variable rate revenue bonds of the traditional electric operating companies outstanding requiring liquidity support as of December 31, 2017 was approximately $1.5 billion as compared to $1.9 billion at December 31, 2016. In addition, at December 31, 2017, the traditional electric operating companies had approximately $714 million of revenue bonds outstanding that were required to be remarketed within the next 12 months. Subsequent to December 31, 2017, $50 million of these revenue bonds of Mississippi Power which were in a long-term interest rate mode were remarketed in an index rate mode.

Southern Company, the traditional electric operating companies (other than Mississippi Power), Southern Power Company, Southern Company Gas, and Nicor Gas make short-term borrowings primarily through commercial paper programs that have the liquidity support of the committed bank credit arrangements described above. Commercial paper and short-term bank term loans are included in notes payable in the balance sheets.

Details of short-term borrowings were as follows:



	Short-term Debt at the End of the Period
	Amount Outstanding		Weighted Average Interest Rate
	(in millions)
December 31, 2017:
Commercial paper	$	1,832	1.8	%
Short-term bank debt	607		2.3	%
Total	$	2,439	1.9	%
December 31, 2016:
Commercial paper	$	1,909	1.1	%
Short-term bank debt	123		1.7	%
Total	$	2,032	1.1	%

In addition to the short-term borrowings of Southern Power Company included in the table above, at December 31, 2016, Southern Power Company subsidiaries had 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. The Project Credit Facilities were fully repaid in January 2017 and had total amounts outstanding of $209 million at a weighted average interest rate of 2.1% at December 31, 2016.

Redeemable Preferred Stock of Subsidiaries

At December 31, 2016, each of the traditional electric operating companies had outstanding preferred and/or preference stock. During 2017, Alabama Power and Gulf Power each redeemed all of its outstanding preference stock and Georgia Power redeemed all of its outstanding preferred and preference stock. The preferred stock of Alabama Power and Mississippi Power contains a feature that allows the holders to elect a majority of such subsidiary's board of directors if preferred dividends are not paid for four consecutive quarters. Because such a potential redemption-triggering event is not solely within the control of Alabama Power and Mississippi Power, this preferred stock is presented as "Redeemable Preferred Stock of Subsidiaries" in a manner consistent with temporary equity under applicable accounting standards. The preferred and preference stock at Georgia Power and the preference stock at Alabama Power and Gulf Power did not contain such a provision. As a result, under applicable accounting standards, the preferred and preference stock at Georgia Power and the preference stock at Alabama Power and Gulf Power are presented as "Preferred and Preference Stock of Subsidiaries," a separate component of "Stockholders' Equity," on Southern Company's balance sheets, statements of capitalization, and statements of stockholders' equity.

The following table presents changes during the year in redeemable preferred stock of subsidiaries for Southern Company:



	Redeemable Preferred Stock of Subsidiaries
	(in millions)
Balance at December 31, 2014	$	375
Issued	—
Redeemed	(262		)
Issuance costs	5
Balance at December 31, 2015:	118
Issued	—
Redeemed	—
Balance at December 31, 2016:	118
Issued	250
Redeemed	(38		)
Issuance costs	(6		)
Balance at December 31, 2017:	$	324

ALABAMA POWER CO

Debt Disclosure [Line Items]

FINANCING

Long-Term Debt Payable to an Affiliated Trust

The Company has formed a wholly-owned trust subsidiary for the purpose of issuing preferred securities. The proceeds of the related equity investments and preferred security sales were loaned back to the Company through the issuance of junior subordinated notes totaling $206 million outstanding as of December 31, 2017 and 2016, which constitute substantially all of the assets of this trust and are reflected in the balance sheets as long-term debt payable. The Company considers that the mechanisms and obligations relating to the preferred securities issued for its benefit, taken together, constitute a full and unconditional guarantee by it of the trust's payment obligations with respect to these securities. At December 31, 2017 and 2016, trust preferred securities of $200 million were outstanding. See Note 1 under "Variable Interest Entities" for additional information on the accounting treatment for this trust and the related securities.

Securities Due Within One Year

At December 31, 2017, the Company had no securities due within one year. At December 31, 2016, the Company had $561 million of senior notes and pollution control revenue bonds due within one year.

Maturities through 2022 applicable to total long-term debt are as follows: $200 million in 2019; $250 million in 2020; $310 million in 2021; and $750 million in 2022. There are no scheduled maturities in 2018.

Bank Term Loans

At both December 31, 2017 and 2016, the Company had $45 million of outstanding bank term loan agreements, which are reflected in the statements of capitalization as long-term debt.

These bank loans have covenants that limit debt levels to 65% of total capitalization, as defined in the agreements. For purposes of calculating these covenants, any long-term notes payable to affiliated trusts are excluded from debt but included in capitalization. At December 31, 2017, the Company was in compliance with its debt limits.

Pollution Control Revenue Bonds

Pollution control revenue bond obligations represent loans to the Company from public authorities of funds or installment purchases of pollution control and solid waste disposal facilities financed by funds derived from sales by public authorities of revenue bonds. The Company is required to make payments sufficient for the authorities to meet principal and interest requirements of such bonds. The Company incurred no obligations related to the issuance of pollution control revenue bonds in 2017.

In August 2017, the Company repaid at maturity $36.1 million aggregate principal amount of Series 1993-A, 1993-B, and 1993-C Industrial Development Board of the City of Mobile, Alabama Pollution Control Revenue Refunding Bonds (Alabama Power Company Project).

The Company had $1.06 billion and $1.10 billion of tax-exempt pollution control revenue bond obligations outstanding at December 31, 2017 and 2016, respectively, including pollution control revenue bonds classified as due within one year.

Senior Notes

In March 2017, the Company issued $550 million aggregate principal amount of Series 2017A 2.45% Senior Notes due March 30, 2022. The proceeds were used to repay the Company's short-term indebtedness and for general corporate purposes, including the Company's continuous construction program.

In November 2017, the Company issued $550 million aggregate principal amount of Series 2017B 3.70% Senior Notes due December 1, 2047. The proceeds were used for general corporate purposes, including the Company's continuous construction program.

At December 31, 2017 and 2016, the Company had $6.4 billion and $5.8 billion of senior notes outstanding, respectively, including senior notes classified as due within one year. At December 31, 2017 and 2016, the Company did not have any outstanding secured debt.

Redeemable Preferred and Preference Stock

The Company currently has preferred stock, Class A preferred stock, and common stock outstanding. The Company also has authorized preference stock, none of which is outstanding. The Company's preferred stock and Class A preferred stock, without preference between classes, rank senior to the Company's common stock with respect to payment of dividends and voluntary and involuntary dissolution. The preferred stock and Class A preferred stock of the Company contain a feature that allows the holders to elect a majority of the Company's board of directors if preferred dividends are not paid for four consecutive quarters. Because such a potential redemption-triggering event is not solely within the control of the Company, the preferred stock and Class A preferred stock is presented as "Redeemable Preferred Stock" in a manner consistent with temporary equity under applicable accounting standards.

The Company's preferred stock is subject to redemption at a price equal to the par value plus a premium. The Company's Class A preferred stock is subject to redemption at a price equal to the stated capital. All series of the Company's preferred stock currently are subject to redemption at the option of the Company. The Class A preferred stock is subject to redemption on or after October 1, 2022, or following the occurrence of a rating agency event. Information for each outstanding series is in the table below:



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
5.00% Class A Preferred Stock	$25	10,000,000	Stated Capital^(*)


(*)	Prior to October 1, 2022: $25.50; on or after October 1, 2022: Stated Capital

In September 2017, the Company issued 10 million shares ($250 million aggregate stated capital) of 5.00% Class A Preferred Stock, Cumulative, Par Value $1 Per Share (Stated Capital 25 Per Share). The proceeds were used in October 2017 to redeem all 2 million shares ($50 million aggregate stated capital) of 6.50% Series Preference Stock, 6 million shares ($150 million aggregate stated capital) of 6.45% Series Preference Stock, and 1.52 million shares ($38 million aggregate stated capital) of 5.83% Class A Preferred Stock and for other general corporate purposes, including the Company's continuous construction program.

There were no changes for the year ended December 31, 2016 in redeemable preferred stock or preference stock of the Company.

Dividend Restrictions

The Company can only pay dividends to Southern Company out of retained earnings or paid-in-capital.

Bank Credit Arrangements

At December 31, 2017, committed credit arrangements with banks were as follows:



Expires										Expires Within One Year
2018		2020		2022		Total		Unused		Term Out		No Term Out
(in millions)						(in millions)				(in millions)
$	35	$	500	$	800	$	1,335	$	1,335	$	—	$	35

Most of the bank credit arrangements require payment of a commitment fee based on the unused portion of the commitments or the maintenance of compensating balances with the banks. Commitment fees average less than ¹/4 of 1% for the Company. Compensating balances are not legally restricted from withdrawal.

Subject to applicable market conditions, the Company expects to renew or replace its bank credit agreements as needed, prior to expiration. In connection therewith, the Company may extend the maturity date and/or increase or decrease the lending commitments thereunder.

Most of the Company's bank credit arrangements contain covenants that limit the Company's debt level to 65% of total capitalization, as defined in the arrangements. For purposes of calculating these covenants, any long-term notes payable to affiliated trusts are excluded from debt but included in capitalization. At December 31, 2017, the Company was in compliance with the debt limit covenants.

A portion of the unused credit with banks is allocated to provide liquidity support to the Company's pollution control revenue bonds and commercial paper programs. The amount of variable rate pollution control revenue bonds outstanding requiring liquidity support was $854 million as of December 31, 2017. In addition, at December 31, 2017, the Company had $120 million of fixed rate pollution control revenue bonds outstanding that were required to be remarketed within the next 12 months.

The Company borrows through commercial paper programs that have the liquidity support of the committed bank credit arrangements described above. The Company may also make short-term borrowings through various other arrangements with banks. At December 31, 2017, the Company had $3 million in short-term debt outstanding and none at December 31, 2016. At December 31, 2017, the Company had regulatory approval to have outstanding up to $2.0 billion of short-term borrowings.

GEORGIA POWER CO

Debt Disclosure [Line Items]

FINANCING

Securities Due Within One Year

A summary of scheduled maturities of securities due within one year at December 31 was as follows:



	2017			2016
	(in millions)
Senior notes	$	750		$	450
Capital leases	11			10
Other long-term debt	100			—
Unamortized debt issuance expense	(1		)	—
Total	$	860		$	460

Maturities through 2022 applicable to total long-term debt are as follows: $861 million in 2018; $513 million in 2019; $1.0 billion in 2020; $375 million in 2021; and $518 million in 2022.

Bank Term Loans

In June 2017, the Company entered into three floating rate bank loans in aggregate principal amounts of $50 million, $150 million, and $100 million, with maturity dates of December 1, 2017, May 31, 2018, and June 28, 2018, respectively, bearing interest based on one-month LIBOR. Also in June 2017, the Company borrowed $500 million pursuant to an uncommitted bank credit arrangement, which bears interest at a rate agreed upon by the Company and the bank from time to time and is payable on no less than 30 days' demand by the bank. The proceeds from these bank loans were used to repay a portion of the Company's existing indebtedness and for working capital and other general corporate purposes, including the Company's continuous construction program.

In August 2017, the Company repaid $250 million of the $500 million aggregate principal amount outstanding pursuant to its uncommitted bank credit arrangement. Also in August 2017, the Company amended its $100 million floating rate bank loan to extend the maturity date from June 28, 2018 to October 26, 2018. In December 2017, the Company repaid the remaining $250 million aggregate principal amount outstanding pursuant to its uncommitted bank credit arrangement.

At December 31, 2017, the Company had a total of $250 million in bank term loans outstanding. Subsequent to December 31, 2017, the Company repaid its outstanding $150 million and $100 million floating rate bank loans due May 31, 2018 and October 26, 2018, respectively. At December 31, 2016, the Company had no bank term loans outstanding.

The outstanding bank loans as of December 31, 2017 had covenants that limited debt levels to 65% of total capitalization, as defined in the agreements. For purposes of these definitions, debt excludes certain hybrid securities. At December 31, 2017, the Company was in compliance with its debt limits.

Senior Notes

In March 2017, the Company issued $450 million aggregate principal amount of Series 2017A 2.00% Senior Notes due March 30, 2020 and $400 million aggregate principal amount of Series 2017B 3.25% Senior Notes due March 30, 2027. The proceeds were used to repay a portion of the Company's short-term indebtedness and for general corporate purposes, including the Company's continuous construction program.

In August 2017, the Company issued $500 million aggregate principal amount of Series 2017C 2.00% Senior Notes due September 8, 2020. The proceeds were used to repay the Company's $50 million floating rate bank loan due December 1, 2017 and outstanding commercial paper borrowings and for general corporate purposes.

At December 31, 2017 and 2016, the Company had $7.1 billion and $6.2 billion of senior notes outstanding, respectively, which included senior notes due within one year. These senior notes are effectively subordinated to all secured debt of the Company, which aggregated $2.8 billion at both December 31, 2017 and 2016. As of December 31, 2017, the Company's secured debt included borrowings of $2.6 billion guaranteed by the DOE and capital lease obligations of $154 million. As of December 31, 2016, the Company's secured debt included borrowings of $2.6 billion guaranteed by the DOE and capital lease obligations of $169 million. See Note 7 and "DOE Loan Guarantee Borrowings" herein for additional information.

Pollution Control Revenue Bonds

Pollution control revenue bond obligations represent loans to the Company from public authorities of funds derived from sales by such authorities of revenue bonds issued to finance pollution control and solid waste disposal facilities. The Company is required to make payments sufficient for the authorities to meet principal and interest requirements of such bonds. The amount of tax-exempt pollution control revenue bond obligations outstanding at both December 31, 2017 and 2016 was $1.8 billion.

In April 2017, the Company purchased and held $27 million aggregate principal amount of Development Authority of Burke County (Georgia) Pollution Control Revenue Bonds (Georgia Power Company Plant Vogtle Project), Fifth Series 1995. In October 2017, the Company remarketed these bonds to the public.

In August 2017, the Company purchased and held $38 million aggregate principal amount of Development Authority of Bartow County (Georgia) Pollution Control Revenue Bonds (Georgia Power Company Plant Bowen Project), First Series 1997. In October 2017, the Company remarketed these bonds to the public.

Junior Subordinated Notes

At December 31, 2017, the Company had a total of $270 million of junior subordinated notes outstanding. At December 31, 2016, the Company had no junior subordinated notes outstanding.

In September 2017, the Company issued $270 million aggregate principal amount of Series 2017A 5.00% Junior Subordinated Notes due October 1, 2077. The proceeds were used to redeem all outstanding shares of the Company's preferred and preference stock. See "Outstanding Classes of Capital Stock" herein for additional information.

DOE Loan Guarantee Borrowings

Pursuant to the loan guarantee program established under Title XVII of the Energy Policy Act of 2005 (Title XVII Loan Guarantee Program), the Company and the DOE entered into the Loan Guarantee Agreement in 2014, under which the DOE agreed to guarantee the obligations of the Company under a note purchase agreement (FFB Note Purchase Agreement) among the DOE, the Company, and the FFB and a related promissory note (FFB Promissory Note). The FFB Note Purchase Agreement and the FFB Promissory Note provide for a multi-advance term loan facility (FFB Credit Facility), under which the Company may make term loan borrowings through the FFB.

On July 27, 2017, the Company entered into an amendment to the Loan Guarantee Agreement (LGA Amendment) in connection with the DOE's consent to the Company's entry into the Vogtle Services Agreement and the related intellectual property licenses (IP Licenses).

Under the terms of the Loan Guarantee Agreement, upon termination of the Vogtle 3 and 4 Agreement, further advances are conditioned upon the DOE's approval of any agreements entered into in replacement of the Vogtle 3 and 4 Agreement. Under the terms of the LGA Amendment, the Company will not request any advances unless and until certain conditions are satisfied, including (i) receipt of the DOE's approval of the Bechtel Agreement (together with the Vogtle Services Agreement and the IP Licenses, the Replacement EPC Arrangements) and (ii) the Company's entry into a further amendment to the Loan Guarantee Agreement with the DOE to reflect the Replacement EPC Arrangements.

Proceeds of advances made under the FFB Credit Facility are used to reimburse the Company for Eligible Project Costs. Aggregate borrowings under the FFB Credit Facility may not exceed the lesser of (i) 70% of Eligible Project Costs or (ii) approximately $3.46 billion.

On September 28, 2017, the DOE issued a conditional commitment to the Company for up to approximately $1.67 billion of additional guaranteed loans under the Loan Guarantee Agreement. This conditional commitment expires on June 30, 2018, subject to any further extension approved by the DOE. Final approval and issuance of these additional loan guarantees by the DOE cannot be assured and are subject to the negotiation of definitive agreements, completion of due diligence by the DOE, receipt of any necessary regulatory approvals, and satisfaction of other conditions.

All borrowings under the FFB Credit Facility are full recourse to the Company, and the Company is obligated to reimburse the DOE for any payments the DOE is required to make to the FFB under the guarantee. The Company's reimbursement obligations to the DOE are full recourse and secured by a first priority lien on (i) the Company's 45.7% undivided ownership interest in Plant Vogtle Units 3 and 4 (primarily the units under construction, the related real property, and any nuclear fuel loaded in the reactor core) and (ii) the Company's rights and obligations under the principal contracts relating to Plant Vogtle Units 3 and 4. There are no restrictions on the Company's ability to grant liens on other property.

At both December 31, 2017 and 2016, the Company had $2.6 billion of borrowings outstanding under the FFB Credit Facility.

Under the Loan Guarantee Agreement, the Company is subject to customary borrower affirmative and negative covenants and events of default. In addition, the Company is subject to project-related reporting requirements and other project-specific covenants and events of default.

In the event certain mandatory prepayment events occur, the FFB's commitment to make further advances under the FFB Credit Facility will terminate and the Company will be required to prepay the outstanding principal amount of all borrowings under the FFB Credit Facility over a period of five years (with level principal amortization). Among other things, these mandatory prepayment events include (i) the termination of the Vogtle Services Agreement or rejection of the Vogtle Services Agreement in bankruptcy if the Company does not maintain access to intellectual property rights under the IP Licenses; (ii) a decision by the Company not to continue construction of Plant Vogtle Units 3 and 4; (iii) cancellation of Plant Vogtle Units 3 and 4 by the Georgia PSC, or by the Company if authorized by the Georgia PSC; and (iv) cost disallowances by the Georgia PSC that could have a material adverse effect on completion of Plant Vogtle Units 3 and 4 or the Company's ability to repay the outstanding borrowings under the FFB Credit Facility. Under certain circumstances, insurance proceeds and any proceeds from an event of taking must be applied to immediately prepay outstanding borrowings under the FFB Credit Facility. In addition, if the Company discontinues construction of Plant Vogtle Units 3 and 4, the Company would be obligated to immediately repay a portion of the outstanding borrowings under the FFB Credit Facility to the extent such outstanding borrowings exceed 70% of Eligible Project Costs, net of the proceeds received by the Company under the Guarantee Settlement Agreement. The Company also may voluntarily prepay outstanding borrowings under the FFB Credit Facility. Under the FFB Credit Facility, any prepayment (whether mandatory or optional) will be made with a make-whole premium or discount, as applicable.

In connection with any cancellation of Plant Vogtle Units 3 and 4 that results in a mandatory prepayment event, the DOE may elect to continue construction of Plant Vogtle Units 3 and 4. In such an event, the DOE will have the right to assume the Company's rights and obligations under the principal agreements relating to Plant Vogtle Units 3 and 4 and to acquire all or a portion of the Company's ownership interest in Plant Vogtle Units 3 and 4.

Capital Leases

Assets acquired under capital leases are recorded in the balance sheets as utility plant in service, and the related obligations are classified as long-term debt. At December 31, 2017 and 2016, the Company had a capital lease asset for its corporate headquarters building of $61 million, with accumulated depreciation at December 31, 2017 and 2016 of $39 million and $33 million, respectively. At December 31, 2017 and 2016, the capitalized lease obligation was $22 million and $28 million, respectively, with an annual interest rate of 7.9%. For ratemaking purposes, the Georgia PSC has allowed the lease payments in cost of service with no return on the capital lease asset. The difference between the depreciation and the lease payments allowed for ratemaking purposes is recovered as operating expenses as ordered by the Georgia PSC. The annual operating expense incurred for this capital lease was not material for any year presented.

At December 31, 2017 and 2016, the Company had capital lease assets related to two PPAs with Southern Power of $144 million and $149 million, respectively, with accumulated amortization at December 31, 2017 and 2016 of $29 million and $19 million, respectively. At December 31, 2017 and 2016, the related capitalized lease obligations were $132 million and $141 million, respectively. The annual interest rates range from 10% to 12% for these two capital lease PPAs. For ratemaking purposes, the Georgia PSC has included the capital lease asset amortization in cost of service and the interest in the Company's cost of debt. See Note 1 under "Affiliate Transactions" and Note 7 under "Fuel and Purchased Power Agreements" for additional information.

Assets Subject to Lien

See "DOE Loan Guarantee Borrowings" above for information regarding certain borrowings of the Company that are secured by a first priority lien on (i) the Company's 45.7% undivided ownership interest in Plant Vogtle Units 3 and 4 (primarily the units under construction, the related real property, and any nuclear fuel loaded in the reactor core) and (ii) the Company's rights and obligations under the principal contracts relating to Plant Vogtle Units 3 and 4.

See "Capital Leases" above for information regarding certain assets held under capital leases.

Outstanding Classes of Capital Stock

The Company currently has preferred stock, Class A preferred stock, preference stock, and common stock authorized. The Company has shares of its common stock outstanding. In October 2017, the Company redeemed all 1.8 million shares ($45 million aggregate liquidation amount) of its 6.125% Series Class A Preferred Stock and 2.25 million shares ($225 million aggregate liquidation amount) of its 6.50% Series 2007A Preference Stock. No shares of preferred stock, Class A preferred stock, or preference stock were outstanding at December 31, 2017.

Dividend Restrictions

The Company can only pay dividends to Southern Company out of retained earnings or paid-in-capital.

Bank Credit Arrangements

At December 31, 2017, the Company had a $1.75 billion committed credit arrangement with banks, of which $1.73 billion was unused. In May 2017, the Company amended its multi-year credit arrangement which, among other things, extended the maturity date from 2020 to 2022.

This bank credit arrangement requires payment of commitment fees based on the unused portion of the commitments. Commitment fees average less than ¹/4 of 1% for the Company.

This bank credit arrangement contains a covenant that limits the Company's debt levels to 65% of total capitalization, as defined in the agreement. For purposes of this definition, debt excludes certain hybrid securities. At December 31, 2017, the Company was in compliance with the debt limit covenant.

Subject to applicable market conditions, the Company expects to renew this bank credit arrangement, as needed, prior to expiration. In connection therewith, the Company may extend the maturity date and/or increase or decrease the lending commitments thereunder.

A portion of the $1.73 billion unused credit with banks is allocated to provide liquidity support to the Company's pollution control revenue bonds and commercial paper program. The amount of variable rate pollution control revenue bonds outstanding requiring liquidity support as of December 31, 2017 was $550 million as compared to $868 million at December 31, 2016. In addition, at December 31, 2017, the Company had $469 million of pollution control revenue bonds outstanding that were required to be remarketed within the next 12 months.

The Company makes short-term borrowings primarily through a commercial paper program that has the liquidity support of the Company's committed bank credit arrangement described above. Commercial paper is included in notes payable in the balance sheets.

Details of short-term borrowings outstanding were as follows:



	Short-term Debt at the End of the Period
	Amount Outstanding		Weighted Average Interest Rate
	(in millions)
December 31, 2017:
Short-term bank debt	$	150	2.2	%
December 31, 2016:
Commercial paper	$	392	1.1	%

GULF POWER CO

Debt Disclosure [Line Items]

FINANCING

Securities Due Within One Year

At December 31, 2017, the Company had no long-term debt due within one year. At December 31, 2016, the Company had $87 million of long-term debt due within one year.

Maturities through 2022 applicable to total long-term debt include $175 million in 2020 and $141 million in 2022. There are no scheduled maturities in 2018, 2019, or 2021.

Bank Term Loans

At December 31, 2016, the Company had $100 million of bank term loans outstanding. In March 2017, the Company extended the maturity of its $100 million short-term floating rate bank loan bearing interest based on one-month LIBOR from April 2017 to October 2017 and subsequently repaid the loan in May 2017.

Senior Notes

At December 31, 2017 and 2016, the Company had a total of $990 million and $777 million of senior notes outstanding, respectively. These senior notes are effectively subordinate to all secured debt of the Company, which totaled approximately $41 million at both December 31, 2017 and 2016.

In May 2017, the Company issued $300 million aggregate principal amount of Series 2017A 3.30% Senior Notes due May 30, 2027. The proceeds, together with other funds, were used to repay at maturity $85 million aggregate principal amount of Series 2007A 5.90% Senior Notes due June 15, 2017, to repay outstanding commercial paper borrowings, to repay a $100 million short-term floating rate bank loan, and to redeem, in June 2017, all outstanding shares of preference stock. See "Bank Term Loans" and "Outstanding Classes of Capital Stock" herein for more information.

Pollution Control Revenue Bonds

Outstanding Classes of Capital Stock

The Company currently has preferred stock, Class A preferred stock, preference stock, and common stock authorized. The Company's preferred stock and Class A preferred stock, without preference between classes, would rank senior to the Company's preference stock and common stock with respect to payment of dividends and voluntary or involuntary dissolution. No shares of preferred stock or Class A preferred stock were outstanding at December 31, 2017. The Company's preference stock would rank senior to the common stock with respect to the payment of dividends and voluntary or involuntary dissolution. No shares of preference stock were outstanding at December 31, 2017. In June 2017, the Company redeemed 550,000 shares ($55 million aggregate liquidation amount) of 6.00% Series Preference Stock, 450,000 shares ($45 million aggregate liquidation amount) of Series 2007A 6.45% Preference Stock, and 500,000 shares ($50 million aggregate liquidation amount) of Series 2013A 5.60% Preference Stock.

In January 2017, the Company issued 1,750,000 shares of common stock to Southern Company and realized proceeds of $175 million. The proceeds were used for general corporate purposes, including the Company's continuous construction program.

Dividend Restrictions

The Company can only pay dividends to Southern Company out of retained earnings or paid-in-capital.

Assets Subject to Lien

The Company has granted a lien on its property at Plant Daniel in connection with the issuance of two series of pollution control revenue bonds with an aggregate outstanding principal amount of $41 million as of December 31, 2017. There are no agreements or other arrangements among the Southern Company system companies under which the assets of one company have been pledged or otherwise made available to satisfy obligations of Southern Company or any of its subsidiaries.

Bank Credit Arrangements

At December 31, 2017, committed credit arrangements with banks were as follows:



Expires										Executable Term Loans				Expires Within One Year
2018		2019		2020		Total		Unused		One Year		Two Years		Term Out		No Term Out
(in millions)						(in millions)				(in millions)				(in millions)
$	30	$	25	$	225	$	280	$	280	$	45	$	—	$	20	$	10

In November 2017, the Company amended $195 million of its multi-year credit arrangements to extend the maturity dates from 2017 and 2018 to 2020.

Most of the bank credit arrangements require payment of commitment fees based on the unused portion of the commitments. Commitment fees average less than ¹/₄ of 1% for the Company.

Subject to applicable market conditions, the Company expects to renew or replace its bank credit arrangements as needed, prior to expiration. In connection therewith, the Company may extend the maturity dates and/or increase or decrease the lending commitments thereunder.

Most of these bank credit arrangements contain covenants that limit the Company's debt level to 65% of total capitalization, as defined in the arrangements. For purposes of these definitions, debt excludes certain hybrid securities. At December 31, 2017, the Company was in compliance with these covenants.

Most of the $280 million of unused credit arrangements with banks provide liquidity support to the Company's pollution control revenue bonds and commercial paper program. The amount of variable rate pollution control revenue bonds outstanding requiring liquidity support as of December 31, 2017 was approximately $82 million. In addition, at December 31, 2017, the Company had $75 million of fixed rate pollution control revenue bonds outstanding that were required to be remarketed within the next 12 months.

For short-term cash needs, the Company borrows primarily through a commercial paper program that has the liquidity support of the Company's committed bank credit arrangements described above. The Company may also borrow through various other arrangements with banks. Commercial paper and short-term bank loans are included in notes payable on the balance sheets.

Details of short-term borrowings were as follows:



	Short-term Debt at the End of the Period
	Amount Outstanding		Weighted Average Interest Rate
	(in millions)
December 31, 2017:
Commercial paper	$	45	2.0%
December 31, 2016:
Commercial paper	$	168	1.1%
Short-term bank debt	100		1.5%
Total	$	268	1.2%

MISSISSIPPI POWER CO

Debt Disclosure [Line Items]

FINANCING

Going Concern

The Company's financial statement presentation contemplates continuation of the Company as a going concern as a result of Southern Company's anticipated ongoing financial support of the Company. Specifically, the Company has been informed by Southern Company that in the event sufficient funds are not available from external sources, Southern Company intends to provide the Company with loans and/or equity to fund the remaining indebtedness to mature and other cash needs over the next 12 months. As of December 31, 2017, the Company's current liabilities exceeded current assets by approximately $911 million primarily due to a $900 million unsecured term loan that matures on March 31, 2018. The Company expects to refinance the unsecured term loan with external security issuances and/or borrowings from financial institutions or Southern Company. To fund the Company's capital needs over the next 12 months, the Company intends to utilize operating cash flows, external security issuances, lines of credit, bank term loans, equity contributions from Southern Company and, to the extent necessary, loans from Southern Company.

Securities Due Within One Year

A summary of scheduled maturities and redemptions of securities due within one year at December 31, 2017 and 2016 was as follows:



	2017			2016
	(in millions)
Parent company loans	$	—		$	551
Senior notes	—			35
Bank term loans	900			—
Revenue bonds^(*)	90			40
Capitalized leases	—			3
Unamortized debt issuance expense	(1		)	—
Outstanding at December 31	$	989		$	629


(*)	Includes $50 million in revenue bonds classified as short term at December 31, 2017 that were remarketed in an index rate mode subsequent to December 31, 2017. Also includes $40 million in pollution control revenue bonds classified as short term since they are variable rate demand obligations supported by short-term credit facilities; however, the final maturity dates range from 2020 to 2028.

Maturities through 2022 applicable to total long-term debt are as follows: $900 million in 2018, $125 million in 2019, and $270 million in 2021. For long-term debt, other than revenue bonds, there are no scheduled maturities for 2020 and 2022.

Parent Company Loans and Equity Contributions

At December 31, 2016, the Company had $551 million of outstanding promissory notes to Southern Company.

In February 2017, the Company amended $551 million in promissory notes to Southern Company extending the maturity dates of the notes from December 1, 2017 to July 31, 2018. In the second quarter 2017, the Company borrowed an additional $40 million under a promissory note issued to Southern Company.

In June 2017, Southern Company made equity contributions totaling $1.0 billion to the Company. The Company used a portion of the proceeds to (i) prepay $300 million of the outstanding principal amount under its $1.2 billion unsecured term loan, which matures on March 30, 2018; (ii) repay all of the $591 million outstanding principal amount of promissory notes to Southern Company; and (iii) repay a $10 million short-term bank loan.

In September 2017, the Company issued a floating rate promissory note to Southern Company in an aggregate principal amount of up to $150 million bearing interest based on one-month LIBOR. The Company borrowed $109 million under this promissory note primarily to satisfy its federal income tax obligations for the quarter ending September 30, 2017 and subsequently repaid the promissory note upon receipt of its income tax refund from the U.S. federal government related to the settlement concerning deductible R&E expenditures. See Note 5 under "Section 174 Research and Experimental Deduction" for additional information. At December 31, 2017, the Company had no outstanding promissory notes to Southern Company.

Bank Term Loans

In March 2017, the Company issued a $9 million short-term bank note bearing interest at 5% per annum, which was repaid in April 2017.

In June 2017, the Company used a portion of the proceeds from Southern Company equity contributions to prepay $300 million of the outstanding principal amount under its $1.2 billion unsecured term loan, which matures on March 30, 2018, and to repay $10 million of the outstanding principal amount of bank loans. See "Parent Company Loans and Equity Contributions" herein for more information.

This unsecured term loan has a covenant that limits debt levels to 65% of total capitalization, as defined in the agreement. For purposes of this definition, debt excludes any long-term debt payable to affiliated trusts and other hybrid securities. At December 31, 2017, the Company was in compliance with its debt limit.

In August 2017, the Company repaid a $12.5 million short-term bank note.

At December 31, 2017, the Company had a $900 million unsecured term loan outstanding, which was reflected in the statements of capitalization as securities due within one year. At December 31, 2016, the Company had a $1.2 billion unsecured term loan outstanding, which was reflected in the statements of capitalization as long-term debt.

Senior Notes

At December 31, 2017 and 2016, the Company had $755 million and $790 million of senior notes outstanding, respectively, which included senior notes due within one year. These senior notes are effectively subordinated to the secured debt of the Company. See "Plant Daniel Revenue Bonds" below for additional information regarding the Company's secured indebtedness.

Plant Daniel Revenue Bonds

In 2011, in connection with the Company's election under its operating lease of Plant Daniel Units 3 and 4 to purchase the assets, the Company assumed the obligations of the lessor related to $270 million aggregate principal amount of Mississippi Business Finance Corporation Taxable Revenue Bonds, 7.13% Series 1999A due October 20, 2021, issued for the benefit of the lessor. These bonds are secured by Plant Daniel Units 3 and 4 and certain related personal property. The bonds were recorded at fair value as of the date of assumption, or $346 million, reflecting a premium of $76 million. See "Assets Subject to Lien" herein for additional information.

Pollution Control Revenue Bonds

Pollution control obligations represent loans to the Company from public authorities of funds derived from sales by such authorities of pollution control revenue bonds issued to finance pollution control and solid waste disposal facilities. The Company is required to make payments sufficient for the authorities to meet principal and interest requirements of such bonds. The amount of tax-exempt pollution control revenue bonds outstanding at December 31, 2017 and 2016 was $83 million.

Other Revenue Bonds

Other revenue bond obligations represent loans to the Company from a public authority of funds derived from the sale by such authority of revenue bonds issued to finance a portion of the costs of constructing the Kemper County energy facility and related facilities.

The Company had $50 million of such obligations outstanding related to tax-exempt revenue bonds at December 31, 2017 and 2016. Such amounts are reflected in the statements of capitalization as long-term debt.

Capital Leases

In 2013, the Company entered into an agreement to sell the air separation unit for the Kemper County energy facility and also entered into a 20-year nitrogen supply agreement. The nitrogen supply agreement was determined to be a sale/leaseback agreement, which resulted in a capital lease obligation of $74 million at December 31, 2016. Following the suspension of the Kemper IGCC, the Company entered into an asset purchase and settlement agreement in December 2017 with the lessor, which terminated the capital lease obligation. There were no contingent rentals in the contract and a portion of the monthly payment specified in the agreement was related to executory costs for the operation and maintenance of the air separation unit and excluded from the minimum lease payments. The minimum lease payments for 2017 were $7 million. See Note 3 under "Kemper County Energy facility" for additional information.

Assets Subject to Lien

The revenue bonds assumed in conjunction with the purchase of Plant Daniel Units 3 and 4 are secured by Plant Daniel Units 3 and 4 and certain related personal property. There are no agreements or other arrangements among the Southern Company system companies under which the assets of one company have been pledged or otherwise made available to satisfy the obligations of Southern Company or another of its other subsidiaries. See "Plant Daniel Revenue Bonds" herein for additional information.

On October 4, 2017, the Company executed agreements with its largest retail customer, Chevron Products Company (Chevron), to continue providing retail service to the Chevron refinery in Pascagoula, Mississippi through 2038, subject to the approval of the Mississippi PSC. The agreements grant Chevron a security interest in its co-generation assets, with a net book value of approximately $93 million, located at Chevron's refinery that is exercisable upon the occurrence of (i) certain bankruptcy events or (ii) other events of default coupled with specific reductions in steam output at the facility and a downgrade of the Company's credit rating to below investment grade by two of the three rating agencies.

Outstanding Classes of Capital Stock

The Company currently has preferred stock (including depositary shares which represent one-fourth of a share of preferred stock) and common stock authorized and outstanding. The preferred stock of the Company contains a feature that allows the holders to elect a majority of the Company's board of directors if preferred dividends are not paid for four consecutive quarters. Because such a potential redemption-triggering event is not solely within the control of the Company, this preferred stock is presented as "Cumulative Redeemable Preferred Stock" in a manner consistent with temporary equity under applicable accounting standards. The Company's preferred stock and depositary preferred stock, without preference between classes, rank senior to the Company's common stock with respect to payment of dividends and voluntary or involuntary dissolution. The preferred stock and depositary preferred stock is subject to redemption at the option of the Company at a redemption price equal to 100% of the liquidation amount of the stock. Information for each outstanding series is in the table below:



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.

Dividend Restrictions

The Company can only pay dividends to Southern Company out of retained earnings or paid-in-capital.

Bank Credit Arrangements

At December 31, 2017, committed credit arrangements with banks were as follows:

Expires

Executable

Term Loans

Expires Within One Year

2018

Total

Unused

One

Year

Two

Years

Term Out

No Term Out

(in millions)

$100

$—

$100

In November 2017, the Company amended certain of its one-year credit arrangements in an aggregate amount of $100 million to extend the maturity dates from 2017 to 2018.

Subject to applicable market conditions, the Company expects to renew its bank credit arrangements, as needed, prior to expiration. In connection therewith, the Company may extend the maturity dates and/or increase or decrease the lending commitments thereunder.

Most of these bank credit arrangements require payment of commitment fees based on the unused portions of the commitments or to maintain compensating balances with the banks. Commitment fees average less than 1/4 of 1% for the Company. Compensating balances are not legally restricted from withdrawal.

Most of these bank credit arrangements contain covenants that limit the Company's debt levels to 65% of total capitalization, as defined in the agreements. For purposes of these definitions, debt excludes certain hybrid securities.

A portion of the $100 million unused credit with banks is allocated to provide liquidity support to the Company's pollution control revenue bonds and its commercial paper borrowings. The amount of variable rate pollution control revenue bonds outstanding requiring liquidity support as of December 31, 2017 was $40 million. In addition, at December 31, 2017, the Company had approximately $50 million of fixed rate revenue bonds that were remarketed from a long-term interest rate mode to an index rate mode, subsequent to December 31, 2017.

At December 31, 2017 and 2016, there was no commercial paper debt outstanding.

At December 31, 2017 and 2016, there was $4 million and $23 million, respectively, of short-term debt outstanding.

SOUTHERN POWER CO

Debt Disclosure [Line Items]

FINANCING

Southern Power Company's senior notes, bank term loans, commercial paper, and Facility (as defined herein) are unsecured senior indebtedness, which rank equally with all other unsecured and unsubordinated debt of Southern Power Company. The Company's subsidiaries are not issuers, borrowers, or obligors, as applicable, under the senior notes, borrowings from financial institutions, commercial paper, or the Facility. The senior notes, borrowings from financial institutions, commercial paper, and the Facility are effectively subordinated to any future secured debt of Southern Power Company and any potential claims of creditors of the Company's subsidiaries. As of December 31, 2017, the Company had no secured debt.

Securities Due Within One Year

At December 31, 2017, the Company had $420 million in term loans and $350 million of senior notes due within one year. At December 31, 2016, the Company had a $60 million term loan, $500 million of senior notes, and $1 million of long-term notes due within one year.

Maturities of long-term debt for the next five years are as follows:



	December 31, 2017
	(in millions)
2018	$	770
2019	600
2020	825
2021	300
2022^(*)	677


(*)	Represents euro-denominated debt at the U.S. dollar denominated hedge settlement amount.

Senior Notes

In November 2017, the Company issued $525 million aggregate principal amount of Series 2017A Floating Rate Senior Notes due December 20, 2020, which bear interest based on three-month LIBOR. The net proceeds were used to redeem all of the $500 million aggregate principal amount of Series 2015D 1.85% Senior Notes due December 1, 2017 and to repay a portion of the Company's outstanding short-term debt.

At December 31, 2017 and 2016, the Company had $5.5 billion and $5.3 billion of senior notes outstanding, respectively, which included senior notes due within one year.

Other Long-Term Notes

In September 2017, the Company amended its $60 million aggregate principal amount floating rate term loan to, among other things, increase the aggregate principal amount to $100 million and extend the maturity date from September 2017 to October 2018. The additional $40 million of proceeds were used to repay existing indebtedness and for other general corporate purposes.

At December 31, 2017, outstanding term loans were included in securities due within one year.

The outstanding term loans as of December 31, 2017 have a covenant that limits debt levels to 65% of total capitalization, as defined in the agreements. For purposes of this definition, debt excludes any project debt incurred by certain subsidiaries of the company to the extent such debt is non-recourse to the company, and capitalization excludes the capital stock or other equity attributable to such subsidiary.

At December 31, 2017, the Company was in compliance with its debt limits.

Bank Credit Arrangements

Company Credit Facilities

At December 31, 2017, the Company had a committed credit facility (Facility) of $750 million expiring in 2022, of which $22 million has been used for letters of credit and $728 million remains unused. In May 2017, the Company amended the Facility, which, among other things, extended the maturity date from 2020 to 2022 and increased the Company's borrowing ability under the Facility to $750 million from $600 million. Proceeds from the Facility may be used for working capital and general corporate purposes as well as liquidity support for the Company's commercial paper program. As of December 31, 2016, $78 million was used for letters of credit and $522 million remained unused. The Facility does not contain a material adverse change clause at the time of borrowing. Subject to applicable market conditions, the Company expects to renew or replace the Facility, as needed, prior to expiration. In connection therewith, the Company may extend the maturity date and/or increase or decrease the lending commitment thereunder. The Company's subsidiaries are not parties to the Facility.

The Company is required to pay a commitment fee on the unused balance of the Facility. This fee is less than 1/4 of 1%. The Facility contains a covenant that limits the ratio of debt to capitalization (each as defined in the Facility) to a maximum of 65%. For purposes of this definition, debt excludes any project debt incurred by certain subsidiaries of the Company to the extent such debt is non-recourse to the Company, and capitalization excludes the capital stock or other equity attributable to such subsidiary. At December 31, 2017, the Company was in compliance with its debt limits.

The Company also has a $120 million continuing letter of credit facility expiring in 2019 for standby letters of credit. At December 31, 2017, $101 million has been used for letters of credit, primarily as credit support for PPA requirements, and $19 million remains unused. At December 31, 2016, the total amount available under this facility was $82 million. The Company's subsidiaries are not parties to this letter of credit facility.

In addition, at both December 31, 2017 and 2016, the Company has $113 million of cash collateral posted related to PPA requirements, which is included in other deferred charges and assets in the consolidated balance sheets.

Commercial Paper Program

The Company's commercial paper program is used to finance acquisition and construction costs related to electric generating facilities and for general corporate purposes. The Company's subsidiaries are not parties to the commercial paper program. Commercial paper is included in notes payable in the consolidated balance sheets as noted below:



	Commercial Paper at the End of the Period
	Amount Outstanding		Weighted Average Interest Rate
	(in millions)
December 31, 2017	$	105	2.0	%
December 31, 2016	$	—	N/A

Subsidiary Project Credit Facilities

In connection with the construction of solar facilities by RE Tranquillity LLC, RE Garland Holdings LLC, and RE Roserock LLC, indirect subsidiaries of the Company, each subsidiary had entered into separate credit agreements (Project Credit Facilities), which were non-recourse to the Company (other than the subsidiary party to the agreement). Each Project Credit Facility provided (a) a senior secured construction loan credit facility, (b) a senior secured bridge loan facility, and (c) a senior secured letter of credit facility that was secured by the membership interests of the respective project company, with proceeds directed to finance project costs related to the respective solar facilities. Each Project Credit Facility was secured by the assets of the applicable project subsidiary and membership interests of the applicable project subsidiary. The Tranquillity and Garland Project Credit Facilities were fully repaid on October 14, 2016 and December 29, 2016, respectively. The table below summarizes the Roserock Project Credit Facility as of December 31, 2016, which was extended to January 31, 2017 and fully repaid on January 17, 2017.



	Construction Loan Facility		Bridge Loan Facility		Total Loan Facility		Loan Facility Undrawn		Letter of Credit Facility		Letter of Credit Facility Undrawn
	(in millions)
December 31, 2016	$	63	$	180	$	243	$	34	$	23	$	16

The Project Credit Facilities had no amount outstanding at December 31, 2017 and $209 million outstanding with a weighted average interest rate of 2.1% as of December 31, 2016.

Assets Subject to Lien

Under the terms of the PPA and the expansion PPA for the Mankato project, approximately $442 million of assets, primarily related to property, plant, and equipment, are subject to lien at December 31, 2017. See Note 11 for additional information.

Roserock is in a litigation dispute with McCarthy regarding damage to certain solar panels during installation. In connection therewith, Roserock is withholding payments of approximately $26 million from McCarthy, and McCarthy has filed mechanic's liens on the Roserock facility for the same amount. See Note 3 for additional information.

Dividend Restrictions

The Company can only pay dividends to Southern Company out of retained earnings or paid-in-capital.

SOUTHERN Co GAS

Debt Disclosure [Line Items]

FINANCING

The Company's 100%-owned subsidiary, Southern Company Gas Capital, was established to provide for certain of the Company's ongoing financing needs through a commercial paper program, the issuance of various debt, hybrid securities, and other financing arrangements. Southern Company Gas fully and unconditionally guarantees all debt issued by Southern Company Gas Capital and the gas facility revenue bonds issued by Pivotal Utility Holdings. Additionally, substantially all of Nicor Gas' properties are subject to the lien of the indenture securing its first mortgage bonds. Nicor Gas is not permitted by regulation to make loans to affiliates or utilize Southern Company Gas Capital for its financing needs.

Securities Due Within One Year

The current portion of long-term debt is composed of the portion of its long-term debt due within the next 12 months. At December 31, 2017, the Company had $157 million of senior notes due within one year, including the fair value adjustment attributable to the application of acquisition accounting. At December 31, 2016, the Company had $22 million of medium-term notes due within one year.

Long-Term Debt

Long-term debt of the Company at December 31, 2017 and 2016 consisted of Series A, Series B, and Series C medium-term notes of Atlanta Gas Light; senior notes of Southern Company Gas Capital; first mortgage bonds of Nicor Gas; and gas facility revenue bonds of Pivotal Utility Holdings.

Maturities through 2022 applicable to total long-term debt are as follows: $155 million in 2018; $350 million in 2019; $330 million in 2021; $93 million in 2022; and $4.6 billion thereafter. There are no material scheduled maturities in 2020.

Medium-Term Notes

In July 2017, Atlanta Gas Light repaid at maturity $22 million of medium-term notes. The amount of medium-term notes outstanding at December 31, 2017 and 2016 was $159 million and $181 million, respectively, including securities due within one year.

Senior Notes

In May 2017, Southern Company Gas Capital issued $450 million aggregate principal amount of Series 2017A 4.40% Senior Notes due May 30, 2047. The proceeds were used to repay the Company's short-term indebtedness and for general corporate purposes. The amount of senior notes outstanding at December 31, 2017 and 2016 was $4.2 billion and $3.7 billion, respectively, including securities due within one year.

First Mortgage Bonds

Nicor Gas had $1.0 billion and $625 million of first mortgage bonds outstanding at December 31, 2017 and 2016, respectively. These bonds have been issued with maturities ranging from 2019 to 2057.

Gas Facility Revenue Bonds

Pivotal Utility Holdings is party to a series of loan agreements with the New Jersey Economic Development Authority and Brevard County, Florida under which five series of gas facility revenue bonds have been issued with maturities ranging from 2022 to 2033. These revenue bonds are issued by state agencies or counties to investors, and proceeds from each issuance then are loaned to Pivotal Utility Holdings. The amount of gas facility revenue bonds outstanding at December 31, 2017 and 2016 was $200 million.

The Elizabethtown Gas asset sale agreement requires that bonds representing $180 million of the total that are currently eligible for redemption at par be redeemed on or prior to consummation of the sale. The ultimate outcome of this matter cannot be determined at this time. See Note 11 under "Proposed Sale of Elizabethtown Gas and Elkton Gas" for additional information.

Parent Company Note

On January 4, 2018, Southern Company Gas issued a floating rate promissory note to Southern Company in an aggregate principal amount of $100 million due July 31, 2018, bearing interest based on one-month LIBOR.

Dividend Restrictions

By regulation, Nicor Gas is restricted, to the extent of its retained earnings balance, in the amount it can dividend or loan to affiliates and is not permitted to make money pool loans to affiliates. The New Jersey BPU restricts the amount Elizabethtown Gas can dividend to its parent company to 70% of its quarterly net income. Additionally, as stipulated in the New Jersey BPU's order approving the Merger, the Company is prohibited from paying dividends to its parent company, Southern Company, if the Company's senior unsecured debt rating falls below investment grade. As of December 31, 2017, the amount of subsidiary retained earnings restricted for dividend payment totaled $719 million.

Bank Credit Arrangements

Credit Facilities

At December 31, 2017, committed credit arrangements with banks were as follows:



Company	Expires 2022		Unused
	(in millions)
Southern Company Gas Capital	$	1,400	$	1,390
Nicor Gas	500		500
Total	$	1,900	$	1,890

In May 2017, Southern Company Gas Capital and Nicor Gas terminated their existing credit arrangements for $1.3 billion and $700 million, respectively, which were to mature in 2017 and 2018, and entered into a new multi-year credit arrangement (Facility) currently allocated for $1.4 billion and $500 million, respectively, with a maturity date of 2022, as reflected in the table above. Pursuant to the Facility, the allocations between Southern Company Gas Capital and Nicor Gas may be adjusted.

The Facility contains a covenant that limits the ratio of debt to capitalization (as defined in each facility) to a maximum of 70% for each of the Company and Nicor Gas and contains a cross-acceleration provision to other indebtedness (including guarantee obligations) of the applicable company. Such cross-acceleration provision to other indebtedness would trigger an event of default of the applicable company if the Company or Nicor Gas defaulted on indebtedness, the payment of which was then accelerated. At December 31, 2017, both companies were in compliance with such covenant. The Facility does not contain a material adverse change clause at the time of borrowings.

Commercial Paper Programs

The Company maintains commercial paper programs at Southern Company Gas Capital and at Nicor Gas that consist of short-term, unsecured promissory notes. Nicor Gas' commercial paper program supports working capital needs at Nicor Gas as Nicor Gas is not permitted to make money pool loans to affiliates. All of the Company's other subsidiaries benefit from Southern Company Gas Capital's commercial paper program. Commercial paper is included in notes payable in the balance sheets.

Details of commercial paper borrowings outstanding were as follows:



	Short-term Debt at the End of the Period
	Amount Outstanding		Weighted Average Interest Rate
	(in millions)
December 31, 2017:
Southern Company Gas Capital	$	1,243	1.73	%
Nicor Gas	275		1.83
Total	$	1,518	1.75	%

December 31, 2016:
Southern Company Gas Capital	$	733	1.09	%
Nicor Gas	524		0.95
Total	$	1,257	1.03	%