SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Schedule of costs for affiliate transactions

Mississippi Power's and Southern Power's power purchases from affiliates through the Southern Company power pool are included in purchased power on their respective statements of income and were as follows:

	Mississippi Power		Southern Power
	(in millions)
2019	$	3	$	14
2018	15		41
2017	16		27

Transportation costs under these agreements in 2019, 2018, and 2017 were as follows:

	Alabama Power		Georgia Power		Southern Power		Southern Company Gas
	(in millions)
2019	$	17	$	99	$	28	$	31
2018	8		101		25		32
2017	9		102		25		32

In November 2018, SNG purchased the natural gas lateral pipeline serving Plant McDonough Units 4 through 6 from Georgia Power at net book value, as approved by the Georgia PSC. In January 2020, SNG paid Georgia Power $142 million, which included $71 million contributed to SNG by Southern Company Gas for its proportionate share. During the interim period, Georgia Power received a discounted shipping rate to reflect the deferred consideration and SNG constructed an extension to the pipeline.

SCS, as agent for the traditional electric operating companies and Southern Power, has agreements with certain subsidiaries of Southern Company Gas to purchase natural gas. Natural gas purchases made under these agreements were immaterial for Alabama Power and Mississippi Power and as follows for Georgia Power and Southern Power in 2019, 2018, and 2017:

	Georgia Power		Southern Power
	(in millions)
2019	$	4	$	64
2018	21		119
2017	22		119

Costs for these services from SCS in 2019, 2018, and 2017 were as follows:

	Alabama Power		Georgia Power		Mississippi Power		Southern Power(*)		Southern Company Gas
	(in millions)
2019	$	527	$	704	$	118	$	90	$	183
2018	508		653		104		98		194
2017	479		625		140		218		63

(*)

Prior to December 2017, Southern Power had no employees but was billed for employee-related costs from SCS.

The approximate rates for 2019, 2018, and 2017 are as follows:

	2019		2018		2017
Alabama Power	3.1	%	3.0	%	2.9	%
Georgia Power	2.6	%	2.6	%	2.7	%
Mississippi Power	3.7	%	4.2	%	3.4	%
Southern Company Gas	2.9	%	2.9	%	2.9	%

Schedule of concentration of revenue

The following table shows the percentage of total revenues for Southern Power's top three customers for each of the years presented:

	2019		2018		2017
Georgia Power	9.0	%	9.8	%	11.3	%
Duke Energy Corporation	N/A		6.8	%	6.7	%
Southern California Edison	6.8	%	6.2	%	N/A
Morgan Stanley Capital Group	4.9	%	N/A		4.5	%

Schedule of total AFUDC and interest capitalized

Total AFUDC and interest capitalized for the Registrants in 2019, 2018, and 2017 was as follows:

	Southern Company		Alabama Power		Georgia Power(*)		Mississippi Power		Southern Power		Southern Company Gas
	(in millions)
2019	$	202	$	71	$	103	$	—	$	15	$	13
2018	210		84		94		—		17		14
2017	249		54		63		72		11		19

(*)

See Note 2 under "Georgia Power – Nuclear Construction" for information on the inclusion of a portion of construction costs related to Plant Vogtle Units 3 and 4 in Georgia Power's rate base.

Schedule of average AFUDC composite rates

The average AFUDC composite rates for 2019, 2018, and 2017 for the traditional electric operating companies and the natural gas distribution utilities were as follows:

	2019		2018		2017
Alabama Power	8.4	%	8.3	%	8.3	%
Georgia Power(*)	6.9	%	7.3	%	5.6	%
Mississippi Power	7.3	%	3.3	%	6.7	%
Southern Company Gas:
Atlanta Gas Light	7.8	%	7.9	%	8.1	%
Chattanooga Gas	7.1	%	7.4	%	7.4	%
Nicor Gas	2.3	%	2.1	%	1.2	%

(*)

Excludes AFUDC related to the construction of Plant Vogtle Units 3 and 4. See Note 2 under "Georgia Power – Nuclear Construction" for additional information.

Schedule of goodwill balances

At December 31, 2019 and 2018, goodwill was as follows:

	At December 31, 2019		At December 31, 2018
	(in millions)
Southern Company	$	5,280	$	5,315
Southern Company Gas:
Gas distribution operations	$	4,034	$	4,034
Gas marketing services	981		981
Southern Company Gas total	$	5,015	$	5,015

Schedule of intangible assets subject to amortization

At December 31, 2019 and 2018, other intangible assets were as follows:

	At December 31, 2019							At December 31, 2018
	Gross Carrying Amount		Accumulated Amortization			Other Intangible Assets, Net		Gross Carrying Amount		Accumulated Amortization			Other Intangible Assets, Net
	(in millions)							(in millions)
Southern Company
Other intangible assets subject to amortization:
Customer relationships(a)	$	212	$	(116	)	$	96	$	223	$	(94	)	$	129
Trade names(a)	64		(25		)	39		70		(21		)	49
Storage and transportation contracts	64		(62		)	2		64		(54		)	10
PPA fair value adjustments(b)	390		(69		)	321		405		(61		)	344
Other	11		(8		)	3		11		(5		)	6
Total other intangible assets subject to amortization	$	741	$	(280	)	$	461	$	773	$	(235	)	$	538
Other intangible assets not subject to amortization:
Federal Communications Commission licenses	75		—			75		75		—			75
Total other intangible assets	$	816	$	(280	)	$	536	$	848	$	(235	)	$	613
Southern Power
Other intangible assets subject to amortization:
PPA fair value adjustments(b)	$	390	$	(69	)	$	321	$	405	$	(61	)	$	344
Southern Company Gas
Other intangible assets subject to amortization:
Gas marketing services
Customer relationships	$	156	$	(104	)	$	52	$	156	$	(84	)	$	72
Trade names	26		(10		)	16		26		(7		)	19
Wholesale gas services
Storage and transportation contracts	64		(62		)	2		64		(54		)	10
Total other intangible assets subject to amortization	$	246	$	(176	)	$	70	$	246	$	(145	)	$	101

(a) The decrease in the gross carrying amount during 2019 primarily reflects the sales of two PowerSecure business units. See Note 15 for additional information.

(b)

The decrease in the gross carrying amount during 2019 reflects the sale of Plant Nacogdoches, partially offset by additional PPA fair value adjustments related to the acquisition of DSGP. See Note 15 under "Southern Power" for additional information.

Schedule of intangible assets not subject to amortization

At December 31, 2019 and 2018, other intangible assets were as follows:

	At December 31, 2019							At December 31, 2018
	Gross Carrying Amount		Accumulated Amortization			Other Intangible Assets, Net		Gross Carrying Amount		Accumulated Amortization			Other Intangible Assets, Net
	(in millions)							(in millions)
Southern Company
Other intangible assets subject to amortization:
Customer relationships(a)	$	212	$	(116	)	$	96	$	223	$	(94	)	$	129
Trade names(a)	64		(25		)	39		70		(21		)	49
Storage and transportation contracts	64		(62		)	2		64		(54		)	10
PPA fair value adjustments(b)	390		(69		)	321		405		(61		)	344
Other	11		(8		)	3		11		(5		)	6
Total other intangible assets subject to amortization	$	741	$	(280	)	$	461	$	773	$	(235	)	$	538
Other intangible assets not subject to amortization:
Federal Communications Commission licenses	75		—			75		75		—			75
Total other intangible assets	$	816	$	(280	)	$	536	$	848	$	(235	)	$	613
Southern Power
Other intangible assets subject to amortization:
PPA fair value adjustments(b)	$	390	$	(69	)	$	321	$	405	$	(61	)	$	344
Southern Company Gas
Other intangible assets subject to amortization:
Gas marketing services
Customer relationships	$	156	$	(104	)	$	52	$	156	$	(84	)	$	72
Trade names	26		(10		)	16		26		(7		)	19
Wholesale gas services
Storage and transportation contracts	64		(62		)	2		64		(54		)	10
Total other intangible assets subject to amortization	$	246	$	(176	)	$	70	$	246	$	(145	)	$	101

(a) The decrease in the gross carrying amount during 2019 primarily reflects the sales of two PowerSecure business units. See Note 15 for additional information.

(b)

The decrease in the gross carrying amount during 2019 reflects the sale of Plant Nacogdoches, partially offset by additional PPA fair value adjustments related to the acquisition of DSGP. See Note 15 under "Southern Power" for additional information.

Schedule of amortization associated with other intangible assets

Amortization associated with other intangible assets in 2019, 2018, and 2017 was as follows:

	2019		2018		2017
	(in millions)
Southern Company(a)	$	61	$	89	$	124
Southern Power(b)	19		25		25
Southern Company Gas:
Gas marketing services	$	23	$	32	$	54
Wholesale gas services(b)	8		20		32
Southern Company Gas total	$	31	$	52	$	86

(a) Includes $27 million, $45 million, and $57 million in 2019, 2018, and 2017, respectively, recorded as a reduction to operating revenues.

(b)

Recorded as a reduction to operating revenues.

Schedule of amortization of other intangible assets

At December 31, 2019, the estimated amortization associated with other intangible assets for the next five years is as follows:

	2020		2021		2022		2023		2024
	(in millions)
Southern Company(*)	$	48	$	42	$	38	$	37	$	35
Southern Power(*)	20		20		20		20		20
Southern Company Gas	19		13		10		9		7

(*)

Excludes amounts related to held for sale assets. See Note 15 under "Southern Power – Sales of Natural Gas and Biomass Plants" for additional information.

Reconciliation of cash, and cash equivalents

The following tables provide a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheets that total to the amounts shown in the statements of cash flows for the Registrants that had restricted cash at December 31, 2019 and/or 2018:

	Southern Company		Southern Company Gas
	(in millions)
At December 31, 2019
Cash and cash equivalents	$	1,975	$	46
Restricted cash:
Other accounts and notes receivable	3		3
Total cash, cash equivalents, and restricted cash	$	1,978	$	49

	Southern Company		Georgia Power		Southern Company Gas
	(in millions)
At December 31, 2018
Cash and cash equivalents	$	1,396	$	4	$	64
Cash and cash equivalents classified as assets held for sale	9		—		—
Restricted cash:
Restricted cash	—		108		—
Other accounts and notes receivable	114		—		6
Total cash, cash equivalents, and restricted cash	$	1,519	$	112	$	70

Reconciliation of restricted cash and cash equivalents

The following tables provide a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheets that total to the amounts shown in the statements of cash flows for the Registrants that had restricted cash at December 31, 2019 and/or 2018:

	Southern Company		Southern Company Gas
	(in millions)
At December 31, 2019
Cash and cash equivalents	$	1,975	$	46
Restricted cash:
Other accounts and notes receivable	3		3
Total cash, cash equivalents, and restricted cash	$	1,978	$	49

	Southern Company		Georgia Power		Southern Company Gas
	(in millions)
At December 31, 2018
Cash and cash equivalents	$	1,396	$	4	$	64
Cash and cash equivalents classified as assets held for sale	9		—		—
Restricted cash:
Restricted cash	—		108		—
Other accounts and notes receivable	114		—		6
Total cash, cash equivalents, and restricted cash	$	1,519	$	112	$	70

Schedule of storm damage reserves

In accordance with their respective state PSC orders, the traditional electric operating companies accrued the following amounts related to storm damage reserves in 2019, 2018, and 2017:

	Southern    Company(a)(b)		Alabama Power(b)		Georgia Power		Mississippi Power
	(in millions)
2019	$	170	$	139	$	30	$	1
2018	74		16		30		1
2017	41		4		30		3

(a) Includes accruals at Gulf Power of $26.9 million in 2018 and $3.5 million in 2017. See Note 15 under "Southern Company" for information regarding the sale of Gulf Power.

(b)

Includes $39 million applied in 2019 to Alabama Power's NDR from its remaining excess deferred income tax regulatory liability balance in accordance with an Alabama PSC order.

Schedule of net investment in domestic and international leveraged leases

Southern Company's net investment in domestic and international leveraged leases consists of the following at December 31:

	2019			2018
	(in millions)
Net rentals receivable	$	1,410		$	1,563
Unearned income	(622		)	(765		)
Investment in leveraged leases	788			798
Deferred taxes from leveraged leases	(238		)	(255		)
Net investment in leveraged leases	$	550		$	543

Summary of the components of income from leveraged leases

A summary of the components of income from the leveraged leases follows:

	2019		2018			2017
	(in millions)
Pretax leveraged lease income	$	11	$	25		$	25
Net impact of Tax Reform Legislation	—		—			48
Income tax expense	—		(6		)	(9		)
Net leveraged lease income	$	11	$	19		$	64

Schedule of AOCI (loss) balances, net of tax effects

AOCI (loss) balances, net of tax effects, for Southern Company, Southern Power, and Southern Company Gas were as follows:

	Qualifying Hedges			Pension and Other Postretirement Benefit Plans			Accumulated Other Comprehensive Income (Loss)
	(in millions)
Southern Company
Balance at December 31, 2018	$	(121	)	$	(82	)	$	(203	)
Current period change	(58		)	(60		)	(118		)
Balance at December 31, 2019	$	(179	)	$	(142	)	$	(321	)
Southern Power
Balance at December 31, 2018	$	36		$	(20	)	$	16
Current period change	(25		)	(17		)	(42		)
Balance at December 31, 2019	$	11		$	(37	)	$	(26	)
Southern Company Gas
Balance at December 31, 2018	$	(3	)	$	29		$	26
Current period change	(3		)	(16		)	(19		)
Balance at December 31, 2019	$	(6	)	$	13		$	7