Derivatives (Tables)

6 Months Ended

Jun. 30, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of derivatives

At June 30, 2015, the net volume of energy-related derivative contracts for natural gas positions for the Southern Company system, together with the longest hedge date over which the respective entity is hedging its exposure to the variability in future cash flows for forecasted transactions and the longest non-hedge date for derivatives not designated as hedges, were as follows:

	Net Purchased mmBtu	Longest Hedge Date	Longest Non-Hedge Date
	(in millions)
Southern Company	220	2020	2017
Alabama Power	49	2018	—
Georgia Power	47	2017	—
Gulf Power	80	2020	—
Mississippi Power	43	2018	—
Southern Power	1	2015	2017

Notional amount of interest rate derivatives

At June 30, 2015, the following interest rate derivatives were outstanding:

	Notional Amount		Interest Rate Received	Weighted Average Interest Rate Paid	Hedge Maturity Date	Fair Value Gain (Loss) at June 30, 2015
	(in millions)					(in millions)
Cash Flow Hedges of Forecasted Debt
Alabama Power	$	200	3-month LIBOR	2.93%	October 2025	$	(7	)
Georgia Power	350		3-month LIBOR	2.57%	November 2025	(1		)
Cash Flow Hedges of Existing Debt
Georgia Power	250		3-month LIBOR + 0.32%	0.75%	March 2016	—
Georgia Power	200		3-month LIBOR + 0.40%	1.01%	August 2016	—
Fair Value Hedges on Existing Debt
Southern Company	250		1.30%	3-month LIBOR + 0.17%	August 2017	2
Southern Company	300		2.75%	3-month LIBOR + 0.92%	June 2020	1
Georgia Power	250		5.40%	3-month LIBOR + 4.02%	June 2018	1
Georgia Power	200		4.25%	3-month LIBOR + 2.46%	December 2019	1
Total	$	2,000				$	(3	)

Fair value of energy-related derivatives and interest rate derivatives

At June 30, 2015, the fair value of energy-related derivatives and interest rate derivatives was reflected in the balance sheets as follows:

Asset Derivatives at June 30, 2015
	Fair Value
Derivative Category and Balance Sheet Location	Southern Company		Alabama Power		Georgia Power		Gulf Power		Mississippi Power		Southern Power
	(in millions)
Derivatives designated as hedging instruments for regulatory purposes
Energy-related derivatives:
Other current assets	$	5	$	2	$	3	$	—	$	—	N/A
Derivatives designated as hedging instruments in cash flow and fair value hedges
Interest rate derivatives:
Other current assets	$	11	$	—	$	5	$	—	$	—	$	—
Total asset derivatives	$	16	$	2	$	8	$	—	$	—	$	—

Liability Derivatives at June 30, 2015
	Fair Value
Derivative Category and Balance Sheet Location	Southern Company		Alabama Power		Georgia Power		Gulf Power		Mississippi Power		Southern Power
	(in millions)
Derivatives designated as hedging instruments for regulatory purposes
Energy-related derivatives:
Other current liabilities(*)	$	99	$	31	$	15	$	32	$	21
Other deferred credits and liabilities	81		17		2		42		20
Total derivatives designated as hedging instruments for regulatory purposes	$	180	$	48	$	17	$	74	$	41	N/A
Derivatives designated as hedging instruments in cash flow and fair value hedges
Interest rate derivatives:
Other current liabilities(*)	$	8	$	7	$	1	$	—	$	—	$	—
Other deferred credits and liabilities	6		—		3		—		—		—
Total derivatives designed as hedging instruments in cash flow and fair value hedges	$	14	$	7	$	4	$	—	$	—	$	—
Total liability derivatives	$	194	$	55	$	21	$	74	$	41	$	—

(*) Gulf Power includes current liabilities related to derivatives designated as hedging instruments in "Liabilities from risk management activities."

At December 31, 2014, the fair value of energy-related derivatives and interest rate derivatives was reflected in the balance sheets as follows:

Asset Derivatives at December 31, 2014
	Fair Value
Derivative Category and Balance Sheet Location	Southern Company		Alabama Power		Georgia Power		Gulf Power		Mississippi Power		Southern Power
	(in millions)
Derivatives designated as hedging instruments for regulatory purposes
Energy-related derivatives:
Other current assets	$	7	$	1	$	6	$	—	$	—
Other deferred charges and assets	—		—		1		—		—
Total derivatives designated as hedging instruments for regulatory purposes	$	7	$	1	$	7	$	—	$	—	N/A
Derivatives designated as hedging instruments in cash flow and fair value hedges
Interest rate derivatives:
Other current assets	$	7	$	—	$	5	$	—	$	—	$	—
Other deferred charges and assets	1		—		1		—		—		—
Total derivatives designated as hedging instruments in cash flow and fair value hedges	$	8	$	—	$	6	$	—	$	—	$	—
Derivatives not designated as hedging instruments
Energy-related derivatives:
Other current assets	$	6	$	—	$	—	$	—	$	—	$	5
Total asset derivatives	$	21	$	1	$	13	$	—	$	—	$	5

Liability Derivatives at December 31, 2014
	Fair Value
Derivative Category and Balance Sheet Location	Southern Company		Alabama Power		Georgia Power		Gulf Power		Mississippi Power		Southern Power
	(in millions)
Derivatives designated as hedging instruments for regulatory purposes
Energy-related derivatives:
Other current liabilities(*)	$	118	$	32	$	23	$	37	$	26
Other deferred credits and liabilities	79		21		4		35		19
Total derivatives designated as hedging instruments for regulatory purposes	$	197	$	53	$	27	$	72	$	45	N/A
Derivatives designated as hedging instruments in cash flow and fair value hedges
Interest rate derivatives:
Other current liabilities(*)	$	17	$	8	$	9	$	—	$	—	$	—
Other deferred credits and liabilities	7		—		5		—		—		—
Total derivatives designated as hedging instruments in cash flow and fair value hedges	$	24	$	8	$	14	$	—	$	—	$	—
Derivatives not designated as hedging instruments
Energy-related derivatives:
Other current liabilities	$	4	$	—	$	—	$	—	$	—	$	4
Total liability derivatives	$	225	$	61	$	41	$	72	$	45	$	4

(*) Gulf Power includes current liabilities related to derivatives designated as hedging instruments in "Liabilities from risk management activities."

Offsetting disclosure tables

Amounts related to energy-related derivative contracts and interest rate derivative contracts at June 30, 2015 and December 31, 2014 are presented in the following tables.

Derivative Contracts at June 30, 2015
	Fair Value
	Southern Company			Alabama Power			Georgia Power			Gulf Power		Mississippi Power		Southern Power
	(in millions)
Assets
Energy-related derivatives:
Energy-related derivatives presented in the Balance Sheet (a)	$	5		$	2		$	3		$	—	$	—	$	—
Gross amounts not offset in the Balance Sheet (b)	(5		)	(2		)	(3		)	—		—		—
Net energy-related derivative assets	$	—		$	—		$	—		$	—	$	—	$	—
Interest rate derivatives:
Interest rate derivatives presented in the Balance Sheet (a)	$	11		$	—		$	5		$	—	$	—	$	—
Gross amounts not offset in the Balance Sheet (b)	(8		)	—			(3		)	—		—		—
Net interest rate derivative assets	$	3		$	—		$	2		$	—	$	—	$	—
Liabilities
Energy-related derivatives:
Energy-related derivatives presented in the Balance Sheet (a)	$	180		$	48		$	17		$	74	$	41	$	—
Gross amounts not offset in the Balance Sheet (b)	(5		)	(2		)	(3		)	—		—		—
Net energy-related derivative liabilities	$	175		$	46		$	14		$	74	$	41	$	—
Interest rate derivatives:
Interest rate derivatives presented in the Balance Sheet (a)	$	14		$	7		$	4		$	—	$	—	$	—
Gross amounts not offset in the Balance Sheet (b)	(8		)	—			(3		)	—		—		—
Net interest rate derivative liabilities	$	6		$	7		$	1		$	—	$	—	$	—

(a) None of the registrants offsets fair value amounts for multiple derivative instruments executed with the same counterparty on the balance sheets; therefore, gross and net amounts of derivative assets and liabilities presented on the balance sheets are the same.

(b) Includes gross amounts subject to netting terms that are not offset on the balance sheets and any cash/financial collateral pledged or received.

Derivative Contracts at December 31, 2014
	Fair Value
	Southern Company			Alabama Power		Georgia Power			Gulf Power		Mississippi Power		Southern Power
	(in millions)
Assets
Energy-related derivatives:
Energy-related derivatives presented in the Balance Sheet (a)	$	13		$	1	$	7		$	—	$	—	$	5
Gross amounts not offset in the Balance Sheet (b)	(9		)	—		(7		)	—		—		—
Net energy-related derivative assets	$	4		$	1	$	—		$	—	$	—	$	5
Interest rate derivatives:
Interest rate derivatives presented in the Balance Sheet (a)	$	8		$	—	$	6		$	—	$	—	$	—
Gross amounts not offset in the Balance Sheet (b)	(8		)	—		(6		)	—		—		—
Net interest rate derivative assets	$	—		$	—	$	—		$	—	$	—	$	—
Liabilities
Energy-related derivatives:
Energy-related derivatives presented in the Balance Sheet (a)	$	201		$	53	$	27		$	72	$	45	$	4
Gross amounts not offset in the Balance Sheet (b)	(9		)	—		(7		)	—		—		—
Net energy-related derivative liabilities	$	192		$	53	$	20		$	72	$	45	$	4
Interest rate derivatives:
Interest rate derivatives presented in the Balance Sheet (a)	$	24		$	8	$	14		$	—	$	—	$	—
Gross amounts not offset in the Balance Sheet (b)	(8		)	—		(6		)	—		—		—
Net interest rate derivative liabilities	$	16		$	8	$	8		$	—	$	—	$	—

(a) None of the registrants offsets fair value amounts for multiple derivative instruments executed with the same counterparty on the balance sheets; therefore, gross and net amounts of derivative assets and liabilities presented on the balance sheets are the same.

(b) Includes gross amounts subject to netting terms that are not offset on the balance sheets and any cash/financial collateral pledged or received.

Pre-tax effects of unrealized derivative gains (losses) arising from energy-related derivative instruments

At June 30, 2015 and December 31, 2014, the pre-tax effects of unrealized derivative gains (losses) arising from energy-related derivative instruments designated as regulatory hedging instruments and deferred were as follows:

Regulatory Hedge Unrealized Gain (Loss) Recognized on the Balance Sheet at June 30, 2015
Derivative Category and Balance Sheet Location	Southern Company			Alabama Power			Georgia Power			Gulf Power			Mississippi Power
	(in millions)
Energy-related derivatives:
Other regulatory assets, current	$	(99	)	$	(31	)	$	(15	)	$	(32	)	$	(21	)
Other regulatory assets, deferred	(81		)	(17		)	(2		)	(42		)	(20		)
Other regulatory liabilities, current (a)	5			2			3			—			—
Other regulatory liabilities, deferred (b)	—			—			—			—			—
Total energy-related derivative gains (losses)	$	(175	)	$	(46	)	$	(14	)	$	(74	)	$	(41	)

(a) Southern Company, Alabama Power, and Georgia Power include other regulatory liabilities, current in other current liabilities.

(b) Georgia Power includes other regulatory liabilities, deferred in other deferred credits and liabilities.

Regulatory Hedge Unrealized Gain (Loss) Recognized on the Balance Sheet at December 31, 2014
Derivative Category and Balance Sheet Location	Southern Company			Alabama Power			Georgia Power			Gulf Power			Mississippi Power
	(in millions)
Energy-related derivatives:
Other regulatory assets, current	$	(118	)	$	(32	)	$	(23	)	$	(37	)	$	(26	)
Other regulatory assets, deferred	(79		)	(21		)	(4		)	(35		)	(19		)
Other regulatory liabilities, current (a)	7			1			6			—			—
Other regulatory liabilities, deferred (b)	—			—			1			—			—
Total energy-related derivative gains (losses)	$	(190	)	$	(52	)	$	(20	)	$	(72	)	$	(45	)

(a) Southern Company, Alabama Power, and Georgia Power include other regulatory liabilities, current in other current liabilities.

(b) Georgia Power includes other regulatory liabilities, deferred in other deferred credits and liabilities.

Pre-tax effects of interest rate derivatives

For the three months ended June 30, 2015 and 2014, the pre-tax effects of interest rate derivatives designated as cash flow hedging instruments on the statements of income were as follows:

Derivatives in Cash Flow Hedging Relationships	Gain (Loss) Recognized in OCI on Derivative (Effective Portion)				Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
					Statements of Income Location	Amount
	2015		2014			2015			2014
	(in millions)					(in millions)
Southern Company
Interest rate derivatives	$	31	$	—	Interest expense, net of amounts capitalized	$	(2	)	$	(2	)
Alabama Power
Interest rate derivatives	$	7	$	—	Interest expense, net of amounts capitalized	$	(1	)	$	—
Georgia Power
Interest rate derivatives	$	24	$	—	Interest expense, net of amounts capitalized	$	(1	)	$	—
Mississippi Power
Interest rate derivatives	$	—	$	—	Interest expense, net of amounts capitalized	$	—		$	(1	)
Southern Power
Interest rate derivatives	$	—	$	—	Interest expense, net of amounts capitalized	$	—		$	(1	)