Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2016			2015			2014
	(in millions)
Federal —
Current	$	1,184		$	(177	)	$	175
Deferred	(342		)	1,266			695
	842			1,089			870
State —
Current	(108		)	(33		)	93
Deferred	217			138			14
	109			105			107
Total	$	951		$	1,194		$	977

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2016			2015
	(in millions)
Deferred tax liabilities —
Accelerated depreciation	$	15,392		$	12,767
Property basis differences	2,708			1,603
Leveraged lease basis differences	314			308
Employee benefit obligations	737			579
Premium on reacquired debt	89			95
Regulatory assets associated with employee benefit obligations	1,584			1,378
Regulatory assets associated with AROs	1,781			1,422
Other	907			793
Total	23,512			18,945
Deferred tax assets —
Federal effect of state deferred taxes	597			479
Employee benefit obligations	1,868			1,720
Over recovered fuel clause	66			104
Other property basis differences	401			695
Deferred costs	100			83
ITC carryforward	1,974			770
Federal NOL carryforward	1,084			38
Unbilled revenue	92			111
Other comprehensive losses	152			85
AROs	1,732			1,482
Estimated Loss on Kemper IGCC	484			451
Deferred state tax assets	266			222
Other	679			443
Total	9,495			6,683
Valuation allowance	(23		)	(4		)
Total deferred income taxes	14,040			12,266
Portion included in accumulated deferred tax assets	(52		)	(56		)
Accumulated deferred income taxes	$	14,092		$	12,322

Summary of operating loss carryforward

At December 31, 2016, the state NOL carryforwards for Southern Company's subsidiaries were as follows:

Jurisdiction	NOL Carryforwards		Net State Income Tax Benefit		Tax Year NOL Begins Expiring
	(in millions)
Mississippi	$	3,448	$	112	2032
Oklahoma	839		31		2036
Georgia	685		25		2019
New York	229		11		2036
New York City	209		12		2036
Florida	198		7		2034
Other states	146		5		Various
Total	$	5,754	$	203

Schedule of effective income tax reconciliation

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2016		2015		2014
Federal statutory rate	35.0	%	35.0	%	35.0	%
State income tax, net of federal deduction	2.1		1.9		2.3
Employee stock plans dividend deduction	(1.2	)	(1.2	)	(1.4	)
Non-deductible book depreciation	0.9		1.2		1.4
AFUDC-Equity	(2.0	)	(2.2	)	(2.9	)
ITC basis difference	(5.0	)	(1.5	)	(1.6	)
Federal PTCs	(1.2	)	—		—
Amortization of ITC	(0.9	)	(0.5	)	(0.5	)
Other	(0.4	)	0.2		0.2
Effective income tax rate	27.3	%	32.9	%	32.5	%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2016			2015			2014
	(in millions)
Unrecognized tax benefits at beginning of year	$	433		$	170		$	7
Tax positions increase from current periods	45			43			64
Tax positions increase from prior periods	21			240			102
Tax positions decrease from prior periods	(15		)	(20		)	(3		)
Balance at end of year	$	484		$	433		$	170

Impact on effective tax rate

The impact on Southern Company's effective tax rate, if recognized, is as follows:

	2016		2015		2014
	(in millions)
Tax positions impacting the effective tax rate	$	20	$	10	$	10
Tax positions not impacting the effective tax rate	464		423		160
Balance of unrecognized tax benefits	$	484	$	433	$	170

Alabama Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2016		2015		2014
	(in millions)
Federal —
Current	$	103	$	110	$	198
Deferred	339		320		225
	442		430		423
State —
Current	20		8		44
Deferred	69		68		45
	89		76		89
Total	$	531	$	506	$	512

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2016		2015
	(in millions)
Deferred tax liabilities —
Accelerated depreciation	$	4,307	$	3,917
Property basis differences	456		456
Premium on reacquired debt	26		28
Employee benefit obligations	201		200
Regulatory assets associated with employee benefit obligations	393		375
Asset retirement obligations	289		289
Regulatory assets associated with asset retirement obligations	347		312
Other	179		175
Total	6,198		5,752
Deferred tax assets —
Federal effect of state deferred taxes	266		242
Unbilled fuel revenue	36		39
Storm reserve	21		23
Employee benefit obligations	427		407
Other comprehensive losses	19		20
Asset retirement obligations	636		600
Other	139		180
Total	1,544		1,511
Accumulated deferred income taxes, net	$	4,654	$	4,241

Schedule of effective income tax reconciliation

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2016	2015	2014
Federal statutory rate	35.0%	35.0%	35.0%
State income tax, net of federal deduction	4.2	3.8	4.4
Non-deductible book depreciation	1.0	1.2	1.1
AFUDC equity	(0.7)	(1.6)	(1.3)
Other	(0.7)	—	(0.2)
Effective income tax rate	38.8%	38.4%	39.0%

Georgia Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2016		2015			2014
	(in millions)
Federal –
Current	$	391	$	515		$	295
Deferred	319		176			366
	710		691			661
State –
Current	6		81			82
Deferred	64		(3		)	(14		)
	70		78			68
Total	$	780	$	769		$	729

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2016		2015
	(in millions)
Deferred tax liabilities –
Accelerated depreciation	$	5,266	$	4,909
Property basis differences	957		1,003
Employee benefit obligations	428		310
Premium on reacquired debt	56		61
Regulatory assets –
Storm damage reserves	83		37
Employee benefit obligations	546		528
Asset retirement obligations	726		545
Retired assets	55		58
Asset retirement obligations	182		161
Other	83		92
Total	8,382		7,704
Deferred tax assets –
Federal effect of state deferred taxes	173		150
Employee benefit obligations	661		642
Other property basis differences	105		88
Other deferred costs	100		83
State investment tax credit carryforward	201		216
Federal tax credit carryforward	84		3
Unbilled fuel revenue	47		47
Regulatory liabilities associated with asset retirement obligations	33		60
Asset retirement obligations	908		706
Other	70		82
Total	2,382		2,077
Accumulated deferred income taxes	$	6,000	$	5,627

Schedule of effective income tax reconciliation

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2016		2015		2014
Federal statutory rate	35.0	%	35.0	%	35.0	%
State income tax, net of federal deduction	2.1		2.5		2.2
Non-deductible book depreciation	0.8		1.2		1.3
AFUDC equity	(0.8	)	(0.7	)	(0.8	)
Other	(0.4	)	(0.4	)	(0.7	)
Effective income tax rate	36.7	%	37.6	%	37.0	%

Gulf Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2016		2015			2014
	(in millions)
Federal -
Current	$	34	$	(3	)	$	23
Deferred	45		80			52
	79		77			75
State -
Current	—		5			—
Deferred	12		10			13
	12		15			13
Total	$	91	$	92		$	88

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2016		2015
	(in millions)
Deferred tax liabilities-
Accelerated depreciation	$	834	$	812
Property basis differences	123		133
Pension and other employee benefits	58		39
Regulatory assets	45		16
Regulatory assets associated with employee benefit obligations	65		59
Regulatory assets associated with asset retirement obligations	55		40
Other	12		10
Total	1,192		1,109
Deferred tax assets-
Federal effect of state deferred taxes	37		33
Postretirement benefits	26		26
Pension and other employee benefits	72		65
Property reserve	17		15
Asset retirement obligations	55		40
Alternative minimum tax carryforward	18		18
Other	19		19
Total	244		216
Accumulated deferred income taxes	$	948	$	893

Schedule of effective income tax reconciliation

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2016	2015	2014
Federal statutory rate	35.0%	35.0%	35.0%
State income tax, net of federal deduction	3.4	3.9	3.5
Non-deductible book depreciation	0.6	0.5	0.4
Differences in prior years' deferred and current tax rates	(0.1)	(0.1)	(0.1)
AFUDC equity	—	(1.8)	(1.8)
Other, net	0.6	(0.6)	0.1
Effective income tax rate	39.5%	36.9%	37.1%

Mississippi Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2016			2015			2014
	(in millions)
Federal —
Current	$	(31	)	$	(768	)	$	(431	)
Deferred	(60		)	704			183
	(91		)	(64		)	(248		)
State —
Current	(6		)	(81		)	1
Deferred	(7		)	73			(38		)
	(13		)	(8		)	(37		)
Total	$	(104	)	$	(72	)	$	(285	)

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2016		2015
	(in millions)
Deferred tax liabilities —
Accelerated depreciation	$	386	$	1,618
Property basis difference	852		—
Regulatory assets associated with AROs	72		71
Pensions and other benefits	49		30
Regulatory assets associated with employee benefit obligations	70		66
Regulatory assets associated with the Kemper IGCC	82		86
Rate differential	144		115
Other	125		176
Total	1,780		2,162
Deferred tax assets —
Fuel clause over recovered	26		51
Estimated loss on Kemper IGCC	484		451
Pension and other benefits	96		92
Federal NOL	109		17
Property insurance	27		25
Premium on long-term debt	14		18
AROs	72		71
Property basis difference	—		451
Deferred state tax assets	113		152
Deferred federal tax assets	31		31
Federal effect of state deferred taxes	19		8
Other	33		33
Total	1,024		1,400
Total deferred tax liabilities, net	756		762
Accumulated deferred income taxes	$	756	$	762

Schedule of effective income tax reconciliation

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2016		2015		2014
Federal statutory rate	(35.0	)%	(35.0	)%	(35.0	)%
State income tax, net of federal deduction	(5.7	)	(6.3	)	(4.0	)
Non-deductible book depreciation	0.7		1.3		0.1
AFUDC-equity	(28.5	)	(49.6	)	(7.8	)
Other	—		(2.9	)	0.1
Effective income tax rate (benefit rate)	(68.5	)%	(92.5	)%	(46.6	)%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2016		2015		2014
	(in millions)
Unrecognized tax benefits at beginning of year	$	421	$	165	$	4
Tax positions increase from current periods	26		32		58
Tax positions increase from prior periods	18		224		103
Balance at end of year	$	465	$	421	$	165

Impact on effective tax rate

The impact on the Company's effective tax rate, if recognized, is as follows:

	2016		2015			2014
	(in millions)
Tax positions impacting the effective tax rate	$	1	$	(2	)	$	4
Tax positions not impacting the effective tax rate	464		423			161
Balance of unrecognized tax benefits	$	465	$	421		$	165

Accrued interest for unrecognized tax benefits

Accrued interest for unrecognized tax benefits was as follows:

	2016		2015		2014
	(in millions)
Interest accrued at beginning of year	$	13	$	3	$	1
Interest accrued during the year	15		10		2
Balance at end of year	$	28	$	13	$	3

Southern Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2016			2015			2014
	(in millions)
Federal —
Current (*)	$	928		$	12		$	179
Deferred (*)	(1,098		)	10			(166		)
	(170		)	22			13
State —
Current	(60		)	(32		)	(14		)
Deferred	35			31			(2		)
	(25		)	(1		)	(16		)
Total	$	(195	)	$	21		$	(3	)

(*) ITCs and PTCs generated in the current tax year and carried forward from prior tax years that cannot be utilized in the current tax year are reclassified from current to deferred taxes in federal income tax expense above. ITCs and PTCs reclassified in this manner include $1.13 billion for 2016, $246 million for 2015, and $305 million for 2014. These ITCs and PTCs are included in the following table of temporary differences as unrealized tax credits.

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2016			2015
Deferred tax liabilities —
Accelerated depreciation and other property basis differences	$	2,440		$	1,364
Levelized capacity revenues	28			22
Other	27			7
Total deferred income tax liabilities	2,495			1,393
Deferred tax assets —
Federal effect of state deferred taxes	53			40
Basis difference on ITCs	292			149
Alternative minimum tax carryforward	15			15
Unrealized tax credits	1,685			551
Federal net operating loss (NOL)	808			9
Deferred state tax assets	60			13
Other partnership basis differences	16			3
Other	8			14
Total deferred income tax assets	2,937			794
Valuation Allowance	—			(2		)
Net deferred income tax assets	2,937			792
Total deferred income tax asset (liability)	$	442		$	(601	)
Recognized in the consolidated balance sheets:
Accumulated deferred income taxes – assets	$	594		$	—
Accumulated deferred income taxes – liability	$	(152	)	$	(601	)

Summary of operating loss carryforward

The state NOL carryforwards by jurisdiction were as follows:

Jurisdiction	NOL Carryforwards		Net State Income Tax Benefit		Tax Year NOL Expires
	(in millions)
Oklahoma	$	838	$	32	2035
Florida	185		7		2033
Other states	7		1		2029 through 2035
Balance at year end	$	1,030	$	40

Schedule of effective income tax reconciliation

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2016		2015		2014
Federal statutory rate	35.0	%	35.0	%	35.0	%
State income tax, net of federal deduction	(9.1	)	(0.3	)	(6.0	)
Amortization of ITC	(20.6	)	(5.0	)	(4.3	)
ITC basis difference	(89.0	)	(21.5	)	(27.7	)
Production tax credits	(23.3	)	(0.6	)	—
Noncontrolling interests	(6.2	)	(1.7	)	(0.3	)
Other	4.6		2.5		1.4
Effective income tax rate (benefit)	(108.6	)%	8.4	%	(1.9	)%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2016			2015			2014
	(in millions)
Balance at beginning of year	$	8		$	5		$	2
Tax positions increase from current periods	17			9			5
Tax positions decrease from prior periods	(8		)	(6		)	(2		)
Balance at end of year	$	17		$	8		$	5

Southern Company Gas [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions for the successor period of July 1, 2016 through December 31, 2016 and the predecessor periods of January 1, 2016 through June 30, 2016 and the years ended December 31, 2015 and 2014 are as follows:

	Successor			Predecessor
	July 1, 2016 through December 31,			January 1, 2016 through June 30,		Years Ended December 31,
	2016			2016		2015			2014
	(in millions)			(in millions)
Federal —
Current	$	—		$	67	$	(13	)	$	111
Deferred	65			8		198			184
	65			75		185			295
State —
Current	(16		)	12		10			38
Deferred	27			—		18			17
	11			12		28			55
Total	$	76		$	87	$	213		$	350

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	Successor			Predecessor
	2016			2015
	(in millions)			(in millions)
Deferred tax liabilities —
Accelerated depreciation	$	1,954		$	1,820
Property basis differences	311			283
Regulatory assets associated with employee benefit obligations	125			44
Other	164			215
Total	2,554			2,362
Deferred tax assets —
Federal net operating loss	59			—
Federal effect of state deferred taxes	42			62
Employee benefit obligations	165			164
Other	332			212
Total	598			438
Less valuation allowances	(19		)	(19		)
Total, net of valuation allowances	579			419
Accumulated deferred income taxes, net	$	1,975		$	1,943

Schedule of effective income tax reconciliation

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	Successor	Predecessor
	July 1, 2016 through December 31,	January 1, 2016 through June 30,	Years Ended December 31,
	2016	2016	2015	2014
Federal statutory rate	35.0%	35.0%	35.0%	35.0%
State income tax, net of federal deduction	4.0	3.5	3.4	3.8
Other	1.0	(0.9)	(2.0)	(1.2)
Effective income tax rate	40.0%	37.6%	36.4%	37.6%