Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2018

Assets and Liabilities Measured at Fair Value on a Recurring Basis

As of June 30, 2018, assets and liabilities measured at fair value on a recurring basis during the period, together with their associated level of the fair value hierarchy, were as follows:



	Fair Value Measurements Using:
As of June 30, 2018:	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Net Asset Value as a Practical Expedient (NAV)		Total
	(in millions)
Southern Company
Assets:
Energy-related derivatives^(a)(b)	$	287	$	166	$	—	$	—	$	453
Foreign currency derivatives	—		132		—		—		132
Nuclear decommissioning trusts^(c)	798		998		—		33		1,829
Cash equivalents	1,449		—		—		—		1,449
Other investments	9		—		1		—		10
Total	$	2,543	$	1,296	$	1	$	33	$	3,873
Liabilities:
Energy-related derivatives^(a)(b)	$	422	$	151	$	—	$	—	$	573
Interest rate derivatives	—		68		—		—		68
Foreign currency derivatives	—		23		—		—		23
Contingent consideration	—		—		22		—		22
Total	$	422	$	242	$	22	$	—	$	686

Alabama Power
Assets:
Energy-related derivatives	$	—	$	8	$	—	$	—	$	8
Nuclear decommissioning trusts:^(d)
Domestic equity	440		86		—		—		526
Foreign equity	61		55		—		—		116
U.S. Treasury and government agency securities	—		18		—		—		18
Corporate bonds	28		158		—		—		186
Mortgage and asset backed securities	—		18		—		—		18
Private equity	—		—		—		33		33
Other	7		—		—		—		7
Cash equivalents	495		—		—		—		495
Total	$	1,031	$	343	$	—	$	33	$	1,407
Liabilities:
Energy-related derivatives	$	—	$	9	$	—	$	—	$	9



	Fair Value Measurements Using:
As of June 30, 2018:	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Net Asset Value as a Practical Expedient (NAV)		Total
	(in millions)
Georgia Power
Assets:
Energy-related derivatives	$	—	$	7	$	—	$	—	$	7
Nuclear decommissioning trusts:^{(d) (e)}
Domestic equity	242		1		—		—		243
Foreign equity	—		135		—		—		135
U.S. Treasury and government agency securities	—		239		—		—		239
Municipal bonds	—		78		—		—		78
Corporate bonds	—		164		—		—		164
Mortgage and asset backed securities	—		41		—		—		41
Other	19		5		—		—		24
Total	$	261	$	670	$	—	$	—	$	931
Liabilities:
Energy-related derivatives	$	—	$	19	$	—	$	—	$	19
Interest rate derivatives	—		6		—		—		6
Total	$	—	$	25	$	—	$	—	$	25

Gulf Power
Assets:
Cash equivalents	$	27	$	—	$	—	$	—	$	27
Liabilities:
Energy-related derivatives	$	—	$	12	$	—	$	—	$	12

Mississippi Power
Assets:
Energy-related derivatives	$	—	$	3	$	—	$	—	$	3
Cash equivalents	205		—		—		—		205
Total	$	205	$	3	$	—	$	—	$	208
Liabilities:
Energy-related derivatives	$	—	$	9	$	—	$	—	$	9



	Fair Value Measurements Using:
As of June 30, 2018:	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Net Asset Value as a Practical Expedient (NAV)		Total
	(in millions)
Southern Power
Assets:
Energy-related derivatives	$	—	$	3	$	—	$	—	$	3
Foreign currency derivatives	—		132		—		—		132
Total	$	—	$	135	$	—	$	—	$	135
Liabilities:
Energy-related derivatives	$	—	$	3	$	—	$	—	$	3
Foreign currency derivatives	—		23		—		—		23
Contingent consideration	—		—		22		—		22
Total	$	—	$	26	$	22	$	—	$	48

Southern Company Gas
Assets:
Energy-related derivatives^(a)(b)	$	287	$	144	$	—	$	—	$	431
Cash equivalents	1		—		—		—		1
Total	$	288	$	144	$	—	$	—	$	432
Liabilities:
Energy-related derivatives^(a)(b)	$	422	$	99	$	—	$	—	$	521


(a)	Excludes $3 million associated with premiums and certain weather derivatives accounted for based on intrinsic value rather than fair value.


(b)	Excludes cash collateral of $183 million.


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


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


(e)	Includes the investment securities pledged to creditors and collateral received and excludes payables related to the securities lending program. As of June 30, 2018, approximately $63 million of the fair market value of Georgia Power's nuclear decommissioning trust funds' securities were on loan to creditors under the funds' managers' securities lending program.

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

As of June 30, 2018, the fair value measurements of private equity investments held in the nuclear decommissioning trusts that are calculated at net asset value per share (or its equivalent) as a practical expedient, as well as the nature and risks of those investments, were as follows:



As of June 30, 2018:	Fair Value		Unfunded Commitments		Redemption Frequency	Redemption Notice Period
	(in millions)
Southern Company	$	33	$	33	Not Applicable	Not Applicable
Alabama Power	$	33	$	33	Not Applicable	Not Applicable

Financial Instruments for Which Carrying Amount Did Not Equal Fair Value

As of June 30, 2018, other financial instruments for which the carrying amount did not equal fair value were as follows:



	Carrying Amount		Fair Value
	(in millions)
Long-term debt, including securities due within one year:
Southern Company	$	45,806	$	46,481
Alabama Power	8,119		8,435
Georgia Power	10,294		10,499
Gulf Power	1,285		1,311
Mississippi Power	1,779		1,760
Southern Power	5,037		5,094
Southern Company Gas	5,823		5,957