The Southern Company
Southern Company is a U.S. electric and gas utility holding company with regulated electric utilities in Alabama, Georgia, and Mississippi, a wholesale power business, and a natural gas distribution business across several Southeastern and Midwestern states. Through its subsidiaries, it also owns energy infrastructure and service businesses including nuclear operations support, wireless communications, distributed energy solutions, and gas pipeline and marketing activities.
Fiscal year 2025 · change from previous year
Development 2020–2025
Business
Share of revenueVertically integrated electric service to retail and wholesale customers in the Southeast.
Owned generation assets and market-based electricity sales, including PPAs.
Local gas utility distribution, storage, and related services.
Distributed energy, microgrids, nuclear support, telecom, and other services.
Customers
Southern Company serves regulated retail utility customers, including households, businesses, and industrial users in its electric and gas service territories. It also sells power to wholesale counterparties and load-serving entities through long-term contracts, and provides energy services to commercial, industrial, governmental, and utility customers through subsidiaries such as PowerSecure. Gas utility customers are primarily residential, commercial, and industrial end users within exclusive franchise territories.
Households and businesses in Alabama, Georgia, and Mississippi buying regulated electric service.
Load-serving entities and other buyers purchasing contracted generation from Southern Power.
Residential, commercial, and industrial customers served by gas distribution utilities in four states.
Customers buying distributed energy, microgrids, or backup/resilience solutions from PowerSecure.
Governmental and utility buyers of resilience, microgrid, and energy infrastructure solutions.
Strategy
Southern Company’s strategy centers on regulated utility investment, grid and gas infrastructure buildout, and long-duration contracted generation. It also uses its wholesale power platform and energy-services subsidiaries to add contracted growth opportunities, while maintaining access to capital for large, multi-year projects.
Rate-based utility assets provide the core earnings base and support long-lived capital deployment.
Long-term PPAs reduce merchant exposure and support predictable asset utilization.
Microgrids and backup power broaden the customer base beyond traditional utilities.
Large utility and generation projects require sustained external financing.
Geography
Southern Company’s core operations are concentrated in the U.S. Southeast, where its electric utilities serve Alabama, Georgia, and Mississippi and its wholesale power assets are largely tied to the same region. Southern Company Gas operates in Illinois, Georgia, Virginia, and Tennessee, while Southern Linc’s wireless network covers much of the Southeast. The company’s business is therefore shaped by state regulation, regional load growth, weather, and infrastructure needs across these service territories.
Risks
Southern Company is exposed to heavy regulation, rate oversight, and permitting requirements, which can affect cost recovery and project timing. Its operations also depend on large construction programs, fuel and supply chains, cyber protection, and weather-sensitive demand, while the gas business faces electrification and appliance-fuel substitution risk.
- Utility regulation and rate recovery riskImpact: HighLikelihood: High
Earnings depend on approvals from state and federal regulators and timely cost recovery.
Exposure: Electric and gas utilities
- Construction and capital project execution riskImpact: HighLikelihood: High
Large generation and grid projects can face delays, cost overruns, and permitting issues.
Exposure - Supply chain, inflation, and interest rate riskImpact: HighLikelihood: High
Equipment shortages and higher financing costs can increase project costs and timing uncertainty.
Exposure: Utility construction and maintenance programs
- Cybersecurity and critical infrastructure riskImpact: HighLikelihood: Low
Operational disruption could impair service delivery and create regulatory and reputational damage.
Exposure - Gas demand substitution riskImpact: MediumLikelihood: Low
Electrification policies, appliance bans, and alternative fuels can reduce long-term gas usage.
Exposure: Southern Company Gas
Accounting
Judgemental itemsUtility costs may be deferred and recovered through rates rather than expensed immediately.
Impact: Affects earnings timing, balance sheet assets/liabilities, and cash flow comparability
Large capital projects are capitalized during construction and can include allowance for funds used during construction.
Impact: Influences reported assets, interest capitalization, and future depreciation
Nuclear, generation, and utility assets carry long-dated decommissioning and remediation estimates.
Impact: Affects liabilities, expense recognition, and estimate sensitivity
Southern Power’s capacity and energy revenues are driven by contract terms and market-linked components.
Impact: Affects revenue mix, seasonality, and comparability across periods
Tax credits and deferred tax balances can change with project mix and utilization assumptions.
Impact: Affects effective tax rate and equity/deferred tax balances
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Last updated: 24/09/2026