Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2021

Schedule of Assets and Liabilities Measured at Fair Value

As of March 31, 2021, 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 March 31, 2021:	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)	$	372	$	179	$	34	$	—	$	585
Interest rate derivatives	—		10		—		—		10
Foreign currency derivatives	—		41		—		—		41
Investments in trusts:(b)(c)
Domestic equity	782		214		—		—		996
Foreign equity	145		197		—		—		342
U.S. Treasury and government agency securities	—		325		—		—		325
Municipal bonds	—		45		—		—		45
Pooled funds – fixed income	—		18		—		—		18
Corporate bonds	5		436		—		—		441
Mortgage and asset backed securities	—		81		—		—		81
Private equity	—		—		—		83		83

Other	50		7		—		—		57
Cash equivalents	1,121		11		—		—		1,132
Other investments	9		33		—		—		42
Total	$	2,484	$	1,597	$	34	$	83	$	4,198
Liabilities:
Energy-related derivatives(a)	$	359	$	158	$	6	$	—	$	523

Foreign currency derivatives	—		23		—		—		23
Contingent consideration	—		—		16		—		16
Total	$	359	$	181	$	22	$	—	$	562


	Fair Value Measurements Using:
As of March 31, 2021:	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)
Alabama Power
Assets:
Energy-related derivatives	$	—	$	12	$	—	$	—	$	12
Nuclear decommissioning trusts:(b)
Domestic equity	448		205		—		—		653
Foreign equity	145		15		—		—		160
U.S. Treasury and government agency securities	—		20		—		—		20
Municipal bonds	—		1		—		—		1
Corporate bonds	5		235		—		—		240
Mortgage and asset backed securities	—		26		—		—		26
Private equity	—		—		—		83		83
Other	27		—		—		—		27
Cash equivalents	401		11		—		—		412
Other investments	—		33		—		—		33
Total	$	1,026	$	558	$	—	$	83	$	1,667
Liabilities:
Energy-related derivatives	$	—	$	4	$	—	$	—	$	4



Georgia Power
Assets:
Energy-related derivatives	$	—	$	17	$	—	$	—	$	17

Nuclear decommissioning trusts:(b)(c)
Domestic equity	334		1		—		—		335
Foreign equity	—		179		—		—		179
U.S. Treasury and government agency securities	—		305		—		—		305
Municipal bonds	—		44		—		—		44
Corporate bonds	—		201		—		—		201
Mortgage and asset backed securities	—		55		—		—		55
Other	23		7		—		—		30

Total	$	357	$	809	$	—	$	—	$	1,166
Liabilities:
Energy-related derivatives	$	—	$	8	$	—	$	—	$	8


	Fair Value Measurements Using:
As of March 31, 2021:	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)
Mississippi Power
Assets:
Energy-related derivatives	$	—	$	11	$	—	$	—	$	11



Liabilities:
Energy-related derivatives	$	—	$	6	$	—	$	—	$	6



Southern Power
Assets:
Energy-related derivatives	$	—	$	1	$	—	$	—	$	1
Foreign currency derivatives	—		41		—		—		41
Cash equivalents	115		—		—		—		115
Total	$	115	$	42	$	—	$	—	$	157
Liabilities:
Energy-related derivatives	$	—	$	1	$	—	$	—	$	1
Foreign currency derivatives	—		23		—		—		23
Contingent consideration	—		—		16		—		16
Total	$	—	$	24	$	16	$	—	$	40

Southern Company Gas
Assets:
Energy-related derivatives(a)	$	372	$	138	$	34	$	—	$	544

Non-qualified deferred compensation trusts:
Domestic equity	—		8		—		—		8
Foreign equity	—		3		—		—		3
Pooled funds – fixed income	—		18		—		—		18

Cash equivalents and restricted cash	284		—		—		—		284

Total	$	656	$	167	$	34	$	—	$	857
Liabilities:
Energy-related derivatives(a)	$	359	$	139	$	6	$	—	$	504

(a)Excludes cash collateral of $27 million.

(b)Excludes receivables related to investment income, pending investment sales, payables related to pending investment purchases, and currencies. See Note 6 to the financial statements in Item 8 of the Form 10-K for additional information.

(c)Includes investment securities pledged to creditors and collateral received and excludes payables related to the securities lending program. As of March 31, 2021, approximately $34 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. See Note 6 to the financial statements in Item 8 of the Form 10-K for additional information.

Schedule of Increase (Decrease) In Fair Value Of Funds

The fair value of the funds, including reinvested interest and dividends and excluding the funds' expenses, increased (decreased) by the amounts shown in the table below for the three months ended March 31, 2021 and 2020. The changes were recorded as a change to the regulatory assets and liabilities related to AROs for Georgia Power and Alabama Power, respectively.


Fair value increases (decreases)	Three Months Ended March 31, 2021		Three Months Ended March 31, 2020
	(in millions)
Southern Company	$	39	$	(247)
Alabama Power	41		(167)
Georgia Power	(2)		(80)

Schedule of Financial Instruments for which Carrying Amount Did Not Equal Fair Value

At March 31, 2021, other financial instruments for which the carrying amount did not equal fair value were as follows:


	Southern Company		Alabama Power		Georgia Power		Mississippi Power		Southern Power		Southern Company Gas(*)
	(in millions)
Long-term debt, including securities due within one year:
Carrying amount	$	50,035	$	8,866	$	13,220	$	1,398	$	4,030	$	6,588
Fair value	54,113		9,821		14,291		1,507		4,347		7,264

(*)The long-term debt of Southern Company Gas is recorded at amortized cost, including the fair value adjustments at the effective date of the 2016 merger with Southern Company. Southern Company Gas amortizes the fair value adjustments over the remaining lives of the respective bonds, the latest being through 2043.

Schedule of Fair Value of Commodity Derivative Contracts that Include a Significant Unobservable Component

The following table includes transfers to Level 3, which represent the fair value of Southern Company Gas' commodity derivative contracts that include a significant unobservable component for the first time during the period.


	Three Months Ended March 31, 2021
	(in millions)
Beginning balance	$	28


Instruments realized or otherwise settled during period	(2)
Changes in fair value	2
Ending balance	$	28