Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2022

Schedule of Assets and Liabilities Measured at Fair Value

At September 30, 2022, 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:
At September 30, 2022	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)	$	49	$	454	$	—	$	—	$	503


Investments in trusts:(b)(c)
Domestic equity	610		161		—		—		771
Foreign equity	111		129		—		—		240
U.S. Treasury and government agency securities	—		265		—		—		265
Municipal bonds	—		52		—		—		52
Pooled funds – fixed income	—		7		—		—		7
Corporate bonds	—		438		—		—		438
Mortgage and asset backed securities	—		87		—		—		87
Private equity	—		—		—		156		156
Cash and cash equivalents	4		—		—		—		4
Other	17		13		—		—		30
Cash equivalents	1,402		18		—		—		1,420
Other investments	9		26		—		—		35
Total	$	2,202	$	1,650	$	—	$	156	$	4,008
Liabilities:
Energy-related derivatives(a)	$	20	$	141	$	—	$	—	$	161
Interest rate derivatives	—		311		—		—		311
Foreign currency derivatives	—		323		—		—		323
Contingent consideration	—		—		14		—		14
Other	—		13		—		—		13
Total	$	20	$	788	$	14	$	—	$	822


	Fair Value Measurements Using:
At September 30, 2022	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	$	—	$	147	$	—	$	—	$	147

Nuclear decommissioning trusts:(b)
Domestic equity	370		152		—		—		522
Foreign equity	111		—		—		—		111
U.S. Treasury and government agency securities	—		15		—		—		15
Municipal bonds	—		2		—		—		2
Corporate bonds	—		230		—		—		230
Mortgage and asset backed securities	—		20		—		—		20
Private equity	—		—		—		156		156
Other	10		—		—		—		10
Cash equivalents	1,225		18		—		—		1,243
Other investments	—		26		—		—		26
Total	$	1,716	$	610	$	—	$	156	$	2,482
Liabilities:
Energy-related derivatives	$	—	$	35	$	—	$	—	$	35



Georgia Power
Assets:
Energy-related derivatives	$	—	$	145	$	—	$	—	$	145

Nuclear decommissioning trusts:(b)(c)
Domestic equity	240		1		—		—		241
Foreign equity	—		128		—		—		128
U.S. Treasury and government agency securities	—		250		—		—		250
Municipal bonds	—		50		—		—		50
Corporate bonds	—		208		—		—		208
Mortgage and asset backed securities	—		67		—		—		67
Other	7		13		—		—		20

Total	$	247	$	862	$	—	$	—	$	1,109
Liabilities:
Energy-related derivatives	$	—	$	51	$	—	$	—	$	51


	Fair Value Measurements Using:
At September 30, 2022	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	$	—	$	133	$	—	$	—	$	133

Cash equivalents	30		—		—		—		30
Total	$	30	$	133	$	—	$	—	$	163
Liabilities:
Energy-related derivatives	$	—	$	24	$	—	$	—	$	24



Southern Power
Assets:
Energy-related derivatives	$	—	$	7	$	—	$	—	$	7



Liabilities:
Energy-related derivatives	$	—	$	13	$	—	$	—	$	13
Foreign currency derivatives	—		80		—		—		80
Contingent consideration	—		—		14		—		14
Other	—		13		—		—		13
Total	$	—	$	106	$	14	$	—	$	120

Southern Company Gas
Assets:
Energy-related derivatives(a)	$	49	$	22	$	—	$	—	$	71

Non-qualified deferred compensation trusts:
Domestic equity	—		8		—		—		8
Foreign equity	—		1		—		—		1
Pooled funds – fixed income	—		7		—		—		7
Cash equivalents	4		—		—		—		4


Total	$	53	$	38	$	—	$	—	$	91
Liabilities:
Energy-related derivatives(a)	$	20	$	17	$	—	$	—	$	37
Interest rate derivatives	—		87		—		—		87

Total	$	20	$	104	$	—	$	—	$	124

(a)Excludes cash collateral of $15 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. At September 30, 2022, approximately $46 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 and nine months ended September 30, 2022 and 2021. 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 September 30, 2022		Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		Nine Months Ended September 30, 2021
	(in millions)
Southern Company	$	(106)	$	9	$	(486)	$	173
Alabama Power	(53)		15		(245)		133
Georgia Power	(53)		(6)		(241)		40

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

At September 30, 2022, 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 billions)
Long-term debt, including securities due within one year:
Carrying amount	$	53.4	$	10.8	$	14.5	$	1.5	$	2.9	$	7.4
Fair value	46.4		9.3		12.6		1.2		2.7		6.3

(*)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.