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Revenue from Contracts with Customers and Lease Income
 3 Months Ended
Mar. 31, 2024
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers and Lease Income REVENUE FROM CONTRACTS WITH CUSTOMERS AND LEASE INCOME
Revenue from Contracts with Customers
The Registrants generate revenues from a variety of sources, some of which are not accounted for as revenue from contracts with customers, such as leases, derivatives, and certain cost recovery mechanisms. Included in the wholesale electric revenues of the traditional electric operating companies and Southern Power are revenues associated with affiliate transactions. These revenues are generated through long-term PPAs or short-term energy sales made in accordance with the IIC, as approved by the FERC. Amounts related to these affiliate revenues are eliminated in consolidation for Southern Company. See Note 1 to the financial statements under "Revenues" and "Affiliate Transactions" in Item 8 of the Form 10-K for additional information. See "Lease Income" herein and Note (J) for additional information on revenue accounted for under lease and derivative accounting guidance, respectively.
The following table disaggregates revenue from contracts with customers for the three months ended March 31, 2024 and 2023:
Southern CompanyAlabama PowerGeorgia PowerMississippi PowerSouthern PowerSouthern Company Gas
(in millions)
Three Months Ended March 31, 2024
Operating revenues
Retail electric revenues
Residential$1,852 $765 $1,016 $71 $— $— 
Commercial1,471 468 932 71 — — 
Industrial871 410 383 78 — — 
Other30 3 25 2 — — 
Total retail electric revenues4,224 1,646 2,356 222 — — 
Natural gas distribution revenues
Residential745 — — — — 745 
Commercial176 — — — — 176 
Transportation361 — — — — 361 
Industrial 16 — — — — 16 
Other113 — — — — 113 
Total natural gas distribution revenues1,411 — — — — 1,411 
Wholesale electric revenues
PPA energy revenues272 57 18 1 202 — 
PPA capacity revenues153 24 32 16 97 — 
Non-PPA revenues58 41 — 93 58 — 
Total wholesale electric revenues483 122 50 110 357 — 
Other natural gas revenues
Gas marketing services233 — — — — 233 
Other natural gas revenues5 — — — — 5 
Total natural gas revenues238 — — — — 238 
Other revenues326 52 151 11 12 — 
Total revenue from contracts with customers6,682 1,820 2,557 343 369 1,649 
Other revenue sources(*)
(36)(29)(159)(1)104 58 
Total operating revenues$6,646 $1,791 $2,398 $342 $473 $1,707 
Southern CompanyAlabama PowerGeorgia PowerMississippi PowerSouthern PowerSouthern Company Gas
(in millions)
Three Months Ended March 31, 2023
Operating revenues
Retail electric revenues
Residential$1,525 $659 $801 $65 $— $— 
Commercial1,251 430 753 68 — — 
Industrial789 398 313 78 — — 
Other27 3 22 2 — — 
Total retail electric revenues3,592 1,490 1,889 213 — — 
Natural gas distribution revenues
Residential896 — — — — 896 
Commercial232 — — — — 232 
Transportation319 — — — — 319 
Industrial 23 — — — — 23 
Other117 — — — — 117 
Total natural gas distribution revenues1,587 — — — — 1,587 
Wholesale electric revenues
PPA energy revenues284 72 12 4 202 — 
PPA capacity revenues190 60 11 32 89 — 
Non-PPA revenues36 20 3 107 103 — 
Total wholesale electric revenues510 152 26 143 394 — 
Other natural gas revenues
Gas marketing services231 — — — — 231 
Other natural gas revenues11 — — — — 11 
Total natural gas revenues242 — — — — 242 
Other revenues310 54 132 11 11 — 
Total revenue from contracts with customers6,241 1,696 2,047 367 405 1,829 
Other revenue sources(*)
239 (49)129 23 103 46 
Total operating revenues$6,480 $1,647 $2,176 $390 $508 $1,875 
(*)Other revenue sources relate to revenues from customers accounted for as derivatives and leases, alternative revenue programs at Southern Company Gas, and cost recovery mechanisms and revenues (including those related to fuel costs) that meet other scope exceptions for revenues from contracts with customers at the traditional electric operating companies.
Contract Balances
The following table reflects the closing balances of receivables, contract assets, and contract liabilities related to revenues from contracts with customers at March 31, 2024 and December 31, 2023:
Southern CompanyAlabama PowerGeorgia PowerMississippi PowerSouthern PowerSouthern Company Gas
(in millions)
Accounts Receivable
At March 31, 2024$2,793 $737 $986 $80 $80 $699 
At December 31, 20232,820 821 1,011 90 122 684 
Contract Assets
At March 31, 2024$290 $3 $119 $— $— $59 
At December 31, 2023271 2 121 — — 56 
Contract Liabilities
At March 31, 2024$207 $— $19 $— $1 $— 
At December 31, 2023116 — 1 — 4 — 
Contract assets for Georgia Power primarily relate to retail customer fixed bill programs, where the payment is contingent upon Georgia Power's continued performance and the customer's continued participation in the program over a one-year contract term, and unregulated service agreements, where payment is contingent on project completion. Contract liabilities for Georgia Power primarily relate to cash collections recognized in advance of revenue for unregulated service agreements. Southern Company Gas' contract assets relate to work performed on an energy efficiency enhancement and upgrade contract with the U.S. General Services Administration. Southern Company Gas receives cash advances from a third-party financial institution to fund work performed, of which approximately $65 million had been received at March 31, 2024. These advances have been accounted for as long-term debt on the balance sheets. See Note 1 to the financial statements under "Affiliate Transactions" in Item 8 of the Form 10-K for additional information regarding the construction contract. At March 31, 2024 and December 31, 2023, Southern Company's unregulated distributed generation business had contract assets of $108 million and $91 million, respectively, and contract liabilities of $188 million and $115 million, respectively, for outstanding performance obligations, all of which are expected to be satisfied within one year.
Revenues recognized in the three months ended March 31, 2024, which were included in contract liabilities at December 31, 2023, were $28 million for Southern Company and immaterial for the other Registrants. Contract liabilities are primarily classified as current on the balance sheets as the corresponding revenues are generally expected to be recognized within one year.
Remaining Performance Obligations
Southern Company's subsidiaries may enter into long-term contracts with customers in which revenues are recognized as performance obligations are satisfied over the contract term. For the traditional electric operating companies and Southern Power, these contracts primarily relate to PPAs whereby electricity and generation capacity are provided to a customer. The revenue recognized for the delivery of electricity is variable; however, certain PPAs include a fixed payment for fixed generation capacity over the term of the contract. For Southern Company Gas, these contracts primarily relate to the U.S. General Services Administration contract described above. Southern Company's unregulated distributed generation business also has partially satisfied performance
obligations related to certain fixed price contracts. Revenues from contracts with customers related to these performance obligations remaining at March 31, 2024 are expected to be recognized as follows:
2024 (remaining)2025202620272028Thereafter
(in millions)
Southern Company$882 $597 $343 $430 $325 $2,052 
Alabama Power18 9 — — — — 
Georgia Power58 50 18 17 17 17 
Mississippi Power(*)
45 63 66 69 73 — 
Southern Power(*)
284 301 299 306 297 2,041 
Southern Company Gas18 — — — — — 
(*)Includes performance obligations related to affiliate PPAs with Georgia Power. See Note 1 to the financial statements under "Affiliate Transactions" in Item 8 of the Form 10-K for additional information.
Lease Income
Lease income for the three months ended March 31, 2024 and 2023 is as follows:
Southern
Company		Alabama PowerGeorgia PowerMississippi
Power		Southern PowerSouthern Company Gas
 (in millions)
For the Three Months Ended March 31, 2024
Lease income - interest income on sales-type leases$5 $— $— $3 $2 $— 
Lease income - operating leases35 3 7 1 21 9 
Variable lease income72 — — — 79 — 
Total lease income$112 $3 $7 $4 $102 $9 
For the Three Months Ended March 31, 2023
Lease income - interest income on sales-type leases$6 $— $— $4 $2 $— 
Lease income - operating leases49 18 7 1 21 9 
Variable lease income69 — — — 75 — 
Total lease income$124 $18 $7 $5 $98 $9 
Lease payments received under tolling arrangements and PPAs consist of either scheduled payments or variable payments based on the amount of energy produced by the underlying electric generating units. Lease income related to PPAs for Alabama Power and Southern Power is included in wholesale revenues.