Fair Value Measurements

12 Months Ended

Dec. 31, 2014

Fair value measurements are based on inputs of observable and unobservable market data that a market participant would use in pricing the asset or liability. The use of observable inputs is maximized where available and the use of unobservable inputs is minimized for fair value measurement and reflects a three-tier fair value hierarchy that prioritizes inputs to valuation techniques used for fair value measurement.


•	Level 1 consists of observable market data in an active market for identical assets or liabilities.


•	Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.


•	Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.

In the case of multiple inputs being used in a fair value measurement, the lowest level input that is significant to the fair value measurement represents the level in the fair value hierarchy in which the fair value measurement is reported.

As of December 31, 2014, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2014:	(Level 1)		(Level 2)		(Level 3)		Total
	(in millions)
Assets:
Energy-related derivatives	$	—	$	13	$	—	$	13
Interest rate derivatives	—		8		—		8
Nuclear decommissioning trusts:^(a)
Domestic equity	583		85		—		668
Foreign equity	34		184		—		218
U.S. Treasury and government agency securities	—		130		—		130
Municipal bonds	—		62		—		62
Corporate bonds	—		299		—		299
Mortgage and asset backed securities	—		139		—		139
Other	11		13		3		27
Cash equivalents	397		—		—		397
Other investments	9		—		1		10
Total	$	1,034	$	933	$	4	$	1,971
Liabilities:
Energy-related derivatives	$	—	$	201	$	—	$	201
Interest rate derivatives	—		24		—		24
Total	$	—	$	225	$	—	$	225


(a)	Includes the investment securities pledged to creditors and collateral received, and excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases and the lending pool. See Note 1 under "Nuclear Decommissioning" for additional information.

As of December 31, 2013, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2013:	(Level 1)		(Level 2)		(Level 3)		Total
	(in millions)
Assets:
Energy-related derivatives	$	—	$	24	$	—	$	24
Interest rate derivatives	—		3		—		3
Nuclear decommissioning trusts:^(a)
Domestic equity	589		75		—		664
Foreign equity	35		196		—		231
U.S. Treasury and government agency securities	—		103		—		103
Municipal bonds	—		64		—		64
Corporate bonds	—		229		—		229
Mortgage and asset backed securities	—		132		—		132
Other	—		37		3		40
Cash equivalents	491		—		—		491
Other investments	9		—		4		13
Total	$	1,124	$	863	$	7	$	1,994
Liabilities:
Energy-related derivatives	$	—	$	56	$	—	$	56


(a)	Includes the investment securities pledged to creditors and collateral received, and excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases and the lending pool. See Note 1 under "Nuclear Decommissioning" for additional information.

Valuation Methodologies

The energy-related derivatives primarily consist of over-the-counter financial products for natural gas and physical power products, including, from time to time, basis swaps. These are standard products used within the energy industry and are valued using the market approach. The inputs used are mainly from observable market sources, such as forward natural gas prices, power prices, implied volatility, and overnight index swap interest rates. Interest rate derivatives are also standard over-the-counter financial products valued using the market approach. Inputs for interest rate derivatives include LIBOR interest rates, interest rate futures contracts, and occasionally, implied volatility of interest rate options. See Note 11 for additional information on how these derivatives are used.

A market price secured from the primary source vendor is then evaluated by management in its valuation of the assets within the trusts. As a general approach, fixed income market pricing vendors gather market data (including indices and market research reports) and integrate relative credit information, observed market movements, and sector news into proprietary pricing models, pricing systems, and mathematical tools. Dealer quotes and other market information, including live trading levels and pricing analysts' judgment, are also obtained when available.

Investments in private equity and real estate within the nuclear decommissioning trusts are generally classified as Level 3, as the underlying assets typically do not have observable inputs. The fund manager values these assets using various inputs and techniques depending on the nature of the underlying investments. The fair value of partnerships is determined by aggregating the value of the underlying assets.

"Other investments" include investments that are not traded in the open market. The fair value of these investment have been determined based on market factors including comparable multiples and the expectations regarding cash flows and business plan executions.

As of December 31, 2014 and 2013, the fair value measurements of investments calculated at net asset value per share (or its equivalent), as well as the nature and risks of those investments, were as follows:



	Fair Value		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
As of December 31, 2014:	(in millions)
Nuclear decommissioning trusts:
Foreign equity funds	$	121	None	Monthly	5 days
Equity – commingled funds	63		None	Daily/Monthly	Daily/7 days
Debt – commingled funds	15		None	Daily	5 days
Other – commingled funds	8		None	Daily	Not applicable
Other – money market funds	11		None	Daily	Not applicable
Trust-owned life insurance	115		None	Daily	15 days
Cash equivalents:
Money market funds	397		None	Daily	Not applicable
As of December 31, 2013:
Nuclear decommissioning trusts:
Foreign equity funds	$	131	None	Monthly	5 days
Corporate bonds – commingled funds	8		None	Daily	Not applicable
Equity – commingled funds	65		None	Daily/Monthly	Daily/7 days
Other – commingled funds	24		None	Daily	Not applicable
Trust-owned life insurance	110		None	Daily	15 days
Cash equivalents:
Money market funds	491		None	Daily	Not applicable

The NRC requires licensees of commissioned nuclear power reactors to establish a plan for providing reasonable assurance of funds for future decommissioning. Alabama Power and Georgia Power have the Funds to comply with the NRC's regulations. The foreign equity fund in Georgia Power's nuclear decommissioning trusts seeks to provide long-term capital appreciation. In pursuing this investment objective, the foreign equity fund primarily invests in a diversified portfolio of equity securities of foreign companies, including those in emerging markets. These equity securities may include, but are not limited to, common stocks, preferred stocks, real estate investment trusts, convertible securities, depositary receipts, including American depositary receipts, European depositary receipts, and global depositary receipts; and rights and warrants to buy common stocks. Georgia Power may withdraw all or a portion of its investment on the last business day of each month subject to a minimum withdrawal of $1 million, provided that a minimum investment of $10 million remains. If notices of withdrawal exceed 20% of the aggregate value of the foreign equity fund, then the foreign equity fund's board may refuse to permit the withdrawal of all such investments and may scale down the amounts to be withdrawn pro rata and may further determine that any withdrawal that has been postponed will have priority on the subsequent withdrawal date.

The other-commingled funds and other-money market funds in Georgia Power's nuclear decommissioning trusts are invested primarily in a diversified portfolio of high quality, short-term, liquid debt securities. The funds represent the cash collateral received under the Funds' managers' securities lending program and/or the excess cash held within each separate investment account. The primary objective of the funds is to provide a high level of current income consistent with stability of principal and liquidity. The funds invest primarily in, but not limited to, commercial paper, floating and variable rate demand notes, debt securities issued or guaranteed by the U.S. government or its agencies or instrumentalities, time deposits, repurchase agreements, municipal obligations, notes, and other high-quality short-term liquid debt securities that mature in 90 days or less. Redemptions are available on a same day basis up to the full amount of the investment in the funds. See Note 1 under "Nuclear Decommissioning" for additional information.

Alabama Power's nuclear decommissioning trusts include investments in TOLI. The taxable nuclear decommissioning trusts invest in the TOLI in order to minimize the impact of taxes on the portfolios and can draw on the value of the TOLI through death proceeds, loans against the cash surrender value, and/or the cash surrender value, subject to legal restrictions. The amounts reported in the table above reflect the fair value of investments the insurer has made in relation to the TOLI agreements. The nuclear decommissioning trusts do not own the underlying investments, but the fair value of the investments approximates the cash surrender value of the TOLI policies. The investments made by the insurer are in commingled funds. These commingled funds, along with other equity and debt commingled funds held in Alabama Power's nuclear decommissioning trusts, primarily include investments in domestic and international equity securities and predominantly high-quality fixed income securities. These fixed income securities may include U.S. Treasury and government agency fixed income securities, non-U.S. government and agency fixed income securities, domestic and foreign corporate fixed income securities, and mortgage and asset backed securities. The passively managed funds seek to replicate the performance of a related index. The actively managed funds seek to exceed the performance of a related index through security analysis and selection. See Note 1 under "Nuclear Decommissioning" for additional information.

The money market funds are short-term investments of excess funds in various money market mutual funds, which are portfolios of short-term debt securities. The money market funds are regulated by the SEC and typically receive the highest rating from credit rating agencies. Regulatory and rating agency requirements for money market funds include minimum credit ratings and maximum maturities for individual securities and a maximum weighted average portfolio maturity. Redemptions are available on a same day basis up to the full amount of the Company's investment in the money market funds.

As of December 31, 2014 and 2013, 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:
2014	$	24,015	$	25,816
2013	$	21,650	$	22,197

The fair values are determined using Level 2 measurements and are based on quoted market prices for the same or similar issues or on the current rates offered to Southern Company, Alabama Power, Georgia Power, Gulf Power, Mississippi Power, and Southern Power.

Alabama Power [Member]

Fair Value Disclosures [Line Items]

FAIR VALUE MEASUREMENTS


•	Level 1 consists of observable market data in an active market for identical assets or liabilities.


•	Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.


•	Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.

As of December 31, 2014, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2014:	(Level 1)		(Level 2)		(Level 3)		Total
	(in millions)
Assets:
Energy-related derivatives	$	—	$	1	$	—	$	1
Nuclear decommissioning trusts:^(a)
Domestic equity	403		83		—		486
Foreign equity	34		63		—		97
U.S. Treasury and government agency securities	—		34		—		34
Corporate bonds	—		111		—		111
Mortgage and asset backed securities	—		18		—		18
Other	—		5		3		8
Cash equivalents	162		—		—		162
Total	$	599	$	315	$	3	$	917
Liabilities:
Interest rate derivatives	$	—	$	8	$	—	$	8
Energy-related derivatives	—		53		—		53
Total	$	—	$	61	$	—	$	61


(a)	Excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases. See Note 1 under "Nuclear Decommissioning" for additional information.

As of December 31, 2013, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2013:	(Level 1)		(Level 2)		(Level 3)		Total
	(in millions)
Assets:
Energy-related derivatives	$	—	$	7	$	—	$	7
Nuclear decommissioning trusts:^(a)
Domestic equity	392		74		—		466
Foreign equity	35		65		—		100
U.S. Treasury and government agency securities	—		24		—		24
Corporate bonds	—		89		—		89
Mortgage and asset backed securities	—		18		—		18
Other	—		13		3		16
Cash equivalents	236		—		—		236
Total	$	663	$	290	$	3	$	956
Liabilities:
Energy-related derivatives	$	—	$	8	$	—	$	8


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

Valuation Methodologies



	Fair Value		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
As of December 31, 2014:	(in millions)
Nuclear decommissioning trusts:
Equity – commingled funds	$	63	None	Daily/Monthly	Daily/7 days
Trust – owned life insurance	115		None	Daily	15 days
Debt – commingled funds	15		None	Daily	5 days
Cash equivalents:
Money market funds	162		None	Daily	Not applicable
As of December 31, 2013:
Nuclear decommissioning trusts:
Equity – commingled funds	$	65	None	Daily/Monthly	Daily/7 days
Trust – owned life insurance	110		None	Daily	15 days
Cash equivalents:
Money market funds	236		None	Daily	Not applicable

The nuclear decommissioning trusts include investments in TOLI. The taxable nuclear decommissioning trusts invest in the TOLI in order to minimize the impact of taxes on the portfolios and can draw on the value of the TOLI through death proceeds, loans against the cash surrender value, and/or the cash surrender value, subject to legal restrictions. The amounts reported in the table above reflect the fair value of investments the insurer has made in relation to the TOLI agreements. The nuclear decommissioning trusts do not own the underlying investments, but the fair value of the investments approximates the cash surrender value of the TOLI policies. The investments made by the insurer are in commingled funds. These commingled funds, along with other equity and debt commingled funds held in the nuclear decommissioning trusts, primarily include investments in domestic and international equity securities and predominantly high-quality fixed income securities. These fixed income securities may include U.S. Treasury and government agency fixed income securities, non-U.S. government and agency fixed income securities, domestic and foreign corporate fixed income securities, and mortgage and asset backed securities. The passively managed funds seek to replicate the performance of a related index. The actively managed funds seek to exceed the performance of a related index through security analysis and selection.

As of December 31, 2014 and 2013, 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:
2014	$	6,631	$	7,321
2013	$	6,228	$	6,534

The fair values are determined using Level 2 measurements and are based on quoted market prices for the same or similar issues or on the current rates offered to the Company.

Georgia Power [Member]

Fair Value Disclosures [Line Items]

FAIR VALUE MEASUREMENTS


•	Level 1 consists of observable market data in an active market for identical assets or liabilities.


•	Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.


•	Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.

As of December 31, 2014, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2014:	(Level 1)		(Level 2)		(Level 3)		Total
	(in millions)
Assets:
Energy-related derivatives	$	—	$	7	$	—	$	7
Interest rate derivatives	—		6		—		6
Nuclear decommissioning trusts:^(a)
Domestic equity	180		2		—		182
Foreign equity	—		121		—		121
U.S. Treasury and government agency securities	—		96		—		96
Municipal bonds	—		62		—		62
Corporate bonds	—		188		—		188
Mortgage and asset backed securities	—		121		—		121
Other	11		8		—		19
Total	$	191	$	611	$	—	$	802
Liabilities:
Energy-related derivatives	$	—	$	27	$	—	$	27
Interest rate derivatives	—		14		—		14
Total	$	—	$	41	$	—	$	41


(a)	Includes the investment securities pledged to creditors and collateral received, and excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases and the lending pool. See Note 1 under "Nuclear Decommissioning" for additional information.

As of December 31, 2013, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2013:	(Level 1)		(Level 2)		(Level 3)		Total
	(in millions)
Assets:
Energy-related derivatives	$	—	$	5	$	—	$	5
Nuclear decommissioning trusts:^(a)
Domestic equity	197		1		—		198
Foreign equity	—		131		—		131
U.S. Treasury and government agency securities	—		79		—		79
Municipal bonds	—		64		—		64
Corporate bonds	—		140		—		140
Mortgage and asset backed securities	—		114		—		114
Other	—		24		—		24
Total	$	197	$	558	$	—	$	755
Liabilities:
Energy-related derivatives	$	—	$	21	$	—	$	21


(a)	Includes the investment securities pledged to creditors and collateral received, and excludes receivables related to investment income, pending investment sales, and payables related to pending investment purchases and the lending pool. See Note 1 under "Nuclear Decommissioning" for additional information.

Valuation Methodologies

For fair value measurements of the investments within the nuclear decommissioning trusts, external pricing vendors are designated for each asset class with each security specifically assigned a primary pricing source. For investments held within commingled funds, fair value is determined at the end of each business day through the net asset value, which is established by obtaining the underlying securities' individual prices from the primary pricing source. A market price secured from the primary source vendor is then evaluated by management in its valuation of the assets within the trusts. As a general approach, fixed income market pricing vendors gather market data (including indices and market research reports) and integrate relative credit information, observed market movements, and sector news into proprietary pricing models, pricing systems, and mathematical tools. Dealer quotes and other market information, including live trading levels and pricing analysts' judgment, are also obtained when available.



	Fair Value		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
As of December 31, 2014:	(in millions)
Nuclear decommissioning trusts:
Foreign equity fund	$	121	None	Monthly	5 days
Other — commingled funds	8		None	Daily	Not applicable
Other — money market funds	11		None	Daily	Not applicable
As of December 31, 2013:
Nuclear decommissioning trusts:
Foreign equity fund	$	131	None	Daily	5 days
Corporate bonds — commingled funds	8		None	Daily	Not applicable
Other — commingled funds	24		None	Daily	Not applicable

The NRC requires licensees of commissioned nuclear power reactors to establish a plan for providing reasonable assurance of funds for future decommissioning. The foreign equity fund in the nuclear decommissioning trusts seeks to provide long-term capital appreciation. In pursuing this investment objective, the foreign equity fund primarily invests in a diversified portfolio of equity securities of foreign companies, including those in emerging markets. These equity securities may include, but are not limited to, common stocks, preferred stocks, real estate investment trusts, convertible securities, depositary receipts, including American depositary receipts, European depositary receipts, and global depositary receipts; and rights and warrants to buy common stocks. The Company may withdraw all or a portion of its investment on the last business day of each month subject to a minimum withdrawal of $1 million, provided that a minimum investment of $10 million remains. If notices of withdrawal exceed 20% of the aggregate value of the foreign equity fund, then the foreign equity fund's board may refuse to permit the withdrawal of all such investments and may scale down the amounts to be withdrawn pro rata and may further determine that any withdrawal that has been postponed will have priority on the subsequent withdrawal date.

The other-commingled funds and other-money market funds in the nuclear decommissioning trusts are invested primarily in a diversified portfolio of high quality, short-term, liquid debt securities. The funds represent the cash collateral received under the Funds' managers' securities lending program and/or the excess cash held within each separate investment account. The primary objective of the funds is to provide a high level of current income consistent with stability of principal and liquidity. The funds invest primarily in, but not limited to, commercial paper, floating and variable rate demand notes, debt securities issued or guaranteed by the U.S. government or its agencies or instrumentalities, time deposits, repurchase agreements, municipal obligations, notes, and other high-quality short-term liquid debt securities that mature in 90 days or less. Redemptions are available on a same day basis up to the full amount of the investment in the funds. See Note 1 under "Nuclear Decommissioning" for additional information.

As of December 31, 2014 and 2013, 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:
2014	$	9,797	$	10,552
2013	$	8,593	$	8,782

The fair values are determined using Level 2 measurements and are based on quoted market prices for the same or similar issues or on current rates offered to the Company.

Gulf Power [Member]

Fair Value Disclosures [Line Items]

FAIR VALUE MEASUREMENTS


•	Level 1 consists of observable market data in an active market for identical assets or liabilities.


•	Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.


•	Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.

As of December 31, 2014, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2014:	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets:
Energy-related derivatives	$	—	$	125	$	—	$	125
Cash equivalents	18,032		—		—		18,032
Total	$	18,032	$	125	$	—	$	18,157
Liabilities:
Energy-related derivatives	$	—	$	72,435	$	—	$	72,435

As of December 31, 2013, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2013:	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets:
Energy-related derivatives	$	—	$	6,962	$	—	$	6,962
Cash equivalents	15,929		—		—		15,929
Total	$	15,929	$	6,962	$	—	$	22,891
Liabilities:
Energy-related derivatives	$	—	$	17,043	$	—	$	17,043

Valuation Methodologies



	Fair Value	Unfunded Commitments	Redemption Frequency	Redemption Notice Period
As of December 31, 2014:	(in thousands)
Cash equivalents:
Money market funds	$18,032	None	Daily	Not applicable
As of December 31, 2013:
Cash equivalents:
Money market funds	$15,929	None	Daily	Not applicable

As of December 31, 2014 and 2013, other financial instruments for which the carrying amount did not equal fair value were as follows:



	Carrying Amount		Fair Value
	(in thousands)
Long-term debt:
2014	$	1,369,594	$	1,476,954
2013	$	1,233,163	$	1,261,889

The fair values are determined using Level 2 measurements and are based on quoted market prices for the same or similar issues or on the current rates offered to the Company.

Mississippi Power [Member]

Fair Value Disclosures [Line Items]

FAIR VALUE MEASUREMENTS


•	Level 1 consists of observable market data in an active market for identical assets or liabilities.


•	Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.


•	Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.

As of December 31, 2014, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2014:	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets:
Energy-related derivatives	$	—	$	65	$	—	$	65
Cash equivalents	114,900		—		—		114,900
Total	$	114,900	$	65	$	—	$	114,965
Liabilities:
Energy-related derivatives	$	—	$	45,429	$	—	$	45,429

As of December 31, 2013, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2013:	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets:
Energy-related derivatives	$	—	$	4,803	$	—	$	4,803
Cash equivalents	125,000		—		—		125,000
Total	$	125,000	$	4,803	$	—	$	129,803
Liabilities:
Energy-related derivatives	$	—	$	10,281	$	—	$	10,281
Foreign currency derivatives	—		1		—		1
Total	$	—	$	10,282	$	—	$	10,282

Valuation Methodologies

The energy-related derivatives primarily consist of over-the-counter financial products for natural gas and physical power products, including, from time to time, basis swaps. These are standard products used within the energy industry and are valued using the market approach. The inputs used are mainly from observable market sources, such as forward natural gas prices, power prices, implied volatility, and overnight index swap interest rates. Foreign currency derivatives are also standard over-the-counter financial products valued using the market approach. Inputs for foreign currency derivatives are from observable market sources. See Note 10 for additional information on how these derivatives are used.



	Fair Value		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
As of December 31, 2014:	(in thousands)
Cash equivalents:
Money market funds	$	114,900	None	Daily	Not applicable
As of December 31, 2013:
Cash equivalents:
Money market funds	$	125,000	None	Daily	Not applicable

As of December 31, 2014 and 2013, other financial instruments for which the carrying amount did not equal fair value were as follows:



	Carrying Amount		Fair Value
	(in thousands)
Long-term debt:
2014	$	2,328,476	$	2,382,050
2013	$	2,098,639	$	2,045,519

The fair values are determined using Level 2 measurements and are based on quoted market prices for the same or similar issues or on the current rates offered to the Company.

Southern Power [Member]

Fair Value Disclosures [Line Items]

FAIR VALUE MEASUREMENTS


•	Level 1 consists of observable market data in an active market for identical assets or liabilities.


•	Level 2 consists of observable market data, other than that included in Level 1, that is either directly or indirectly observable.


•	Level 3 consists of unobservable market data. The input may reflect the assumptions of the Company of what a market participant would use in pricing an asset or liability. If there is little available market data, then the Company's own assumptions are the best available information.

As of December 31, 2014, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2014:	(Level 1)		(Level 2)		(Level 3)		Total
	(in millions)
Assets:
Energy-related derivatives	$	—	$	5.5	$	—	$	5.5
Cash equivalents	18.0		—		—		18.0
Total	$	18.0	$	5.5	$	—	$	23.5
Liabilities:
Energy-related derivatives	$	—	$	3.6	$	—	$	3.6

As of December 31, 2013, assets and liabilities measured at fair value on a recurring basis during the period, together with the level of the fair value hierarchy in which they fall, were as follows:



	Fair Value Measurements Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
As of December 31, 2013:	(Level 1)		(Level 2)		(Level 3)		Total
	(in millions)
Assets:
Energy-related derivatives	$	—	$	0.6	$	—	$	0.6
Cash equivalents	68.0		—		—		68.0
Total	$	68.0	$	0.6	$	—	$	68.6
Liabilities:
Energy-related derivatives	$	—	$	0.6	$	—	$	0.6

Valuation Methodologies



	Fair Value		Unfunded Commitments	Redemption Frequency	Redemption Notice Period
As of December 31, 2014:	(in millions)
Cash equivalents:
Money market funds	$	18.0	None	Daily	Not applicable
As of December 31, 2013:
Cash equivalents:
Money market funds	$	68.0	None	Daily	Not applicable

As of December 31, 2014 and 2013, 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:
2014	$	1,621	$	1,785
2013	$	1,620	$	1,660

The fair values are determined using Level 2 measurements and are based on quoted market prices for the same or similar issues or on the current rates offered to the Company.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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