Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2014		2013			2012
	(in millions)
Federal —
Current	$	175	$	363		$	177
Deferred	695		386			1,011
	870		749			1,188
State —
Current	93		(10		)	61
Deferred	14		110			85
	107		100			146
Total	$	977	$	849		$	1,334

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2014			2013
	(in millions)
Deferred tax liabilities —
Accelerated depreciation	$	11,125		$	9,710
Property basis differences	1,332			1,515
Leveraged lease basis differences	299			287
Employee benefit obligations	613			491
Premium on reacquired debt	103			113
Regulatory assets associated with employee benefit obligations	1,390			705
Regulatory assets associated with AROs	871			824
Other	523			350
Total	16,256			13,995
Deferred tax assets —
Federal effect of state deferred taxes	430			421
Employee benefit obligations	1,675			1,048
Over recovered fuel clause	—			30
Other property basis differences	453			157
Deferred costs	86			84
ITC carryforward	480			121
Unbilled revenue	67			116
Other comprehensive losses	89			54
AROs	871			824
Estimated Loss on Kemper IGCC	631			472
Deferred state tax assets	117			77
Other	342			220
Total	5,241			3,624
Valuation allowance	(49		)	(49		)
Total deferred tax assets	5,192			3,575
Total deferred tax liabilities, net	11,064			10,420
Portion included in current assets/(liabilities), net	504			143
Accumulated deferred income taxes	$	11,568		$	10,563

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2014		2013		2012
Federal statutory rate	35.0	%	35.0	%	35.0	%
State income tax, net of federal deduction	2.3		2.5		2.5
Employee stock plans dividend deduction	(1.4	)	(1.6	)	(1.0	)
Non-deductible book depreciation	1.4		1.5		0.9
AFUDC-Equity	(2.9	)	(2.6	)	(1.3	)
ITC basis difference	(1.6	)	(1.2	)	(0.3	)
Other	(0.3	)	(0.5	)	(0.2	)
Effective income tax rate	32.5	%	33.1	%	35.6	%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2014			2013			2012
	(in millions)
Unrecognized tax benefits at beginning of year	$	7		$	70		$	120
Tax positions increase from current periods	64			3			13
Tax positions increase from prior periods	102			—			7
Tax positions decrease from prior periods	(3		)	(66		)	(56		)
Reductions due to settlements	—			—			(10		)
Reductions due to expired statute of limitations	—			—			(4		)
Balance at end of year	$	170		$	7		$	70

Impact on effective tax rate

The impact on Southern Company's effective tax rate, if recognized, is as follows:

	2014		2013		2012
	(in millions)
Tax positions impacting the effective tax rate	$	10	$	7	$	5
Tax positions not impacting the effective tax rate	160		—		65
Balance of unrecognized tax benefits	$	170	$	7	$	70

Alabama Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2014		2013		2012
	(in millions)
Federal —
Current	$	198	$	243	$	262
Deferred	225		160		137
	423		403		399
State —
Current	44		36		51
Deferred	45		39		27
	89		75		78
Total	$	512	$	478	$	477

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2014		2013
	(in millions)
Deferred tax liabilities —
Accelerated depreciation	$	3,429	$	3,187
Property basis differences	457		458
Premium on reacquired debt	30		33
Employee benefit obligations	215		209
Regulatory assets associated with employee benefit obligations	366		198
Asset retirement obligations	59		38
Regulatory assets associated with asset retirement obligations	285		265
Other	156		128
Total	4,997		4,516
Deferred tax assets —
Federal effect of state deferred taxes	219		205
Unbilled fuel revenue	42		41
Storm reserve	27		32
Employee benefit obligations	400		231
Other comprehensive losses	19		18
Asset retirement obligations	344		303
Other	90		108
Total	1,141		938
Total deferred tax liabilities, net	3,856		3,578
Portion included in current assets/(liabilities), net	18		25
Accumulated deferred income taxes	$	3,874	$	3,603

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2014	2013	2012
Federal statutory rate	35.0%	35.0%	35.0%
State income tax, net of federal deduction	4.4	4.0	4.1
Non-deductible book depreciation	1.1	1.0	0.9
Differences in prior years' deferred and current tax rates	(0.1)	(0.1)	(0.1)
AFUDC equity	(1.3)	(0.9)	(0.5)
Other	(0.1)	(0.1)	(0.3)
Effective income tax rate	39.0%	38.9%	39.1%

Changes in unrecognized tax benefits

The Company had no unrecognized tax benefits during 2014. Changes in unrecognized tax benefits in prior years were as follows:

	2013			2012
	(in millions)
Unrecognized tax benefits at beginning of year	$	31		$	32
Tax positions from current periods	—			5
Tax positions from prior periods	(31		)	(4		)
Reductions due to settlements	—			(2		)
Balance at end of year	$	—		$	31

Georgia Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2014			2013			2012
	(in millions)
Federal –
Current	$	295		$	277		$	273
Deferred	366			374			370
	661			651			643
State –
Current	82			(30		)	38
Deferred	(14		)	102			7
	68			72			45
Total	$	729		$	723		$	688

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2014		2013
	(in millions)
Deferred tax liabilities –
Accelerated depreciation	$	4,732	$	4,479
Property basis differences	811		873
Employee benefit obligations	329		232
Under-recovered fuel costs	81		—
Premium on reacquired debt	66		73
Regulatory assets associated with employee benefit obligations	534		276
Asset retirement obligations	497		495
Other	160		168
Total	7,210		6,596
Deferred tax assets –
Federal effect of state deferred taxes	148		159
Employee benefit obligations	642		388
Other property basis differences	86		93
Other deferred costs	86		84
Cost of removal obligations	11		17
State tax credit carry forward	170		118
Federal tax credit carry forward	5		3
Over-recovered fuel costs	—		22
Unbilled fuel revenue	46		53
Asset retirement obligations	497		495
Other	46		32
Total	1,737		1,464
Total deferred tax liabilities, net	5,473		5,132
Portion included in current assets/(liabilities), net	34		68
Accumulated deferred income taxes	$	5,507	$	5,200

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2014	2013	2012
Federal statutory rate	35.0%	35.0%	35.0%
State income tax, net of federal deduction	2.2	2.5	1.6
Non-deductible book depreciation	1.3	1.3	1.2
AFUDC equity	(0.8)	(0.6)	(1.0)
Other	(0.7)	(0.4)	(0.1)
Effective income tax rate	37.0%	37.8%	36.7%

Changes in unrecognized tax benefits

Changes in unrecognized tax benefits in prior years were as follows:

	2013			2012
	(in millions)
Unrecognized tax benefits at beginning of year	$	23		$	47
Tax positions increase from current periods	—			3
Tax positions increase from prior periods	—			3
Tax positions decrease from prior periods	(23		)	(19		)
Reductions due to settlements	—			(8		)
Reductions due to expired statute of limitations	—			(3		)
Balance at end of year	$	—		$	23

Gulf Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2014			2013			2012
	(in thousands)
Federal -
Current	$	22,771		$	5,009		$	(92,610	)
Deferred	52,602			63,134			161,096
	75,373			68,143			68,486
State -
Current	(39		)	(2,410		)	(2,484		)
Deferred	12,728			13,935			13,209
	12,689			11,525			10,725
Total	$	88,062		$	79,668		$	79,211

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2014		2013
	(in thousands)
Deferred tax liabilities-
Accelerated depreciation	$	776,953	$	721,087
Property basis differences	52,242		45,960
Fuel recovery clause	16,148		7,972
Pension and other employee benefits	34,405		25,800
Regulatory assets associated with employee benefit obligations	59,788		27,660
Regulatory assets associated with asset retirement obligations	6,768		6,554
Other	21,712		23,947
Total	968,016		858,980
Deferred tax assets-
Federal effect of state deferred taxes	30,587		24,277
Postretirement benefits	18,033		17,816
Pension and other employee benefits	65,506		33,015
Property reserve	13,440		15,144
Asset retirement obligations	6,768		6,554
Alternative minimum tax carryforward	18,200		18,420
Other	18,893		17,780
Total	171,427		133,006
Net deferred tax liabilities	796,589		725,974
Portion included in current assets/(liabilities), net	3,134		8,381
Accumulated deferred income taxes	$	799,723	$	734,355

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2014	2013	2012
Federal statutory rate	35.0%	35.0%	35.0%
State income tax, net of federal deduction	3.5	3.5	3.3
Non-deductible book depreciation	0.4	0.5	0.5
Differences in prior years' deferred and current tax rates	(0.1)	(0.2)	(0.2)
AFUDC equity	(1.8)	(1.1)	(0.9)
Other, net	0.1	(0.1)	(0.2)
Effective income tax rate	37.1%	37.6%	37.5%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2014			2013			2012
	(in thousands)
Unrecognized tax benefits at beginning of year	$	45		$	5,007		$	2,892
Tax positions increase from current periods	46			45			2,630
Tax positions increase/(decrease) from prior periods	(45		)	(5,007		)	515
Reductions due to settlements	—			—			(1,030		)
Balance at end of year	$	46		$	45		$	5,007

Impact on effective tax rate

The impact on the Company's effective tax rate, if recognized, is as follows:

	2014		2013		2012
	(in thousands)
Tax positions impacting the effective tax rate	$	46	$	45	$	45
Tax positions not impacting the effective tax rate	—		—		4,962
Balance of unrecognized tax benefits	$	46	$	45	$	5,007

Mississippi Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2014			2013			2012
	(in thousands)
Federal —
Current	$	(431,077	)	$	23,345		$	1,212
Deferred	183,461			(342,870		)	16,994
	(247,616		)	(319,525		)	18,206
State —
Current	455			5,219			1,656
Deferred	(38,044		)	(53,529		)	694
	(37,589		)	(48,310		)	2,350
Total	$	(285,205	)	$	(367,835	)	$	20,556

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2014		2013
	(in thousands)
Deferred tax liabilities —
Accelerated depreciation	$	1,068,242	$	371,553
Property basis differences	—		130,679
ECM under recovered	—		1,777
Regulatory assets associated with AROs	19,299		16,764
Pensions and other benefits	35,200		23,769
Regulatory assets associated with employee benefit obligations	67,727		33,127
Regulatory assets associated with the Kemper IGCC	61,561		30,708
Rate differential	89,040		56,074
Federal effect of state deferred taxes	1,279		30,615
Fuel clause under recovered	3,288		—
Other	52,215		35,583
Total	1,397,851		730,649
Deferred tax assets —
Fuel clause over recovered	—		7,741
Estimated loss on Kemper IGCC	631,326		472,000
Pension and other benefits	92,232		57,999
Property insurance	24,315		23,693
Premium on long-term debt	20,694		23,736
Unbilled fuel	14,535		12,136
AROs	19,299		16,764
Interest rate hedges	4,544		5,094
Kemper rate factor - regulatory liability retail	108,312		36,210
Property basis difference	263,430		—
ECM over recovered	905		—
Deferred state tax assets	56,736		—
Other	15,111		18,094
Total	1,251,439		673,467
Total deferred tax liabilities, net	146,412		57,182
Portion included in (accrued) prepaid income taxes, net	121,049		15,626
Deferred state tax asset	17,388		—
Accumulated deferred income taxes	$	284,849	$	72,808

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2014		2013		2012
Federal statutory rate	(35.0	)%	(35.0	)%	35.0	%
State income tax, net of federal deduction	(4.0	)	(3.7	)	1.3
Non-deductible book depreciation	0.1		0.1		0.3
AFUDC-equity	(7.8	)	(5.0	)	(18.6	)
Other	0.1		(0.1	)	(1.2	)
Effective income tax rate (benefit rate)	(46.6	)%	(43.7	)%	16.8	%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2014		2013			2012
	(in thousands)
Unrecognized tax benefits at beginning of year	$	3,840	$	5,755		$	4,964
Tax positions from current periods	58,148		226			1,186
Tax positions from prior periods	102,833		(2,141		)	(26		)
Settlements with taxing authorities	—		—			(369		)
Balance at end of year	$	164,821	$	3,840		$	5,755

Impact on effective tax rate

The impact on the Company's effective tax rate, if recognized, is as follows:

	2014		2013		2012
	(in thousands)
Tax positions impacting the effective tax rate	$	4,341	$	3,840	$	3,656
Tax positions not impacting the effective tax rate	160,480		—		2,099
Balance of unrecognized tax benefits	$	164,821	$	3,840	$	5,755

Accrued interest for unrecognized tax benefits

Accrued interest for unrecognized tax benefits was as follows:

	2014		2013		2012
	(in thousands)
Interest accrued at beginning of year	$	1,171	$	772	$	680
Interest accrued during the year	1,698		399		92
Balance at end of year	$	2,869	$	1,171	$	772

Southern Power [Member]

Income Tax Disclosure [Line Items]

Details of income tax provisions

Details of income tax provisions are as follows:

	2014			2013			2012
	(in millions)
Federal —
Current	$	178.6		$	(120.2	)	$	(133.1	)
Deferred	(166.0		)	158.7			210.4
	12.6			38.5			77.3
State —
Current	(13.8		)	(5.2		)	(3.0		)
Deferred	(2.0		)	12.6			18.3
	(15.8		)	7.4			15.3
Total	$	(3.2	)	$	45.9		$	92.6

Tax effects between the carrying amounts of assets and liabilities

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases, which give rise to deferred tax assets and liabilities, are as follows:

	2014			2013
	(in millions)
Deferred tax liabilities —
Accelerated depreciation and other property basis differences	$	1,006.5		$	829.5
Basis difference on asset transfers	2.6			2.8
Levelized capacity revenues	17.1			11.2
Other	5.7			0.9
Total	1,031.9			844.4
Deferred tax assets —
Federal effect of state deferred taxes	28.9			29.7
Net basis difference on federal ITCs	101.5			58.0
Alternative minimum tax carryforward	15.0			1.1
Unrealized tax credits	305.2			—
Unrealized loss on interest rate swaps	6.1			11.2
Levelized capacity revenues	4.9			6.0
Deferred state tax assets	14.5			17.0
Other	4.1			4.7
Total	480.2			127.7
Valuation Allowance	(7.5		)	(7.5		)
Net deferred income tax assets	472.7			120.2
Total deferred tax liabilities, net	559.2			724.2
Portion included in current assets/(liabilities), net	303.6			0.2
Accumulated deferred income taxes	$	862.8		$	724.4

Reconciliation of federal statutory income tax rate to effective income tax rate

A reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows:

	2014		2013		2012
Federal statutory rate	35.0	%	35.0	%	35.0	%
State income tax, net of federal deduction	(6.0	)	2.2		3.7
Amortization of ITC	(4.3	)	(1.7	)	(1.0	)
ITC basis difference	(27.7	)	(14.5	)	(2.6	)
Other	1.1		0.3		(0.6	)
Effective income tax rate	(1.9	)%	21.3	%	34.5	%

Changes in unrecognized tax benefits

Changes during the year in unrecognized tax benefits were as follows:

	2014			2013			2012
	(in millions)
Unrecognized tax benefits at beginning of year	$	1.5		$	2.9		$	2.6
Tax positions increase from current periods	4.7			1.6			0.7
Tax positions decrease from prior periods	(1.5		)	(3.0		)	(0.2		)
Reductions due to settlements	—			—			(0.2		)
Balance at end of year	$	4.7		$	1.5		$	2.9

Impact on effective tax rate

The impact on the Company's effective tax rate, if recognized, is as follows:

	2014	2013	2012
	(in millions)
Tax positions impacting the effective tax rate	$4.7	$1.5	$0.3
Tax positions not impacting the effective tax rate	—	—	2.6
Balance of unrecognized tax benefits	$4.7	$1.5	$2.9