UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D. C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
Report (Date of earliest event
reported) July 1,
2010
|
Commission
File Number
|
Registrant,
State of Incorporation,
Address And Telephone
Number
|
I.R.S.
Employer
Identification No.
|
|
1-3526
|
The
Southern Company
(A
Delaware Corporation)
30
Ivan Allen Jr. Boulevard, N.W.
Atlanta,
Georgia 30308
(404)
506-5000
|
58-0690070
|
| 1-6468 |
Georgia
Power Company
(A
Georgia Corporation)
241
Ralph McGill Boulevard, N.E.
Atlanta,
Georgia 30308
(404)
506-6526
|
58-0257110 |
The names
and addresses of the registrants have not changed since the last
report.
This
combined Form 8-K is filed separately by two registrants: The Southern Company
and Georgia Power Company. Information contained herein relating to
each registrant is filed by each registrant solely on its own
behalf. Each registrant makes no representation as to information
relating to the other registrant.
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
|
[ ]
|
Written
communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|
|
[ ]
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
|
|
[ ]
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
|
|
[ ]
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
Item
8.01. Other
Events.
See MANAGEMENT’S DISCUSSION AND
ANALYSIS – FUTURE EARNINGS POTENTIAL – “PSC Matters – Rate Plans” of Georgia
Power Company (“Georgia Power”) and MANAGEMENT’S DISCUSSION AND ANALYSIS –
FUTURE EARNINGS POTENTIAL – “PSC Matters – Georgia Power” of The Southern
Company (“Southern”) in Item 7 of the Annual Report on Form 10-K for the
year ended December 31, 2009 (the “Annual Report”). Also see Note 3
to the financial statements of Georgia Power under “Retail Regulatory Matters –
Rate Plans” and of Southern under “Retail Regulatory Matters – Georgia Power –
Retail Rate Plans” and “– Costs of Removal” in Item 8 of the Annual Report for
information regarding Georgia Power’s current retail rate plan (the “2007 Retail
Rate Plan”).
In accordance with the 2007 Retail Rate
Plan, Georgia Power filed a base rate case with the Georgia Public Service
Commission (“PSC”) on July 1, 2010 (the “2010 Rate Case”). The filing
includes a requested rate increase totaling $615 million, or 8.2 percent of
retail revenues, to be effective January 1, 2011 based on a
proposed retail return on common equity (“ROE”) of 11.95 percent. The
requested increase will be recovered through Georgia Power’s existing base rate
tariffs as follows: $451 million, or 6.0 percent, through the traditional base
rate tariffs, $115 million, or 1.5 percent, through the Environmental Compliance
Cost Recovery Tariff (“ECCR”) tariff, $32 million through the Demand Side
Management (“DSM”) tariffs, and $17 million through the Municipal Franchise Fee
(“MFF”) tariff. The majority of the increase in retail revenues
is being requested to cover the costs of environmental compliance and continued
investment in new generation, transmission and distribution facilities to
support growth and ensure reliability. The remainder of the increase
includes recovery of higher operation, maintenance and other investment costs to
meet the current and future demand for electricity.
2
Unlike rate plans based on traditional one-year test periods, the 2007 Retail
Rate Plan was designed to operate for the three-year period ending December 31,
2010. The 2010 Rate Case request includes proposed enhancements to the structure
of the 2007 Retail Rate Plan to fit the current economic climate, including a
process of annual tariff compliance reviews that would allow it to continue to
operate for multiple years (the “Proposed Alternate Rate Plan”). The
primary points of the Proposed Alternate Rate Plan include:
|
·
|
Continuation
of a plus or minus 100 basis point range for
ROE.
|
|
·
|
Creation
of an Adjustable Cost Recovery (“ACR”) tariff. If approved,
beginning with an effective date of January 1, 2012, the ACR will work to
maintain Georgia Power’s earnings within the ROE band established by the
Georgia PSC in this case. If Georgia Power’s earnings projected
for the upcoming year are within the ROE band, no adjustment under the ACR
tariff will be requested. If Georgia Power’s earnings projected
for the upcoming year are outside (either above or below) the approved ROE
band, the ACR tariff will be used to adjust projected earnings back to the
mid-point of the approved ROE band.
|
The ACR
tariff would also return to the sharing mechanism used prior to the 2007 Retail
Rate Plan whereby two-thirds of any actual earnings for the previous year above
the approved ROE band would be refunded to customers, with the remaining
one-third retained by Georgia Power as incentive to manage expenses and operate
as efficiently as possible. In addition, if earnings are below the
approved ROE band, Georgia Power would accept one-third of the shortfall and
retail customers would be responsible for the remaining two-thirds.
3
|
·
|
Creation
of a new Certified Capacity Cost Recovery (“CCCR”) tariff to recover costs
related to new capacity additions certified by the Georgia PSC and updated
through applicable project construction monitoring reports and
hearings.
|
|
·
|
Continuation
and enhancement of the ECCR and DSM-Residential tariffs from the 2007
Retail Rate Plan and creation of a DSM-Commercial tariff to recover
environmental capital and operating costs resulting from governmental
mandates and DSM costs approved and certified by the Georgia
PSC.
|
|
·
|
Implementation
of an annual review of the MFF tariff to adjust for changes in relative
gross receipts between customers served inside and outside municipal
boundaries.
|
These proposed enhancements would
become effective in 2012 with revenue requirements for each tariff updated
through separate compliance filings based on Georgia Power’s budget for the
upcoming year. Based on Georgia Power’s 2010 budget, earnings are currently
projected to be slightly below the proposed ROE band in 2012 and within the band
in 2013. However, updated budgets and revenue forecasts may
eliminate, increase or decrease the need for an ACR tariff adjustment in either
year. In addition, Georgia Power currently estimates the ECCR tariff
would increase by $120 million in 2012 and would decrease by $12 million in
2013. The CCCR tariff would begin recovering the costs of Plant
McDonough Units 4, 5 and 6 with increases of $99 million in February 2012, $77
million in June 2012, and $76 million in February 2013. The DSM
tariffs would increase by $17 million in 2012 and $18 million in 2013 to
reflect the terms of the stipulated agreement in Georgia Power’s 2010 DSM
Certification proceeding. Amounts recovered under the MFF tariff are
based on amounts recovered under all other tariffs.
4
Georgia Power expects the Georgia PSC
to issue a final order in this matter during December 2010. The final
outcome of this matter cannot now be determined.
Cautionary
Notice Regarding Forward-Looking Statements
This Current Report on Form 8-K
includes forward-looking statements regarding Georgia Power’s filing with the
Georgia PSC to increase retail base rates, implement new base rate tariffs, and
modify existing base rate tariffs, as well as statements regarding projected
earnings. There are various factors that could cause actual results
to differ materially from those suggested by the forward-looking statements;
accordingly, there can be no assurance that such indicated results will be
realized. These factors include: state and federal rate
regulations and the impact of pending and future rate cases and negotiations,
including rate actions relating to fuel and other cost recovery and the Georgia
PSC’s review of the 2010 Rate Case (the final outcome of which may differ
materially from Georgia Power’s proposal); the impact of recent and future
federal and state regulatory change, including legislative and regulatory
initiatives regarding deregulation and restructuring of the electric utility
industry, implementation of the Energy Policy Act of 2005, environmental laws
including regulation of water quality, coal combustion byproducts, and emissions
of sulfur, nitrogen, carbon, soot, particulate matter, hazardous air pollutants,
including mercury, and other substances, and also changes in tax and other laws
and regulations to which Southern and its subsidiaries, including Georgia Power,
are subject, as well as changes in application of existing laws and regulations;
current and future litigation, regulatory investigations, proceedings or
inquiries, including the pending Environmental Protection Agency civil actions
against certain Southern subsidiaries, Federal Energy Regulatory Commission
matters, and Internal Revenue Service audits; the effects, extent and timing of
the entry of additional competition in the markets in which Southern’s
subsidiaries, including Georgia Power, operate; variations in the demand for
electricity, including those related to weather, the general economy and
recovery from the recent recession, population and business growth (and
declines), and the effect of energy conservation measures; available sources and
costs of fuel; effects of inflation; ability to control costs and avoid cost
overruns during the development and construction of facilities; investment
performance of Southern’s employee benefit plans and Georgia Power’s nuclear
decommissioning trusts; advances in technology; potential Department of Energy
loan guarantees related to the potential Plant Vogtle expansion; internal
restructuring or other restructuring options that may be pursued; the ability of
counterparties of Southern and its subsidiaries, including Georgia Power, to
make payments as and when due and to perform as required; the ability to obtain
new short- and long-term contracts with wholesale customers; the direct or
indirect effect on the business of Southern and its subsidiaries, including
Georgia Power, resulting from terrorist incidents and the threat of terrorist
incidents; interest rate fluctuations and financial market conditions and the
results of financing efforts, and the credit ratings of Southern and its
subsidiaries, including Georgia Power; the ability of Southern and its
subsidiaries, including Georgia Power, to obtain additional generating capacity
at competitive prices; catastrophic events such as fires, earthquakes,
explosions, floods, hurricanes, pandemic health events, such as influenzas, or
other similar occurrences; the direct or indirect effects on the business of
Southern and its subsidiaries, including Georgia Power, resulting from incidents
affecting the U.S. electric grid or operation of generating resources; the
effect of accounting
5
pronouncements
issued periodically by standard setting bodies; and other factors discussed in
reports filed by Southern and Georgia Power from time to time with the
Securities and Exchange Commission, including the Annual
Report. Southern and Georgia Power expressly disclaim any obligation
to update these forward looking statements.
SIGNATURE
Pursuant to the requirements of the
Securities Exchange Act of 1934, each of the registrants has duly caused this
report to be signed on its behalf by the undersigned hereunto duly
authorized.
Date: July
1,
2010 THE
SOUTHERN COMPANY
By /s/Melissa
K.
Caen
Melissa K. Caen
Assistant Secretary
GEORGIA POWER COMPANY
By /s/Melissa
K.
Caen
Melissa K. Caen
Assistant Secretary