What is the main purpose of this 8-K filing?

The 8-K filing announces the filing of rebuttal testimony by Georgia Power Company in its base rate case with the Georgia Public Service Commission (Georgia PSC). This testimony includes a proposed Settlement Agreement for an Alternate Rate Plan (2010 ARP) that would set rates from January 1, 2011, through December 31, 2013.

What is the expected financial impact of the proposed Settlement Agreement on Georgia Power?

The Settlement Agreement proposes a total increase in base revenues of approximately $562.3 million for 2011. Additional increases are estimated at $189.7 million in 2012 and $92.6 million in 2013. The agreement also sets Georgia Power's retail return on common equity (ROE) at 11.15%, with a band of 10.25% to 12.25%.

How will this affect the average residential customer?

For a typical residential customer, the estimated monthly bill increase is approximately $10.76 effective January 1, 2011. Further increases are expected in 2012 ($3.08/month) and 2013 ($1.48/month) due to subsequent adjustments.

What are the key provisions regarding Georgia Power's earnings and potential shortfalls?

The settlement establishes a target retail ROE of 11.15% and an evaluation range of 10.25% to 12.25%. If earnings exceed 12.25%, two-thirds will be refunded to customers, and one-third retained by Georgia Power. There is no automatic recovery for shortfalls below 10.25%, but Georgia Power may petition for an Interim Cost Recovery (ICR) tariff or file a full rate case if it projects earnings below 10.25%.

Is this Settlement Agreement final, or could it change?

No, the Settlement Agreement is not final. It has been proposed by the Stipulating Parties and is subject to approval by the Georgia Public Service Commission (Georgia PSC). Hearings are scheduled in December 2010, and the PSC will vote on December 21, 2010. The terms of any final agreement approved by the PSC may differ materially from the current Settlement Agreement.

SOUTHERN CO 8-K SEC Disclosure

Summary

This 8-K filing from Southern Company (SO) on November 19, 2010, primarily concerns Georgia Power Company's retail base rate proceeding with the Georgia Public Service Commission (Georgia PSC). A key development is the filing of rebuttal testimony that includes a Settlement Agreement for an Alternate Rate Plan (2010 ARP) effective from January 1, 2011, through December 31, 2013. The Settlement Agreement proposes significant adjustments to Georgia Power's tariffs, leading to an approximate total increase in base revenues of $562.3 million in 2011, with further anticipated increases in 2012 and 2013. These increases are expected to impact typical residential customers, with an initial estimated rise of $10.76 per month. The agreement also establishes a new retail return on common equity (ROE) target of 11.15%, with earnings evaluated within a range of 10.25% to 12.25%, and outlines provisions for customer refunds of excess earnings and potential mechanisms for addressing earnings shortfalls.

Key Highlights

1Georgia Power has filed a Settlement Agreement for an Alternate Rate Plan (2010 ARP) with the Georgia PSC, effective January 1, 2011 - December 31, 2013.
2The proposed rate plan includes a total base revenue increase of approximately $562.3 million in 2011, achieved through increases in traditional base tariff rates, Demand-Side Management (DSM) tariffs, Environmental Compliance Cost Recovery (ECCR) tariffs, and Municipal Franchise Fee (MFF) tariffs.
3The estimated monthly increase for a typical residential customer is approximately $10.76 starting January 1, 2011.
4Future rate adjustments are planned for 2012 and 2013 related to DSM, capital costs for Plant McDonough Units 4, 5, and 6, and MFF tariffs, with estimated base revenue increases of $189.7 million in 2012 and $92.6 million in 2013.
5The settlement sets Georgia Power's retail return on common equity (ROE) at 11.15%, with earnings evaluated within a range of 10.25% to 12.25%.
6Earnings above 12.25% ROE will be split 2/3 refunded to customers and 1/3 retained by Georgia Power.
7The Settlement Agreement is subject to Georgia PSC approval, with hearings and a vote scheduled for December 2010, meaning the final terms may differ.

SOUTHERN CO 8-K Report, Corporate Update (Nov 19, 2010)

Summary

Key Highlights

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