8-K: Georgia Power Reaches Settlement on Capacity Certification

Georgia Power Company has reached a settlement agreement with the Georgia Public Service Commission Staff to approve 9,885 megawatts of requested resources.

Summary

• Georgia Power Company and the Georgia Public Service Commission (PSC) Public Interest Advocacy Staff reached a settlement agreement on December 9, 2025.
• The agreement, if approved by the Georgia PSC, would resolve the Company's All-Source Certification Proceeding.
• All 9,885 megawatts of requested resources in the proceeding would be approved and certified at their respective individual project costs.
• Company-owned projects included in these resources total approximately $16.3 billion in projected capital investment, excluding allowance for funds used during construction.
• Approximately $14 billion of this capital investment is expected to be incurred between 2026 and 2029.
• Company-owned projects would be subject to construction monitoring by the Georgia PSC.
• Georgia Power agreed to file its next base rate case to ensure incremental revenue from large load customers creates downward pressure of at least $556 million per year on a levelized basis.
• This rate adjustment is equivalent to $8.50 per month (or approximately $102 per year) for a typical residential customer using 1,000 kilowatt-hours per month, for the years 2029, 2030, and 2031.
• The settlement agreement requires approval by the Georgia PSC, and its terms are subject to change.
• The Georgia PSC is scheduled to vote on December 19, 2025, to resolve all matters in the All-Source Certification Proceeding.

Sentiment

Score: 7

Explanation: The sentiment is positive due to the agreement on capacity certification and the inclusion of customer benefits, despite the pending PSC approval which introduces some uncertainty.

Positives

• Approval of all 9,885 megawatts of requested resources provides certainty for Georgia Power's future capacity needs.
• The settlement includes a commitment to downward pressure on residential customer rates, equivalent to $8.50 per month for typical users, which could foster positive customer and regulatory relations.
• The agreement resolves a significant regulatory proceeding, reducing uncertainty for the company.

Negatives

• The settlement agreement is subject to approval by the Georgia PSC, and its terms may differ materially from the final approved agreement.
• The ultimate outcome of the matter cannot be determined at this time, introducing a degree of uncertainty until the PSC vote.

Risks

• State and federal rate regulations and the impact of pending and future rate cases and negotiations, including rate actions relating to return on equity, equity ratios, additional generating capacity, transmission facilities, and fuel and other cost recovery mechanisms.
• Impact of recent and future federal and state regulatory changes, including tax, environmental, and other laws and regulations, as well as changes in application of existing laws, regulations, and guidance.
• The extent and timing of costs and legal requirements related to coal combustion residuals.
• Current and future litigation or regulatory investigations, proceedings, or inquiries.
• The effects, extent, and timing of the entry of additional competition in the markets, including from alternative energy sources.
• Variations in demand for electricity.
• Available sources and costs of natural gas and other fuels and commodities.
• Ability to control costs and avoid cost and schedule overruns during the development, construction, and operation of facilities or other projects.
• Legal proceedings and regulatory approvals and actions related to past, ongoing, and proposed construction projects.
• Ability to construct facilities in accordance with permits and licenses, satisfy environmental performance standards, meet tax credit requirements, and integrate facilities into The Southern Company system.
• Investment performance of employee and retiree benefit plans and nuclear decommissioning trust funds.
• Advances in technology, including lowto no-carbon energy and battery energy storage technologies.
• Ability to successfully operate generation, transmission, and distribution facilities and perform necessary corporate functions.
• Inherent risks involved in operating nuclear generating facilities.
• Ability of counterparties to make payments and perform as required.
• Direct or indirect effect on business from cyber intrusion or physical attack.
• Global and U.S. economic conditions, including impacts from geopolitical conflicts, recession, inflation, trade policies, interest rate fluctuations, and financial market conditions.
• Access to capital markets and other financing sources.
• Changes in credit ratings.
• Ability to obtain additional generating capacity (or sell excess) at competitive prices.
• Catastrophic events such as natural disasters, pandemic health events, political unrest, or wars.
• Direct or indirect effects on business from incidents affecting the U.S. electric grid or operation of generating resources.
• Effect of accounting pronouncements issued periodically by standard-setting bodies.

Future Outlook

The settlement agreement, if approved, provides a clear path for Georgia Power's capacity expansion with 9,885 megawatts of resources certified. It also outlines significant capital investments of approximately $16.3 billion, with $14 billion expected by 2029. The company anticipates filing its next base rate case to ensure downward pressure on customer rates in the coming years. However, the final outcome remains subject to the Georgia PSC's vote on December 19, 2025.

Management Comments

• Georgia Power Company and the Georgia Public Service Commission Public Interest Advocacy Staff reached a settlement agreement to resolve the All-Source Certification Proceeding.
• The Company-owned projects would require construction monitoring by the Georgia PSC.
• The Company would agree to file its next base rate case in a manner that will ensure the incremental revenue from large load customers has downward pressure, on a levelized basis, of at least $556 million per year.

Industry Context

This announcement reflects the ongoing regulatory environment for regulated utilities in the U.S., where significant capital expenditures for infrastructure and capacity expansion require state public service commission approval. The agreement to include customer rate benefits is a common element in such settlements, balancing utility investment needs with consumer protection. The focus on 'all-source' proposals indicates a trend towards diversified energy portfolios, including various generation technologies.

Legal Proceedings

• The All-Source Certification Proceeding, which the settlement agreement aims to resolve, is a regulatory matter concerning the certification of capacity from the 2029-2031 All-Source Request for Proposals and supplemental resources for 2028-2031 capacity.

Stakeholder Impact

• Shareholders: Potential for increased regulatory certainty and approved capital expenditures, which could support future earnings, but also exposure to significant capital investment risks and regulatory oversight.
• Customers: Expected downward pressure on residential rates, providing a benefit of approximately $8.50 per month for typical users from 2029-2031.
• Regulators (Georgia PSC): The settlement provides a framework for resolving a complex capacity certification proceeding, subject to their final approval and ongoing construction monitoring.
• Employees: Involvement in the execution of significant capital projects and ongoing operations related to the approved capacity.

Next Steps

• The Georgia Public Service Commission is scheduled to vote on December 19, 2025, to approve or modify the settlement agreement and resolve the All-Source Certification Proceeding.
• Georgia Power Company will proceed with projected capital investments totaling approximately $16.3 billion for company-owned projects, with $14 billion expected between 2026 and 2029, subject to PSC construction monitoring.
• Georgia Power will file its next base rate case to ensure downward pressure on customer rates for 2029, 2030, and 2031.

Key Dates

Recommendation

The settlement agreement is a positive development, providing clarity on future capacity and including customer benefits, which could lead to regulatory approval. However, the final approval by the Georgia PSC is still pending, and the terms could materially change. The significant projected capital investment also introduces execution risk. Therefore, a 'hold' recommendation is appropriate until the PSC's final decision and further details on financing and project execution become clear, balancing the positive settlement terms with the remaining uncertainties.

Keywords

Georgia Power, Southern Company, SEC Filing, 8-K, Utility, Energy, Regulation, Georgia Public Service Commission, Capacity Certification, Capital Investment, Rate Case, Junior Subordinated Notes, Corporate Units