Company: SOJE
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0000092122-25-000042
Chunk: 98

Company: SOUTHERN CO
Filing Date: 2025-05-01
Form: 10-Q
Item: Item 1
Chunk 98
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51 million primarily due to a $45 million increase associated with the average cost of fuel. Purchased power expense increased $10 million primarily due to an $8 million increase associated with the average cost of purchased power.

102

    Table of Contents                                Index to Financial StatementsMANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONAND RESULTS OF OPERATIONS (Continued)

Depreciation and Amortization

First Quarter 2025 vs. First Quarter 2024(change in millions)(% change)$3428.8

In the first quarter 2025, depreciation and amortization was $152 million compared to $118 million for the corresponding period in 2024. The increase was primarily due to $27 million in accelerated depreciation related to the repowering of the Kay Wind facility. See Note (K) to the Condensed Financial Statements under "Southern Power – Wind Repowering Projects" herein and Note 15 to the financial statements under "Southern Power – Development Projects" in Item 8 of the Form 10-K for additional information.

Income Taxes (Benefit)

First Quarter 2025 vs. First Quarter 2024(change in millions)(% change)$1392.9

In the first quarter 2025, income tax benefit was $1 million compared to $14 million for the corresponding period in 2024. The decrease was primarily due to a change in pre-tax earnings attributable to Southern Power, including the impact of accelerated depreciation related to the repowering of the Kay Wind facility. See Note (G) to the Condensed Financial Statements and Note (K) to the Condensed Financial Statements under "Southern Power – Wind Repowering Projects" herein for additional information.

Southern Company Gas

Southern Company Gas measures weather and the effect on its business using Heating Degree Days. Generally, increased Heating Degree Days results in higher demand for natural gas on Southern Company Gas' distribution system. Southern Company Gas has various regulatory mechanisms, such as weather and revenue normalization and straight-fixed-variable rate design, which limit its exposure to weather changes within typical ranges in each of its utility's respective service territory. Southern Company Gas also utilizes weather hedges to limit the negative income impacts in the event of warmer-than-normal weather in Illinois for gas distribution operations and in Illinois and Georgia for gas marketing services. Therefore, weather typically does not have a significant net income impact.

During the Heating Season, more customers are connected to the gas distribution systems and natural gas usage is higher in