Company: SOJE
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0000092122-25-000018
Chunk: 36

Company: SOUTHERN CO
Filing Date: 2025-02-20
Form: 10-K
Item: Item 5
Chunk 36
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 primarily due to lower natural gas prices.

II-23

    Table of Contents                                Index to Financial Statements        COMBINED MANAGEMENT'S DISCUSSION AND ANALYSIS

Energy purchases from non-affiliates will vary depending on the market prices of wholesale energy as compared to the cost of the Southern Company system's generation, demand for energy within the Southern Company system's electric service territory, and the availability of the Southern Company system's generation.

Purchased Power – Affiliates

Purchased power expense from affiliates was $745 million in 2024, a decrease of $19 million, or 2.5%, compared to 2023. The decrease was primarily due to a decrease of 6.3% in the volume of KWHs purchased as Southern Company system units generally dispatched at a higher cost than available market resources, partially offset by capacity purchased through a new PPA with Mississippi Power and an increase of 3.8% in the average cost per KWH purchased.

Energy purchases from affiliates will vary depending on the demand and the availability and cost of generating resources at each company within the Southern Company system. These purchases are made in accordance with the IIC or other contractual agreements, all as approved by the FERC.

Other Operations and Maintenance Expenses

Other operations and maintenance expenses increased $289 million, or 13.9%, in 2024 as compared to 2023. The increase was primarily due to increases of $167 million in transmission and distribution costs primarily associated with line maintenance and billing adjustments with integrated transmission system owners, $126 million in generation expenses largely resulting from Plant Vogtle Units 3 and 4 being placed in service in July 2023 and April 2024, respectively, $40 million in expenses associated with unregulated power delivery construction and maintenance contracts, and $27 million in customer service and sales costs primarily associated with bad debt expense. Partially offsetting the increase was an increase of $91 million in gains from sales of integrated transmission system assets. See Note 2 to the financial statements under "Georgia Power – Transmission Asset Sales" and " – Nuclear Construction" for additional information.

Depreciation and Amortization

Depreciation and amortization increased $93 million, or 5.5%, in 2024 as compared to 2023 primarily due to an increase of $173 million associated with additional plant in service, partially offset by a decrease of $59 million in amortization of regulatory assets related to CCR AROs as approved in