Company: SOJE
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0000092122-25-000018
Chunk: 781

Company: SOUTHERN CO
Filing Date: 2025-02-20
Form: 10-K
Item: Item 7A
Chunk 781
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 gas was $1.2 billion, a decrease of $448 million, or 27.3%, in 2024 as compared to 2023, which reflects lower gas cost recovery in 2024 as a result of a 17.1% decrease in natural gas prices compared to 2023.

Other Operations and Maintenance Expenses

Other operations and maintenance expenses decreased $40 million, or 3.1%, in 2024 as compared to 2023. The decrease was primarily due to prior year regulatory disallowances totaling $88 million at Nicor Gas and decreases of $12 million related to energy services contracts and $9 million in expenses passed through to customers primarily related to bad debt and energy efficiency programs at the natural gas distribution utilities, partially offset by increases of $56 million in compensation and benefit expenses and $20 million in survey, locate, and inspection expenses for distribution gas mains. See Note 2 to the financial statements under "Southern Company Gas" for additional information.

Depreciation and Amortization

Depreciation and amortization increased $68 million, or 11.7%, in 2024 as compared to 2023. The increase was primarily due to continued investments at the natural gas distribution utilities. See Note 2 to the financial statements under "Southern Company Gas – Infrastructure Replacement Programs and Capital Projects" for additional information.

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

Interest Expense, Net of Amounts Capitalized

Interest expense, net of amounts capitalized increased $31 million, or 10.0%, in 2024 as compared to 2023. The increase reflects approximately $17 million related to higher average outstanding borrowings and $14 million related to higher interest rates. See FINANCIAL CONDITION AND LIQUIDITY – "Sources of Capital" and "Financing Activities" herein and Note 8 to the financial statements for additional information.

Income Taxes

Income taxes increased $47 million, or 22.3%, in 2024 as compared to 2023. The increase was primarily due to higher pre-tax earnings. See Note 10 to the financial statements for additional information.

Other Business Activities

Southern Company's other business activities primarily include the parent company (which does not allocate operating expenses to business units); PowerSecure, which provides distributed energy and resilience solutions and deploys microgrids for commercial, industrial, governmental, and utility customers; Southern Holdings