Company: SOJE
Filing Date: 2025-03-31
Form Type: PRE 14A
Source: 0000092122-25-000032
Chunk: 56

Company: SOUTHERN CO
Filing Date: 2025-03-31
Form: PRE 14A
Chunk 56
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 intermittent renewable generation. Energy storage with a full-load discharge duration of greater than 8 hours will receive 0.75 MWs credit for each additional nameplate MW, recognizing the importance of long duration energy storage to enhance reliance on a high penetration of intermittent renewables.

Qualitative Component: The qualitative component creates incentives to achieve our net zero by 2050 goal through a qualitative assessment. The Compensation Committee, with input from the Operations, Environmental and Safety Committee, evaluates the relevant NEOs' leadership in advancing the energy portfolio of the future. The qualitative component is applied as a modifier to the payout determined under the quantitative component, providing an adjustment ranging from -25% to +50%. The qualitative analysis takes into account:

4 Leadership and energy policy (nationally and within the industry)

4 Decarbonization R&D investments (such as EPRI and Southern proprietary R&D)

4 Investments (such as corporate venture capital spend and Energy Impact Partners)

4 New business development (through Southern Power and PowerSecure including renewables, distributed generation and distributed infrastructure)

#### Southern Company2025 Proxy Statement55

#### Setting The Quantitative Component
To achieve the Company’s goal of reducing GHG emissions, a significant change in the Company’s generation fleet is required. The magnitude of change to the generation fleet necessary to meet the Company’s GHG reduction goals requires a long-term effort, begun years ago and ongoing, due to lead times associated with adding new generation resources, lead times associated with adding new transmission facilities, retiring existing generation resources, navigating and complying with regulatory approval procedures and maintaining reliability and affordability for customers.

Generation changes are “lumpy,” meaning the MW transition does not follow a straight line. Rather, the MW change will be larger in some years than in other years due to the discrete size of individual generation units and the lead times to implement the changes.

The GHG metric is based on the cumulative, realized actual change in MW over a forward-looking three-year performance period. Achievement of the metric is based on the actual date when new zero carbon and renewable generation begins commercial operation or when coal or gas steam generation is permanently removed from routine generation operations and dispatch. For the 2024-2026 performance period, the target cumulative MW change was set based on the 2021 projected MW change in 2024-2026 consistent with meeting the Company’s interim decarbonization goal. The stretch goal was set higher to accelerate achievement of the interim goal.

4 100% payout target metric: Set based on the 2021 projected MW change in 202