Company: SOJE
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0000092122-25-000042
Chunk: 163

Company: SOUTHERN CO
Filing Date: 2025-05-01
Form: 10-Q
Item: Item 8
Chunk 163
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2 3 Contract assets for Georgia Power primarily relate to unregulated service agreements, where payment is contingent on project completion, unbilled open access transmission tariff charges from 2024, and retail customer fixed bill programs, where the payment is contingent upon Georgia Power's continued performance and the customer's continued participation in the program over a one-year contract term. See Note 2 to the financial statements under "Georgia Power – Storm Damage Recovery" in Item 8 of the Form 10-K for additional information regarding unbilled open access transmission tariff charges. Contract liabilities for Georgia Power primarily relate to cash collections recognized in advance of revenue for unregulated service agreements. Southern Company Gas' contract assets relate to work performed on an energy efficiency enhancement and upgrade contract with the U.S. General Services Administration. Southern Company Gas received cash advances totaling approximately $68 million from a third-party financial institution to fund work performed. These advances have been accounted for as long-term debt on the balance sheets. See Note 1 to the financial statements under "Affiliate Transactions" in Item 8 of the Form 10-K for additional information regarding the construction contract. At March 31, 2025 and December 31, 2024, Southern Company's unregulated distributed generation business had contract assets of $90 million and $67 million, respectively, and contract liabilities of $109 million and $95 million, respectively, for outstanding performance obligations, all of which are expected to be satisfied within one year.Revenues recognized in the three months ended March 31, 2025, which were included in contract liabilities at December 31, 2024, were $28 million for Southern Company and immaterial for the other Registrants. Contract liabilities are primarily classified as current on the balance sheets as the corresponding revenues are generally expected to be recognized within one year.Remaining Performance ObligationsSouthern Company's subsidiaries may enter into long-term contracts with customers in which revenues are recognized as performance obligations are satisfied over the contract term. For the traditional electric operating companies and Southern Power, these contracts primarily relate to PPAs whereby electricity and generation capacity are provided to a customer. The revenue recognized for the delivery of electricity is variable; however, certain PPAs include a fixed payment for fixed generation capacity over the term of the contract. Southern Company's unregulated distributed generation business also has partially satisfied performance obligations related 

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    Table of Contents                                Index to Financial StatementsNOTES TO THE CONDENSED FINANCIAL STATEMENTS (Continued)(UNAUD