Company: SOJE
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0000092122-25-000018
Chunk: 698

Company: SOUTHERN CO
Filing Date: 2025-02-20
Form: 10-K
Item: Item 7
Chunk 698
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 CNP Compliance-related operations and maintenance expenses and depreciation generally will have no effect on net income.In December 2022, December 2023, and November 2024, Alabama Power submitted calculations to the Alabama PSC associated with its cost of complying with governmental mandates for the following calendar year, as provided under Rate CNP Compliance. The 2022 filing reflected a $255 million, or 3.7%, annual increase effective with January 2023 billings, primarily due to updated depreciation rates. The 2023 filing reflected a $23 million, or 0.3%, annual decrease effective with January 2024 billings. The 2024 filing reflected a projected under recovered retail revenue requirement of $50 million. On December 3, 2024, the Alabama PSC issued a consent order requiring Alabama Power to leave the 2024 Rate CNP Compliance factors in effect for 2025, with any prior year under collected amount deemed recovered before any current year amounts are recovered, and any remaining under recovered amounts reflected in the 2025 filing.At December 31, 2024, Alabama Power had an under recovered Rate CNP Compliance balance of $35 million which is included in other regulatory assets, deferred on Southern Company's and Alabama Power's balance sheets. At December 31, 2023, Alabama Power had an under recovered Rate CNP Compliance balance of $33 million, of which $8 million is included in other regulatory assets, current and $25 million is included in other regulatory assets, deferred on Southern Company's and Alabama Power's balance sheets.Rate CNP DepreciationIn 2022, the Alabama PSC approved Rate CNP Depreciation, which allows Alabama Power to recover changes in depreciation resulting from updates to certain depreciation rates, excluding any depreciation recovered through Rate CNP New Plant, Rate CNP Compliance, or costs associated with the capitalization of asset retirement costs. Rate CNP Depreciation resulted in an annual revenue increase of approximately $318 million, or 4.6%, effective with January 2023 billings. No adjustments to Rate CNP Depreciation occurred during 2024 and no adjustment is expected for 2025.Rate ECRRate ECR recovers Alabama Power's retail energy costs based on an estimate of future energy costs and the current over or under recovered balance. Revenues recognized under Rate ECR and recorded on the financial statements are adjusted for the difference in actual recoverable fuel costs and amounts billed in current regulated rates