##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-Q/A
 Amendment No. 1
 þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2007
 OR
 o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission
    
    Registrant, State of Incorporation,
    
    I.R.S. EmployerFile Number
    
    Address and Telephone Number
    
    Identification No.1-3526
    
    The Southern Company
    
    58-0690070(A Delaware Corporation)30 Ivan Allen Jr. Boulevard, N.W.Atlanta, Georgia 30308(404) 506-50001-6468
    
    Georgia Power Company
    
    58-0257110(A Georgia Corporation)241 Ralph McGill Boulevard, N.E.Atlanta, Georgia 30308(404) 506-6526




---



##### Table of Contents



Indicate by check mark whether the registrants (1) have filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrants were required to file such reports), and (2) have been
subject to such filing requirements for the past 90 days. Yes þ No o
 Indicate by check mark whether the registrant is a large accelerated filer, an accelerated
filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated
filer in Rule 12b-2 of the Exchange Act. (Check one):
 LargeAccelerated
    
    Accelerated
    
    Non-acceleratedRegistrant
    
    Filer
    
    Filer
    
    FilerThe Southern Company
    
    
    XGeorgia Power Company
    
    
    
    
    
    
    
    
    
    
    X
 Indicate by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act.) Yes o No þ
 Description of
    
    Shares OutstandingRegistrant
    
    Common Stock
    
    at September 30, 2007The Southern Company
    
    Par Value $5 Per Share
    
    
    
    759,478,801Georgia Power Company
    
    Without Par Value
    
    
    
    9,261,500
  2




---



##### 



INDEX TO QUARTERLY REPORT ON FORM 10-Q/A
September 30, 2007
  
 PageNumberEXPLANATORY NOTE
    
    
    4PART I  FINANCIAL INFORMATIONItem 1.
    
    Financial Statements (Unaudited)The Southern Company and Subsidiary Companies Condensed Consolidated Statements of Income
    
    
    6Condensed Consolidated Statements of Cash Flows
    
    
    7Condensed Consolidated Balance Sheets
    
    
    8Condensed Consolidated Statements of Comprehensive Income
    
    
    10Georgia Power CompanyCondensed Statements of Income
    
    
    12Condensed Statements of Comprehensive Income
    
    
    12Condensed Statements of Cash Flows
    
    
    13Condensed Balance Sheets
    
    
    14Notes to the Condensed Financial Statements
    
    
    16PART II  OTHER INFORMATIONExhibit Index
    
    
    33Signatures
    
    
    34
  3




---



##### Table of Contents



EXPLANATORY NOTE
  
    
    In the condensed consolidated balance sheet of Southern Company included on page 11 of
the Form 10-Q, the line item Long-term Debt was shown as $13,095,389 (in thousands)
and should have been shown as $13,404,668 (in thousands) and the line item Long-term
Debt Payable to Affiliated Trusts was shown as $721,651 (in thousands) and should have
been shown as $412,372 (in thousands). These amounts have been corrected in the
condensed consolidated balance sheet of Southern Company included on page 9 of this
amendment.
    
    In the condensed balance sheet of Georgia Power included on page 59 of the Form 10-Q,
the line item Long-term Debt was shown as $5,207,764 (in thousands) and should have
been shown as $5,517,043 (in thousands) and the line item Long-term Debt Payable to
Affiliated Trusts was shown as $515,465 (in thousands) and should have been shown as
$206,186 (in thousands). These amounts have been corrected in the condensed balance
sheet of Georgia Power included on page 15 of this amendment.
  4




---



##### Table of Contents



THE SOUTHERN COMPANY
 AND SUBSIDIARY COMPANIES
 5




---



##### Table of Contents



THE SOUTHERN COMPANY AND SUBSIDIARY COMPANIES
 
  For the Three Months
    
    
    For the Nine MonthsEnded September 30,
    
    
    Ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006(in thousands)
    
    
    (in thousands)Operating Revenues:Retail revenues
    
    $
    4,085,704
    
    
    $
    3,853,423
    
    
    $
    9,934,571
    
    
    $
    9,295,223Wholesale revenues
    
    
    563,233
    
    
    
    506,326
    
    
    
    1,530,809
    
    
    
    1,361,097Other electric revenues
    
    
    130,590
    
    
    
    120,001
    
    
    
    381,467
    
    
    
    347,086Other revenues
    
    
    52,516
    
    
    
    69,628
    
    
    
    165,793
    
    
    
    200,735Total operating revenues
    
    
    4,832,043
    
    
    
    4,549,378
    
    
    
    12,012,640
    
    
    
    11,204,141Operating Expenses:Fuel
    
    
    1,738,693
    
    
    
    1,625,046
    
    
    
    4,512,718
    
    
    
    3,981,241Purchased power
    
    
    281,489
    
    
    
    239,891
    
    
    
    445,698
    
    
    
    483,145Other operations
    
    
    651,127
    
    
    
    603,346
    
    
    
    1,802,876
    
    
    
    1,753,719Maintenance
    
    
    260,449
    
    
    
    236,647
    
    
    
    831,483
    
    
    
    793,569Depreciation and amortization
    
    
    311,939
    
    
    
    300,104
    
    
    
    928,569
    
    
    
    896,562Taxes other than income taxes
    
    
    206,763
    
    
    
    186,631
    
    
    
    574,329
    
    
    
    540,834Total operating expenses
    
    
    3,450,460
    
    
    
    3,191,665
    
    
    
    9,095,673
    
    
    
    8,449,070Operating Income
    
    
    1,381,583
    
    
    
    1,357,713
    
    
    
    2,916,967
    
    
    
    2,755,071Other Income and (Expense):Allowance for equity funds used during construction
    
    
    28,050
    
    
    
    11,847
    
    
    
    71,821
    
    
    
    33,772Interest income
    
    
    11,638
    
    
    
    12,748
    
    
    
    31,853
    
    
    
    25,657Equity in losses of unconsolidated subsidiaries
    
    
    (410
    )
    
    
    (133
    )
    
    
    (20,712
    )
    
    
    (44,985
    )Leveraged lease income
    
    
    12,359
    
    
    
    16,787
    
    
    
    31,928
    
    
    
    52,489Impairment loss on equity method investments
    
    
    
    
    
    
    (695
    )
    
    
    
    
    
    
    (15,969
    )Interest expense, net of amounts capitalized
    
    
    (220,090
    )
    
    
    (185,189
    )
    
    
    (614,345
    )
    
    
    (542,259
    )Interest expense to affiliate trusts
    
    
    (12,696
    )
    
    
    (30,550
    )
    
    
    (58,867
    )
    
    
    (91,819
    )Preferred and preference dividends of subsidiaries
    
    
    (10,451
    )
    
    
    (9,120
    )
    
    
    (30,709
    )
    
    
    (26,141
    )Other income (expense), net
    
    
    17,271
    
    
    
    (30,154
    )
    
    
    8,325
    
    
    
    (26,986
    )Total other income and (expense)
    
    
    (174,329
    )
    
    
    (214,459
    )
    
    
    (580,706
    )
    
    
    (636,241
    )Earnings Before Income Taxes
    
    
    1,207,254
    
    
    
    1,143,254
    
    
    
    2,336,261
    
    
    
    2,118,830Income taxes
    
    
    445,259
    
    
    
    405,269
    
    
    
    806,424
    
    
    
    734,015Consolidated Net Income
    
    $
    761,995
    
    
    $
    737,985
    
    
    $
    1,529,837
    
    
    $
    1,384,815Common Stock Data:Earnings per share-Basic
    
    $
    1.00
    
    
    $
    0.99
    
    
    $
    2.03
    
    
    $
    1.86Diluted
    
    $
    1.00
    
    
    $
    0.99
    
    
    $
    2.02
    
    
    $
    1.85Average number of basic shares of common
stock outstanding (in thousands)
    
    
    758,308
    
    
    
    742,884
    
    
    
    754,568
    
    
    
    742,532Average number of diluted shares of common
stock outstanding (in thousands)
    
    
    762,392
    
    
    
    747,560
    
    
    
    759,182
    
    
    
    746,983Cash dividends paid per share of common stock
    
    $
    0.4025
    
    
    $
    0.3875
    
    
    $
    1.1925
    
    
    $
    1.1475
  6




---



##### Table of Contents



THE SOUTHERN COMPANY AND SUBSIDIARY COMPANIES
 
  For the Nine MonthsEnded September 30,2007
    
    
    2006(in thousands)Operating Activities:Consolidated net income
    
    $
    1,529,837
    
    
    $
    1,384,815Adjustments to reconcile consolidated net income
to net cash provided from operating activities Depreciation and amortization
    
    
    1,108,475
    
    
    
    1,059,567Deferred income taxes and investment tax credits
    
    
    102,314
    
    
    
    344,062Allowance for equity funds used during construction
    
    
    (71,821
    )
    
    
    (33,772
    )Equity in losses of unconsolidated subsidiaries
    
    
    20,712
    
    
    
    44,985Leveraged lease income
    
    
    (31,928
    )
    
    
    (52,489
    )Pension, postretirement, and other employee benefits
    
    
    75,303
    
    
    
    74,033Stock option expense
    
    
    26,011
    
    
    
    25,045Hedge settlements
    
    
    15,151
    
    
    
    18,006Hurricane Katrina grant proceeds-property reserve
    
    
    60,000
    
    
    
    Other, net
    
    
    10,454
    
    
    
    47,060Changes in certain current assets and liabilities Receivables
    
    
    (426,107
    )
    
    
    (460,092
    )Fossil fuel stock
    
    
    (57,624
    )
    
    
    (136,720
    )Materials and supplies
    
    
    (55,191
    )
    
    
    (56,559
    )Other current assets
    
    
    (2,808
    )
    
    
    61,019Hurricane Katrina grant proceeds
    
    
    14,345
    
    
    
    Accounts payable
    
    
    (3,951
    )
    
    
    (319,564
    )Accrued taxes
    
    
    303,781
    
    
    
    185,626Accrued compensation
    
    
    (148,274
    )
    
    
    (162,455
    )Other current liabilities
    
    
    (1,342
    )
    
    
    (42,382
    )Net cash provided from operating activities
    
    
    2,467,337
    
    
    
    1,980,185Investing Activities:Property additions
    
    
    (2,469,059
    )
    
    
    (2,112,780
    )Investment in restricted cash from pollution control bonds
    
    
    (96,052
    )
    
    
    Distribution of restricted cash from pollution control bonds
    
    
    44,550
    
    
    
    Nuclear decommissioning trust fund purchases
    
    
    (538,049
    )
    
    
    (572,932
    )Nuclear decommissioning trust fund sales
    
    
    531,169
    
    
    
    566,052Proceeds from property sales
    
    
    31,333
    
    
    
    148,427Investment in unconsolidated subsidiaries
    
    
    (34,550
    )
    
    
    (57,116
    )Cost of removal, net of salvage
    
    
    (65,601
    )
    
    
    (53,605
    )Hurricane Katrina capital grant proceeds
    
    
    10,869
    
    
    
    Other
    
    
    25,908
    
    
    
    (66,517
    )Net cash used for investing activities
    
    
    (2,559,482
    )
    
    
    (2,148,471
    )Financing Activities:Increase (decrease) in notes payable, net
    
    
    (656,348
    )
    
    
    788,744Proceeds Long-term debt
    
    
    3,081,500
    
    
    
    1,075,845Common stock
    
    
    414,498
    
    
    
    30,804Preferred and Preference Stock
    
    
    150,000
    
    
    
    Redemptions Long-term debt
    
    
    (904,270
    )
    
    
    (550,176
    )Long-term debt to affiliate trusts
    
    
    (695,376
    )
    
    
    (67,457
    )Preferred stock
    
    
    
    
    
    
    (14,569
    )Common stock repurchased
    
    
    
    
    
    
    (117
    )Payment of common stock dividends
    
    
    (898,766
    )
    
    
    (851,991
    )Other
    
    
    (31,432
    )
    
    
    (26,811
    )Net cash provided from financing activities
    
    
    459,806
    
    
    
    384,272Net Change in Cash and Cash Equivalents
    
    
    367,661
    
    
    
    215,986Cash and Cash Equivalents at Beginning of Period
    
    
    166,846
    
    
    
    202,111Cash and Cash Equivalents at End of Period
    
    $
    534,507
    
    
    $
    418,097Supplemental Cash Flow Information:Cash paid during the period for Interest (net of $44,229 and $16,604 capitalized for 2007 and 2006, respectively)
    
    $
    600,634
    
    
    $
    638,380Income taxes (net of refunds)
    
    $
    388,634
    
    
    $
    245,941
  7




---



##### Table of Contents



THE SOUTHERN COMPANY AND SUBSIDIARY COMPANIES
 
  At September 30,
    
    
    At December 31,Assets
    
    2007
    
    
    2006(in thousands)Current Assets:Cash and cash equivalents
    
    $
    534,507
    
    
    $
    166,846Restricted cash
    
    
    51,502
    
    
    
    Receivables Customer accounts receivable
    
    
    1,360,586
    
    
    
    942,821Unbilled revenues
    
    
    370,541
    
    
    
    283,275Under recovered regulatory clause revenues
    
    
    919,771
    
    
    
    516,441Other accounts and notes receivable
    
    
    318,377
    
    
    
    329,619Accumulated provision for uncollectible accounts
    
    
    (26,336
    )
    
    
    (34,901
    )Fossil fuel stock, at average cost
    
    
    732,345
    
    
    
    674,902Materials and supplies, at average cost
    
    
    701,243
    
    
    
    648,127Vacation pay
    
    
    123,505
    
    
    
    121,246Prepaid expenses
    
    
    167,974
    
    
    
    127,908Other
    
    
    181,839
    
    
    
    242,735Total current assets
    
    
    5,435,854
    
    
    
    4,019,019Property, Plant, and Equipment:In service
    
    
    46,565,693
    
    
    
    45,484,895Less accumulated depreciation
    
    
    17,213,524
    
    
    
    16,581,88629,352,169
    
    
    
    28,903,009Nuclear fuel, at amortized cost
    
    
    336,477
    
    
    
    317,429Construction work in progress
    
    
    2,896,405
    
    
    
    1,871,538Total property, plant, and equipment
    
    
    32,585,051
    
    
    
    31,091,976Other Property and Investments:Nuclear decommissioning trusts, at fair value
    
    
    1,146,615
    
    
    
    1,057,534Leveraged leases
    
    
    976,928
    
    
    
    1,138,730Other
    
    
    259,147
    
    
    
    296,484Total other property and investments
    
    
    2,382,690
    
    
    
    2,492,748Deferred Charges and Other Assets:Deferred charges related to income taxes
    
    
    932,382
    
    
    
    895,446Prepaid pension costs
    
    
    1,577,648
    
    
    
    1,548,983Unamortized debt issuance expense
    
    
    183,947
    
    
    
    171,758Unamortized loss on reacquired debt
    
    
    289,820
    
    
    
    293,016Deferred under recovered regulatory clause revenues
    
    
    354,548
    
    
    
    845,201Other regulatory assets
    
    
    912,102
    
    
    
    935,804Other
    
    
    654,172
    
    
    
    564,498Total deferred charges and other assets
    
    
    4,904,619
    
    
    
    5,254,706Total Assets
    
    $
    45,308,214
    
    
    $
    42,858,449
  8




---



##### Table of Contents



THE SOUTHERN COMPANY AND SUBSIDIARY COMPANIES
 At September 30,
    
    
    At December 31,Liabilities and Stockholders Equity
    
    2007
    
    
    2006(in thousands)Current Liabilities:Securities due within one year
    
    $
    1,721,312
    
    
    $
    1,416,898Notes payable
    
    
    1,284,453
    
    
    
    1,940,801Accounts payable
    
    
    1,102,793
    
    
    
    1,081,256Customer deposits
    
    
    269,420
    
    
    
    248,781Accrued taxes Income taxes
    
    
    363,065
    
    
    
    110,009Other
    
    
    423,928
    
    
    
    390,716Accrued interest
    
    
    199,325
    
    
    
    183,918Accrued vacation pay
    
    
    154,857
    
    
    
    151,113Accrued compensation
    
    
    299,306
    
    
    
    443,610Other
    
    
    298,181
    
    
    
    385,858Total current liabilities
    
    
    6,116,640
    
    
    
    6,352,960Long-term Debt
    
    
    13,404,668
    
    
    
    10,942,025Long-term Debt Payable to Affiliated Trusts
    
    
    412,372
    
    
    
    1,561,358Deferred Credits and Other Liabilities:Accumulated deferred income taxes
    
    
    5,853,662
    
    
    
    5,989,063Deferred credits related to income taxes
    
    
    278,043
    
    
    
    291,474Accumulated deferred investment tax credits
    
    
    485,259
    
    
    
    503,217Employee benefit obligations
    
    
    1,682,419
    
    
    
    1,566,591Asset retirement obligations
    
    
    1,184,590
    
    
    
    1,136,982Other cost of removal obligations
    
    
    1,318,417
    
    
    
    1,300,461Other regulatory liabilities
    
    
    893,507
    
    
    
    793,869Other
    
    
    565,054
    
    
    
    305,255Total deferred credits and other liabilities
    
    
    12,260,951
    
    
    
    11,886,912Total Liabilities
    
    
    32,194,631
    
    
    
    30,743,255Preferred and Preference Stock of Subsidiaries
    
    
    766,302
    
    
    
    744,065Common Stockholders Equity:Common stock, par value $5 per share Authorized  1 billion sharesIssued   September 30, 2007: 759,863,967 Shares;
       December 31, 2006: 751,863,854 SharesTreasury   September 30, 2007: 385,166 Shares;
           December 31, 2006: 5,593,691 SharesPar value
    
    
    3,799,320
    
    
    
    3,759,319Paid-in capital
    
    
    1,340,344
    
    
    
    1,096,387Treasury, at cost
    
    
    (10,571
    )
    
    
    (192,309
    )Retained earnings
    
    
    7,256,378
    
    
    
    6,765,219Accumulated other comprehensive loss
    
    
    (38,190
    )
    
    
    (57,487
    )Total Common Stockholders Equity
    
    
    12,347,281
    
    
    
    11,371,129Total Liabilities and Stockholders Equity
    
    $
    45,308,214
    
    
    $
    42,858,449
  9




---



##### Table of Contents



THE SOUTHERN COMPANY AND SUBSIDIARY COMPANIES
 
  For the Three Months
    
    
    For the Nine MonthsEnded September 30,
    
    
    Ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006(in thousands)
    
    
    (in thousands)Consolidated Net Income
    
    $
    761,995
    
    
    $
    737,985
    
    
    $
    1,529,837
    
    
    $
    1,384,815Other comprehensive income (loss):Qualifying hedges:Changes in fair value, net of tax of $(7,342), $(18,019), $6,087, and $(3,634), respectively
    
    
    (11,667
    )
    
    
    (28,556
    )
    
    
    9,704
    
    
    
    (5,645
    )Reclassification adjustment for amounts included in net income, net of tax of $1,548,
$(646), $4,227, and $(340), respectively
    
    
    2,369
    
    
    
    1,059
    
    
    
    6,770
    
    
    
    1,347Marketable securities:Change in fair value, net of tax of $1,094, $365, $2,998, and $4,772, respectively
    
    
    2,130
    
    
    
    866
    
    
    
    4,757
    
    
    
    7,721Reclassification adjustment for amounts included in net income, net of tax of $(127), $-,
$(488), and $-, respectively
    
    
    (201
    )
    
    
    
    
    
    
    (774
    )
    
    
    Pension and other post retirement benefit plans:Additional prior service costs from amendment to non-qualified pension plans, net of tax of
$-, $-, $(1,510), and $-, respectively
    
    
    
    
    
    
    
    
    
    
    (2,424
    )
    
    
    Reclassification adjustment for amounts included in net income, net of tax of $263, $-,
$790, and $-, respectively
    
    
    422
    
    
    
    
    
    
    
    1,264
    
    
    
    Total other comprehensive income (loss)
    
    
    (6,947
    )
    
    
    (26,631
    )
    
    
    19,297
    
    
    
    3,423COMPREHENSIVE INCOME
    
    $
    755,048
    
    
    $
    711,354
    
    
    $
    1,549,134
    
    
    $
    1,388,238
  10




---



##### Table of Contents



GEORGIA POWER COMPANY
 11




---



##### Table of Contents



GEORGIA POWER COMPANY
 
  For the Three Months
    
    
    For the Nine MonthsEnded September 30,
    
    
    Ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006(in thousands)
    
    
    (in thousands)Operating Revenues:Retail revenues
    
    $
    2,143,511
    
    
    $
    2,001,938
    
    
    $
    5,141,403
    
    
    $
    4,885,404Wholesale revenues Non-affiliates
    
    
    127,810
    
    
    
    135,647
    
    
    
    406,632
    
    
    
    404,014Affiliates
    
    
    107,451
    
    
    
    78,249
    
    
    
    208,065
    
    
    
    203,791Other revenues
    
    
    64,965
    
    
    
    59,471
    
    
    
    188,956
    
    
    
    173,746Total operating revenues
    
    
    2,443,737
    
    
    
    2,275,305
    
    
    
    5,945,056
    
    
    
    5,666,955Operating Expenses:Fuel
    
    
    786,021
    
    
    
    698,703
    
    
    
    2,030,745
    
    
    
    1,750,638Purchased power Non-affiliates
    
    
    168,358
    
    
    
    145,495
    
    
    
    282,121
    
    
    
    288,459Affiliates
    
    
    196,700
    
    
    
    186,669
    
    
    
    560,897
    
    
    
    572,642Other operations
    
    
    258,865
    
    
    
    258,055
    
    
    
    739,151
    
    
    
    744,858Maintenance
    
    
    129,812
    
    
    
    116,320
    
    
    
    391,070
    
    
    
    374,203Depreciation and amortization
    
    
    128,268
    
    
    
    125,352
    
    
    
    381,679
    
    
    
    372,850Taxes other than income taxes
    
    
    87,708
    
    
    
    82,701
    
    
    
    231,659
    
    
    
    227,431Total operating expenses
    
    
    1,755,732
    
    
    
    1,613,295
    
    
    
    4,617,322
    
    
    
    4,331,081Operating Income
    
    
    688,005
    
    
    
    662,010
    
    
    
    1,327,734
    
    
    
    1,335,874Other Income and (Expense):Allowance for equity funds used during construction
    
    
    17,846
    
    
    
    7,802
    
    
    
    45,712
    
    
    
    20,324Interest income
    
    
    1,436
    
    
    
    1,039
    
    
    
    2,543
    
    
    
    1,613Interest expense, net of amounts capitalized
    
    
    (81,796
    )
    
    
    (65,770
    )
    
    
    (225,457
    )
    
    
    (193,442
    )Interest expense to affiliate trusts
    
    
    (6,798
    )
    
    
    (14,878
    )
    
    
    (35,682
    )
    
    
    (44,633
    )Other income (expense), net
    
    
    11,291
    
    
    
    7,772
    
    
    
    7,376
    
    
    
    9,666Total other income and (expense)
    
    
    (58,021
    )
    
    
    (64,035
    )
    
    
    (205,508
    )
    
    
    (206,472
    )Earnings Before Income Taxes
    
    
    629,984
    
    
    
    597,975
    
    
    
    1,122,226
    
    
    
    1,129,402Income taxes
    
    
    229,862
    
    
    
    214,102
    
    
    
    401,046
    
    
    
    413,832Net Income
    
    
    400,122
    
    
    
    383,873
    
    
    
    721,180
    
    
    
    715,570Dividends on Preferred Stock
    
    
    689
    
    
    
    1,790
    
    
    
    2,067
    
    
    
    4,150Net Income After Dividends on Preferred Stock
    
    $
    399,433
    
    
    $
    382,083
    
    
    $
    719,113
    
    
    $
    711,420
 
  For the Three Months
    
    
    For the Nine MonthsEnded September 30,
    
    
    Ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006(in thousands)
    
    
    (in thousands)Net Income After Dividends on
Preferred Stock
    
    $
    399,433
    
    
    $
    382,083
    
    
    $
    719,113
    
    
    $
    711,420Other comprehensive income (loss):Qualifying hedges:Changes in fair value, net
of tax of $(4,686),
$(10,765), $5,044,
and $254, respectively
    
    
    (7,430
    )
    
    
    (17,066
    )
    
    
    7,996
    
    
    
    398Reclassification adjustment
for amounts included in net
income,
net of tax of $73, $(236),
$75, and $(194),
respectively
    
    
    116
    
    
    
    (373
    )
    
    
    120
    
    
    
    (308
    )Marketable securities:Change in fair value, net of
tax of $71, $(296), $107,
and $(459), respectively
    
    
    112
    
    
    
    (471
    )
    
    
    170
    
    
    
    (729
    )Total other comprehensive
income (loss)
    
    
    (7,202
    )
    
    
    (17,910
    )
    
    
    8,286
    
    
    
    (639
    )COMPREHENSIVE INCOME
    
    $
    392,231
    
    
    $
    364,173
    
    
    $
    727,399
    
    
    $
    710,781
  12




---



##### Table of Contents



GEORGIA POWER COMPANY
 
  For the Nine MonthsEnded September 30,2007
    
    
    2006(in thousands)Operating Activities:Net income
    
    $
    721,180
    
    
    $
    715,570Adjustments to reconcile net income
to net cash provided from operating activities Depreciation and amortization
    
    
    458,522
    
    
    
    439,197Deferred income taxes and investment tax credits
    
    
    34,267
    
    
    
    35,865Deferred expenses  affiliates
    
    
    (19,460
    )
    
    
    (19,721
    )Allowance for equity funds used during construction
    
    
    (45,712
    )
    
    
    (20,324
    )Pension, postretirement, and other employee benefits
    
    
    35,337
    
    
    
    32,140Other, net
    
    
    14,382
    
    
    
    4,989Changes in certain current assets and liabilities Receivables
    
    
    (211,971
    )
    
    
    (213,235
    )Fossil fuel stock
    
    
    1,827
    
    
    
    (76,805
    )Materials and supplies
    
    
    (22,605
    )
    
    
    (43,252
    )Prepaid income taxes
    
    
    42,047
    
    
    
    62,164Other current assets
    
    
    7,450
    
    
    
    (786
    )Accounts payable
    
    
    (1,122
    )
    
    
    (162,226
    )Accrued taxes
    
    
    25,779
    
    
    
    151,042Accrued compensation
    
    
    (62,643
    )
    
    
    (56,274
    )Other current liabilities
    
    
    31,179
    
    
    
    8,272Net cash provided from operating activities
    
    
    1,008,457
    
    
    
    856,616Investing Activities:Property additions
    
    
    (1,214,093
    )
    
    
    (781,134
    )Nuclear decommissioning trust fund purchases
    
    
    (336,526
    )
    
    
    (366,452
    )Nuclear decommissioning trust fund sales
    
    
    329,646
    
    
    
    359,572Cost of removal, net of salvage
    
    
    (28,811
    )
    
    
    (18,363
    )Change in construction payables, net of joint owner portion
    
    
    48,074
    
    
    
    (13,133
    )Other
    
    
    (11,553
    )
    
    
    (7,328
    )Net cash used for investing activities
    
    
    (1,213,263
    )
    
    
    (826,838
    )Financing Activities:Increase (decrease) in notes payable, net
    
    
    (166,951
    )
    
    
    371,480Proceeds Senior notes
    
    
    1,400,000
    
    
    
    Capital contributions from parent company
    
    
    270,250
    
    
    
    265,777Pollution control bonds
    
    
    
    
    
    
    125,845Redemptions Senior notes
    
    
    (300,000
    )
    
    
    (150,000
    )First mortgage bonds
    
    
    
    
    
    
    (20,000
    )Pollution control bonds
    
    
    
    
    
    
    (125,845
    )Capital leases
    
    
    (2,073
    )
    
    
    (270
    )Long-term debt to affiliate trusts
    
    
    (453,608
    )
    
    
    Preferred stock
    
    
    
    
    
    
    (14,569
    )Payment of preferred stock dividends
    
    
    (2,255
    )
    
    
    (2,126
    )Payment of common stock dividends
    
    
    (517,425
    )
    
    
    (472,500
    )Other
    
    
    (24,662
    )
    
    
    (1,621
    )Net cash provided from (used for) financing activities
    
    
    203,276
    
    
    
    (23,829
    )Net Change in Cash and Cash Equivalents
    
    
    (1,530
    )
    
    
    5,949Cash and Cash Equivalents at Beginning of Period
    
    
    16,850
    
    
    
    11,138Cash and Cash Equivalents at End of Period
    
    $
    15,320
    
    
    $
    17,087Supplemental Cash Flow Information:Cash paid during the period for Interest (net of $19,181 and $8,177 capitalized for 2007 and 2006, respectively)
    
    $
    229,282
    
    
    $
    226,368Income taxes (net of refunds)
    
    $
    254,742
    
    
    $
    177,486
  13




---



##### Table of Contents



GEORGIA POWER COMPANY
 
  At September 30,
    
    
    At December 31,Assets
    
    2007
    
    
    2006(in thousands)Current Assets:Cash and cash equivalents
    
    $
    15,320
    
    
    $
    16,850Receivables Customer accounts receivable
    
    
    670,600
    
    
    
    474,046Unbilled revenues
    
    
    188,036
    
    
    
    130,585Under recovered regulatory clause revenues
    
    
    526,227
    
    
    
    353,976Other accounts and notes receivable
    
    
    95,370
    
    
    
    93,656Affiliated companies
    
    
    49,521
    
    
    
    21,941Accumulated provision for uncollectible accounts
    
    
    (10,273
    )
    
    
    (10,030
    )Fossil fuel stock, at average cost
    
    
    390,183
    
    
    
    392,011Materials and supplies, at average cost
    
    
    326,938
    
    
    
    304,514Vacation pay
    
    
    62,306
    
    
    
    61,907Prepaid income taxes
    
    
    19,057
    
    
    
    61,104Other
    
    
    42,300
    
    
    
    85,725Total current assets
    
    
    2,375,585
    
    
    
    1,986,285Property, Plant, and Equipment:In service
    
    
    21,745,564
    
    
    
    21,279,792Less accumulated provision for depreciation
    
    
    8,614,032
    
    
    
    8,343,30913,131,532
    
    
    
    12,936,483Nuclear fuel, at amortized cost
    
    
    191,186
    
    
    
    180,129Construction work in progress
    
    
    1,559,280
    
    
    
    923,948Total property, plant, and equipment
    
    
    14,881,998
    
    
    
    14,040,560Other Property and Investments:Equity investments in unconsolidated subsidiaries
    
    
    61,706
    
    
    
    70,879Nuclear decommissioning trusts, at fair value
    
    
    597,089
    
    
    
    544,013Other
    
    
    36,883
    
    
    
    58,848Total other property and investments
    
    
    695,678
    
    
    
    673,740Deferred Charges and Other Assets:Deferred charges related to income taxes
    
    
    523,012
    
    
    
    510,531Prepaid pension costs
    
    
    709,115
    
    
    
    688,671Deferred under recovered regulatory clause revenues
    
    
    285,381
    
    
    
    544,152Other regulatory assets
    
    
    601,613
    
    
    
    629,003Other
    
    
    296,054
    
    
    
    235,788Total deferred charges and other assets
    
    
    2,415,175
    
    
    
    2,608,145Total Assets
    
    $
    20,368,436
    
    
    $
    19,308,730
  14




---



##### Table of Contents



GEORGIA POWER COMPANY
 At September 30,
    
    
    At December 31,Liabilities and Stockholder's Equity
    
    2007
    
    
    2006(in thousands)Current Liabilities:Securities due within one year
    
    $
    432,400
    
    
    $
    303,906Notes payable
    
    
    566,330
    
    
    
    733,281Accounts payable Affiliated
    
    
    239,813
    
    
    
    238,093Other
    
    
    439,132
    
    
    
    402,222Customer deposits
    
    
    169,317
    
    
    
    155,763Accrued taxes Income taxes
    
    
    183,303
    
    
    
    217,603Other
    
    
    236,235
    
    
    
    275,098Accrued interest
    
    
    87,135
    
    
    
    74,643Accrued vacation pay
    
    
    49,485
    
    
    
    49,704Accrued compensation
    
    
    82,897
    
    
    
    141,356Other
    
    
    98,974
    
    
    
    125,494Total current liabilities
    
    
    2,585,021
    
    
    
    2,717,163Long-term Debt
    
    
    5,517,043
    
    
    
    4,242,839Long-term Debt Payable to Affiliated Trusts
    
    
    206,186
    
    
    
    969,073Deferred Credits and Other Liabilities:Accumulated deferred income taxes
    
    
    2,891,790
    
    
    
    2,815,724Deferred credits related to income taxes
    
    
    149,349
    
    
    
    157,297Accumulated deferred investment tax credits
    
    
    272,361
    
    
    
    282,070Employee benefit obligations
    
    
    764,125
    
    
    
    698,274Asset retirement obligations
    
    
    654,295
    
    
    
    626,681Other cost of removal obligations
    
    
    428,084
    
    
    
    436,137Other regulatory liabilities
    
    
    268,606
    
    
    
    281,391Other
    
    
    139,556
    
    
    
    80,839Total deferred credits and other liabilities
    
    
    5,568,166
    
    
    
    5,378,413Total Liabilities
    
    
    13,876,416
    
    
    
    13,307,488Preferred Stock
    
    
    44,990
    
    
    
    44,991Common Stockholders Equity:Common stock, without par valueAuthorized - 20,000,000 sharesOutstanding - 9,261,500 shares
    
    
    398,473
    
    
    
    398,473Paid-in capital
    
    
    3,320,650
    
    
    
    3,039,845Retained earnings
    
    
    2,731,514
    
    
    
    2,529,826Accumulated other comprehensive loss
    
    
    (3,607
    )
    
    
    (11,893
    )Total common stockholders equity
    
    
    6,447,030
    
    
    
    5,956,251Total Liabilities and Stockholders Equity
    
    $
    20,368,436
    
    
    $
    19,308,730
  15




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR
THE SOUTHERN COMPANY AND SUBSIDIARY COMPANIES
GEORGIA POWER COMPANY
 
 Registrant
    
    Applicable NotesSouthern Company
    
    A, B, C, E, F, G, H, I, J, K, LGeorgia Power
    
    A, B, F, G, H, I, K, L
 16




---



##### Table of Contents



THE SOUTHERN COMPANY AND SUBSIDIARY COMPANIES
ALABAMA POWER COMPANY
GEORGIA POWER COMPANY
GULF POWER COMPANY
MISSISSIPPI POWER COMPANY
SOUTHERN POWER COMPANY AND SUBSIDIARY COMPANIES
 NOTES TO THE CONDENSED FINANCIAL STATEMENTS:
 (A)
    
    INTRODUCTIONThe condensed quarterly financial statements of the registrants included herein have been
prepared by each registrant, without audit, pursuant to the rules and regulations of the
SEC. The Condensed Balance Sheets as of December 31, 2006 have been derived from the
audited financial statements of each registrant. In the opinion of each registrants
management, the information regarding such registrant furnished herein reflects all
adjustments necessary to present fairly the results of operations for the periods ended
September 30, 2007 and 2006. Certain information and footnote disclosures normally included
in annual financial statements prepared in accordance with accounting principles generally
accepted in the United States have been condensed or omitted pursuant to such rules and
regulations, although each registrant believes that the disclosures regarding such
registrant are adequate to make the information presented not misleading. Disclosure which
would substantially duplicate the disclosure in the latest Form 10-K and details which have
not changed significantly in amount or composition since the filing of the Form 10-K are
omitted from this Quarterly Report on Form 10-Q. Therefore, these Condensed Financial
Statements should be read in conjunction with the financial statements and the notes thereto
included in the Form 10-K. Certain prior period amounts have been reclassified to conform
to current period presentation. Due to seasonal variations in the demand for energy,
operating results for the periods presented do not necessarily indicate operating results
for the entire year.SOUTHERN COMPANY AND GEORGIA POWER  BALANCE SHEET MISCLASSIFICATIONSubsequent to the filing of the Form 10-Q, Southern Company and Georgia Power identified a
misclassification in the condensed consolidated balance sheet of Southern Company and the
condensed balance sheet of Georgia Power included in Item 1 of the Form 10-Q, in that
$309,279 (in thousands) was incorrectly classified as Long-term Debt Payable to
Affiliated Trusts rather than Long-term Debt. In particular:
    
    In the condensed consolidated balance sheet of Southern Company included on page 11 of
the Form 10-Q, the line item Long-term Debt was shown as $13,095,389 (in thousands)
and should have been shown as $13,404,668 (in thousands) and the line item Long-term
Debt Payable to Affiliated Trusts was shown as $721,651 (in thousands) and should have
been shown as $412,372 (in thousands). These amounts have been corrected in the
condensed consolidated balance sheet of Southern Company included on page 9 of this
amendment.
    
    In the condensed balance sheet of Georgia Power included on page 59 of the Form 10-Q,
the line item Long-term Debt was shown as $5,207,764 (in thousands) and should have
been shown as $5,517,043 (in thousands) and the line item Long-term Debt Payable to
Affiliated Trusts was shown as $515,465 (in thousands) and should have been shown as
$206,186 (in thousands). These amounts have been corrected in the condensed balance
sheet of Georgia Power included on page 15 of this amendment.(B)
    
    CONTINGENCIES AND REGULATORY MATTERSSee Note 3 to the financial statements of Southern Company, the traditional operating companies,
and Southern Power in Item 8 of the Form 10-K for information relating to various lawsuits and
other contingencies.
 17




---



##### Table of Contents



NOTES
TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 ENVIRONMENTAL MATTERSNew Source Review LitigationSee Note 3 to the financial statements of Southern Company and Alabama Power under
Environmental Matters  New Source Review Actions in Item 8 of the Form 10-K for
additional information regarding civil actions brought by the EPA alleging that Alabama
Power had violated the NSR provisions of the Clean Air Act and related state laws with
respect to certain of its coal-fired generating facilities. The plaintiffs appeal against
Alabama Power was stayed by the U.S. Court of Appeals for the Eleventh Circuit pending the
U.S. Supreme Courts decision in a similar case against Duke Energy. On April 2, 2007, the
U.S. Supreme Court issued an opinion in the Duke Energy case. The U.S. District Court for
the Northern District of Alabama has issued an order indicating a willingness to re-evaluate
its previous decision in light of the Supreme Courts Duke Energy opinion. The Eleventh
Circuit is now considering whether to proceed with the appeal or remand the case to the
District Court for further proceedings, and if so, whether to vacate the District Courts
original judgment in favor of Alabama Power. The final resolution of these claims cannot be
determined at this time.Plant Wansley Environmental LitigationSee Note 3 to the financial statements of Southern Company and Georgia Power under
Environmental Matters  Plant Wansley Environmental Litigation in Item 8 of the Form 10-K
for additional information on litigation involving alleged violations of the Clean Air Act
at four of the units at Plant Wansley. On June 18, 2007, the U.S. District Court for the
Northern District of Georgia approved a settlement between the parties resolving all
remaining issues and dismissed the case. There was no material impact on the financial
statements of Southern Company or Georgia Power.Environmental RemediationDuring the second quarter 2007, Gulf Power increased its estimated liability for
environmental remediation projects by $12.8 million as a result of changes in the cost
estimates to remediate substation sites. These projects have been approved by the Florida
PSC for recovery through the environmental cost recovery clause; therefore, there was no
impact on Gulf Powers net income as a result of these revised estimates. See Note 3 to the
financial statements of Gulf Power under Environmental Matters  Environmental Remediation
in Item 8 of the Form 10-K for additional information.MIRANT MATTERSMirant was an energy company with businesses that included independent power projects and
energy trading and risk management companies in the U.S. and selected other countries. It
was a wholly-owned subsidiary of Southern Company until its initial public offering in
October 2000. In April 2001, Southern Company completed a spin-off to its shareholders of
its remaining ownership, and Mirant became an independent corporate entity. In July 2003,
Mirant filed for voluntary reorganization under Chapter 11 of the U.S. Bankruptcy Code. See
Note 3 to the financial statements of Southern Company under Mirant Matters  Mirant
Bankruptcy in Item 8 of the Form 10-K for information regarding Southern Companys
contingent liabilities associated with Mirant, including guarantees of contractual
commitments, litigation, and joint and several liabilities in connection with the
consolidated federal income tax return.MC Asset Recovery LitigationSee Note 3 to the financial statements of Southern Company under Mirant Matters  MC Asset
Recovery Litigation in Item 8 of the Form 10-K for information regarding a suit between MC
Asset
 18




---



##### Table of Contents



NOTES
TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 Recovery, a special purpose subsidiary of the post-bankruptcy corporation that adopted the
name Mirant Corporation, and Southern Company. On March 28, 2007, MC Asset Recovery filed a
Fourth Amended Complaint. Among other things, the Fourth Amended Complaint adds a claim
under the Federal Debt Collection Procedure Act (FDCPA) to avoid certain transfers from
Mirant to Southern Company and withdraws the breach of fiduciary duty claim the court struck
as a result of Southern Companys motion for summary judgment. MC Asset Recovery claims to
have standing to assert violations of the FDCPA and to recover property on behalf of the
Mirant debtors estates. The ultimate outcome of this matter cannot be determined at this
time.Mirant Securities LitigationSee Note 3 to the financial statements of Southern Company under Mirant Matters  Mirant
Securities Litigation in Item 8 of the Form 10-K for information regarding a class action
lawsuit that several Mirant shareholders (plaintiffs) originally filed against Mirant and
certain Mirant officers in May 2002. In November 2002, Southern Company, certain former and
current senior officers of Southern Company, and 12 underwriters of Mirants initial public
offering were added as defendants. On March 24, 2006, the plaintiffs filed a motion for
reconsideration requesting that the court vacate that portion of its July 14, 2003 order
dismissing the plaintiffs claims based upon Mirants alleged improper energy trading and
marketing activities involving the California energy market. On March 6, 2007, the court
granted plaintiffs motion for reconsideration, reinstated the California energy market
claims, and granted in part and denied in part defendants motion to compel certain class
certification discovery. On March 21, 2007, defendants filed renewed motions to dismiss the
California energy claims on grounds originally set forth in their 2003 motions to dismiss,
but which were not addressed by the court. On July 27, 2007, certain defendants, including
Southern Company, filed motions for reconsideration of the courts denial of a motion
seeking dismissal of certain federal securities laws claims based upon, among other things,
certain alleged errors included in financial statements issued by Mirant. The ultimate
outcome of this matter cannot be determined at this time.Southern Company Employee Savings Plan LitigationSee Note 3 to the financial statements of Southern Company under Mirant Matters  Southern
Company Employee Savings Plan Litigation in Item 8 of the Form 10-K for information related
to the pending settlement of a class action complaint filed under ERISA in June 2004, and
amended in December 2004 and November 2005, on behalf of a purported class of participants
in or beneficiaries of The Southern Company Employee Savings Plan at any time since April 2,
2001 and whose plan accounts included investments in Mirant common stock. On August 14,
2007, the U.S. District Court for the Northern District of Georgia issued a final order and
judgment approving the December 2006 settlement agreement. The deadline for appeal expired
with no appeal filed. There was no material impact on the financial statements of Southern
Company. This matter is now concluded.FERC MATTERSMarket-Based Rate AuthoritySee Note 3 to the financial statements of Southern Company, the traditional operating
companies and Southern Power under FERC Matters  Market-Based Rate Authority in Item 8 of
the Form 10-K for information regarding the proceedings initiated by the FERC in December
2004 to assess Southern Companys generation dominance within its retail service territory
and in May 2005 to determine whether Southern Company satisfies the other three parts of the
FERCs market-based rate analysis: transmission market power, barriers to entry, and
affiliate abuse or reciprocal dealing.In late June and July 2007, hearings were held in the December 2004 proceeding and briefs to
the presiding ALJ were filed in August and September. Southern Company anticipates an
initial decision
 19




---



##### Table of Contents



NOTES
TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 from the ALJ in November 2007 on the issues that were set for hearing. The ultimate outcome
of this generation dominance proceeding cannot now be determined, but an adverse decision by
the FERC in a final order could result in total refunds of approximately $19.7 million, plus
interest. The potential refunds include $3.9 million for Alabama Power, $5.8 million for
Georgia Power, $0.8 million for Gulf Power, $8.4 million for Mississippi Power, and $0.7
million for Southern Power, in each case plus interest.On June 21, 2007, the FERC issued an order terminating the May 2005 proceeding pertaining to
the other three parts of the market-based rate analysis. In addition, on June 21, 2007, the
FERC issued its final rule regarding market-based rate authority. The FERC generally
retained its current market-based rate standards. The impact of this order and its effect
on the generation dominance proceeding cannot now be determined.Intercompany Interchange ContractSee Note 3 to the financial statements of Southern Company, the traditional operating
companies and Southern Power under FERC Matters  Intercompany Interchange Contract in
Item 8 of the Form 10-K for information regarding the proceeding initiated by the FERC in
May 2005 to examine (1) the provisions of the IIC among Alabama Power, Georgia Power, Gulf
Power, Mississippi Power, Savannah Electric, Southern Power, and SCS, as agent, under the
terms of which the Power Pool is operated, and, in particular, the propriety of the
continued inclusion of Southern Power as a party to the IIC, (2) whether any parties to the
IIC have violated the FERCs standards of conduct applicable to utility companies that are
transmission providers, and (3) whether Southern Companys code of conduct defining Southern
Power as a system company rather than a marketing affiliate is just and reasonable.On April 19, 2007, the FERC approved, with certain modifications, the compliance filing
submitted by Southern Company on November 6, 2006. The compliance plan largely involves
functional separation and information restrictions related to marketing activities conducted
on behalf of Southern Power. Implementation of the plan is not expected to have a material
impact on the financial statements of Southern Company or the traditional operating
companies. Southern Powers cost of implementing the compliance plan, including the
modifications, is expected to average approximately $8 million annually.INCOME TAX MATTERSLeveraged Lease TransactionsSee Note 3 to the financial statements of Southern Company under Income Tax Matters in
Item 8 of the Form 10-K. The IRS challenged Southern Companys deductions related to three
international lease transactions (so-called SILO or sale-in-lease-out transactions), in
connection with its audits of Southern Companys 2000 through 2003 tax returns. In the
third quarter 2006, Southern Company paid the full amount of the disputed tax and the
applicable interest on the SILO issue for tax years 2000  2001 and filed a claim for refund
which has now been denied by the IRS. The disputed tax amount is $79 million and the related
interest is approximately $24 million for these tax years. This payment, and the subsequent
IRS disallowance of the refund claim, closed the issue with the IRS and Southern Company has
initiated litigation in the U.S. District Court for the Northern District of Georgia for a
complete refund of tax and interest paid for the 2000 and 2001 tax years. The estimated
amount of disputed tax and interest for tax years 2002 and 2003 is approximately $83 million
and $15 million, respectively. The tax and interest for these tax years was paid to the IRS
in the fourth quarter 2006. Southern Company has accounted for both payments in 2006 as
deposits. For tax years 2000 through 2006, Southern Company has claimed $284 million in tax
benefits related to these SILO transactions challenged by the IRS. The ultimate impact on
Southern Companys net income will be dependent on the outcome of pending litigation, but
could be significant, and potentially material. Southern Company believes these
transactions are valid leases for U.S. tax purposes and the related deductions are
allowable. Southern
 20




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
   
 Synthetic Fuel Tax Credits
  Georgia State Income Tax Credits
  21




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
  INTEGRATED GASIFICATION COMBINED CYCLE (IGCC) PROJECT
  PROPERTY TAX DISPUTE
  GULF POWER RIGHT OF WAY LITIGATION
  22




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 (C)
    
    SEGMENT AND RELATED INFORMATIONSouthern Companys reportable business segment is the sale of electricity in the Southeast
by the traditional operating companies and Southern Power. The All Other column includes
parent Southern Company, which does not allocate operating expenses to business segments.
Also, this category includes segments below the quantitative threshold for separate
disclosure. These segments include investments in synthetic fuels and leveraged lease
projects, telecommunications, and energy-related services. Southern Powers revenues from
sales to the traditional operating companies were $185 million and $439 million for the
three months and nine months ended September 30, 2007, respectively, and $164 million and
$381 million for the three months and nine months ended September 30, 2006, respectively.
All other intersegment revenues are not material. Financial data for business segments and
products and services are as follows:
 Electric UtilitiesTraditionalOperating
    
    
    
    
    
    
    
    
    
    
    
    
    
    AllCompanies
    
    Southern Power
    
    Eliminations
    
    Total
    
    Other
    
    Eliminations
    
    Consolidated(in millions)Three Months Ended September 30, 2007:Operating revenues
    
    $
    4,660
    
    
    $
    347
    
    
    $
    (227
    )
    
    $
    4,780
    
    
    $
    95
    
    
    $
    (43
    )
    
    $
    4,832Segment net income (loss)
    
    
    714
    
    
    
    51
    
    
    
    
    
    
    
    765
    
    
    
    (4
    )
    
    
    1
    
    
    
    762Nine Months Ended September 30, 2007:Operating revenues
    
    $
    11,612
    
    
    $
    784
    
    
    $
    (549
    )
    
    $
    11,847
    
    
    $
    294
    
    
    $
    (128
    )
    
    $
    12,013Segment net income (loss)
    
    
    1,381
    
    
    
    123
    
    
    
    
    
    
    
    1,504
    
    
    
    26
    
    
    
    
    
    
    
    1,530Total assets at September 30, 2007
    
    $
    41,210
    
    
    $
    2,840
    
    
    $
    (196
    )
    
    $
    43,854
    
    
    $
    1,889
    
    
    $
    (435
    )
    
    $
    45,308
 Electric UtilitiesTraditionalOperating
    
    
    
    
    
    
    
    
    
    
    
    
    
    AllCompanies
    
    Southern Power
    
    Eliminations
    
    Total
    
    Other
    
    Eliminations
    
    Consolidated(in millions)Three Months Ended September 30, 2006:Operating revenues
    
    $
    4,422
    
    
    $
    270
    
    
    $
    (213
    )
    
    $
    4,479
    
    
    $
    106
    
    
    $
    (36
    )
    
    $
    4,549Segment net income (loss)
    
    
    691
    
    
    
    46
    
    
    
    
    
    
    
    737
    
    
    
    1
    
    
    
    
    
    
    
    738Nine Months Ended September 30, 2006:Operating revenues
    
    $
    10,875
    
    
    $
    603
    
    
    $
    (475
    )
    
    $
    11,003
    
    
    $
    313
    
    
    $
    (112
    )
    
    $
    11,204Segment net income (loss)
    
    
    1,292
    
    
    
    98
    
    
    
    
    
    
    
    1,390
    
    
    
    (5
    )
    
    
    
    
    
    
    1,385Total assets at December 31, 2006
    
    $
    38,825
    
    
    $
    2,691
    
    
    $
    (110
    )
    
    $
    41,406
    
    
    $
    1,933
    
    
    $
    (481
    )
    
    $
    42,858
 Products and Services
 Electric Utilities RevenuesRetail
    
    Wholesale
    
    Other
    
    TotalPeriod
    
    (in millions)Three Months Ended September 30, 2007
    
    $
    4,086
    
    
    $
    563
    
    
    $
    131
    
    
    $
    4,780Three Months Ended September 30, 2006
    
    
    3,853
    
    
    
    506
    
    
    
    120
    
    
    
    4,479Nine Months Ended September 30, 2007
    
    $
    9,935
    
    
    $
    1,531
    
    
    $
    381
    
    
    $
    11,847Nine Months Ended September 30, 2006
    
    
    9,295
    
    
    
    1,361
    
    
    
    347
    
    
    
    11,003
 (D)
    
    MISSISSIPPI POWER RETAIL REGULATORY MATTERSSee Note 3 to the financial statements of Mississippi Power under Retail Regulatory Matters
 Environmental Compliance Overview Plan in Item 8 of the Form 10-K for information on
Mississippi Powers annual environmental filing with the Mississippi PSC. In February 2007,
Mississippi Power filed with the Mississippi PSC its annual ECO Plan evaluation for 2007.
Mississippi Power requested an average increase for retail customers of 86 cents per 1,000
KWH. This increase represents approximately $7.5 million in annual revenues for Mississippi
Power. On April 13, 2007, the Mississippi PSC approved Mississippi Powers ECO Plan as
filed. The new rates became effective in May 2007.
 23




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
      24




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
   (E)
    
    COMMON STOCK
 
 Average Common Stock SharesThree Months
    
    Three Months
    
    Nine Months
    
    Nine MonthsEnded
    
    Ended
    
    Ended
    
    EndedSeptember 30,
    
    September 30,
    
    September 30,
    
    September 30,2007
    
    2006
    
    2007
    
    2006As reported shares
    
    
    758,308
    
    
    
    742,884
    
    
    
    754,568
    
    
    
    742,532Effect of options
    
    
    4,084
    
    
    
    4,676
    
    
    
    4,614
    
    
    
    4,451Diluted shares
    
    
    762,392
    
    
    
    747,560
    
    
    
    759,182
    
    
    
    746,983
  25




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 (F)
    
    FINANCIAL INSTRUMENTS
  Southern
    
    Alabama
    
    Georgia
    
    Gulf
    
    Mississippi
    
    SouthernCompany
    
    Power
    
    Power
    
    Power
    
    Power
    
    PowerRegulatory (assets)/
liabilities, net
    
    $
    (21.7
    )
    
    $
    (8.0
    )
    
    $
    (11.1
    )
    
    $
    (2.0
    )
    
    $
    (0.6
    )
    
    $
    Accumulated other
comprehensive
income (loss)
    
    
    0.5
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.6
    
    
    
    (0.1
    )Net income (loss)
    
    
    (0.4
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    (0.5
    )Total fair value
    
    $
    (21.6
    )
    
    $
    (8.0
    )
    
    $
    (11.1
    )
    
    $
    (2.0
    )
    
    $
    0.1
    
    
    $
    (0.6
    )
    26




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
  Cash Flow Hedges
 Weighted
    
    
    
    Fair ValueVariable
    
    Average
    
    Hedge
    
    Gain (Loss)Notional
    
    Rate
    
    Fixed Rate
    
    Maturity
    
    September 30, 2007Amount
    
    Received
    
    Paid
    
    Date
    
    (in millions)Alabama Power*
    
    $100 million
    
    3-month LIBOR
    
    
    6.15
    %
    
    November 2017
    
    $
    (1.1
    )Alabama Power**
    
    $100 million
    
    3-month LIBOR
    
    
    6.15
    %
    
    December 2017
    
    
    (1.3
    )Georgia Power***
    
    $400 million
    
    Floating
    
    
    3.85
    %
    
    December 2007
    
    
    (0.0
    )Georgia Power
    
    $225 million
    
    3-month LIBOR
    
    
    5.26
    %
    
    March 2018
    
    
    (0.6
    )Georgia Power
    
    $100 million
    
    3-month LIBOR
    
    
    5.12
    %
    
    June 2018
    
    
    1.0Georgia Power
    
    $14 million
    
    BMA Index
    
    
    2.50
    %
    
    December 2007
    
    
    0.1Georgia Power
    
    $50 million
    
    3-month LIBOR
    
    
    5.37
    %
    
    February 2019
    
    
    (0.1
    )Gulf Power
    
    $80 million
    
    3-month LIBOR
    
    
    5.10
    %
    
    July 2018
    
    
    1.0
 
 *
    
    Interest rate collar showing rate cap**
    
    Interest rate collar showing rate cap. Subsequent to September 30, 2007, this hedge was
terminated.***
    
    Interest rate collar with variable rate based on one-month LIBOR (showing rate cap)   Southern Company
    
    $
    (15.4
    )Alabama Power
    
    
    (0.2
    )Georgia Power
    
    
    (1.7
    )Gulf Power
    
    
    (0.5
    )Southern Power
    
    
    (13.0
    )
 27




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 (G)
    
    RETIREMENT BENEFITSSee Note 2 to the financial statements of Southern Company, Alabama Power, Georgia Power,
Gulf Power, and Mississippi Power in Item 8 of the Form 10-K. Components of the pension
plans and postretirement plans net periodic costs for the three- and nine-month periods
ended September 30, 2007 and 2006 are as follows (in millions):
 Southern
    
    Alabama
    
    Georgia
    
    Gulf
    
    MississippiPENSION PLANS
    
    Company
    
    Power
    
    Power
    
    Power
    
    PowerThree Months EndedSeptember 30, 2007Service cost
    
    $
    37
    
    
    $
    9
    
    
    $
    13
    
    
    $
    2
    
    
    $
    2Interest cost
    
    
    81
    
    
    
    20
    
    
    
    31
    
    
    
    4
    
    
    
    4Expected return on plan assets
    
    
    (120
    )
    
    
    (36
    )
    
    
    (49
    )
    
    
    (5
    )
    
    
    (5
    )Net amortization
    
    
    12
    
    
    
    3
    
    
    
    5
    
    
    
    
    
    
    
    Net cost (income)
    
    $
    10
    
    
    $
    (4
    )
    
    $
    
    
    
    $
    1
    
    
    $
    1Nine Months EndedSeptember 30, 2007Service cost
    
    $
    110
    
    
    $
    26
    
    
    $
    38
    
    
    $
    5
    
    
    $
    5Interest cost
    
    
    242
    
    
    
    61
    
    
    
    94
    
    
    
    11
    
    
    
    11Expected return on plan assets
    
    
    (361
    )
    
    
    (109
    )
    
    
    (146
    )
    
    
    (16
    )
    
    
    (14
    )Net amortization
    
    
    34
    
    
    
    9
    
    
    
    13
    
    
    
    1
    
    
    
    1Net cost (income)
    
    $
    25
    
    
    $
    (13
    )
    
    $
    (1
    )
    
    $
    1
    
    
    $
    3Three Months EndedSeptember 30, 2006Service cost
    
    $
    38
    
    
    $
    9
    
    
    $
    13
    
    
    $
    2
    
    
    $
    2Interest cost
    
    
    75
    
    
    
    19
    
    
    
    29
    
    
    
    3
    
    
    
    3Expected return on plan assets
    
    
    (113
    )
    
    
    (34
    )
    
    
    (46
    )
    
    
    (5
    )
    
    
    (4
    )Net amortization
    
    
    10
    
    
    
    3
    
    
    
    4
    
    
    
    
    
    
    
    Net cost (income)
    
    $
    10
    
    
    $
    (3
    )
    
    $
    
    
    
    $
    
    
    
    $
    1Nine Months EndedSeptember 30, 2006Service cost
    
    $
    114
    
    
    $
    28
    
    
    $
    40
    
    
    $
    5
    
    
    $
    5Interest cost
    
    
    225
    
    
    
    57
    
    
    
    88
    
    
    
    10
    
    
    
    10Expected return on plan assets
    
    
    (341
    )
    
    
    (104
    )
    
    
    (138
    )
    
    
    (15
    )
    
    
    (14
    )Net amortization
    
    
    32
    
    
    
    9
    
    
    
    10
    
    
    
    1
    
    
    
    2Net cost (income)
    
    $
    30
    
    
    $
    (10
    )
    
    $
    
    
    
    $
    1
    
    
    $
    3
 28




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 Southern
    
    Alabama
    
    Georgia
    
        Gulf
    
    
    MississippiPOSTRETIREMENT PLANS
    
    Company
    
    Power
    
    Power
    
    Power
    
    PowerThree Months EndedSeptember 30, 2007Service cost
    
    $
    6
    
    
    $
    1
    
    
    $
    3
    
    
    $
    
    
    
    $
    Interest cost
    
    
    27
    
    
    
    7
    
    
    
    12
    
    
    
    1
    
    
    
    2Expected return on plan assets
    
    
    (13
    )
    
    
    (4
    )
    
    
    (7
    )
    
    
    
    
    
    
    Net amortization
    
    
    9
    
    
    
    2
    
    
    
    4
    
    
    
    
    
    
    
    Net cost (income)
    
    $
    29
    
    
    $
    6
    
    
    $
    12
    
    
    $
    1
    
    
    $
    2Nine Months EndedSeptember 30, 2007Service cost
    
    $
    20
    
    
    $
    5
    
    
    $
    8
    
    
    $
    1
    
    
    $
    1Interest cost
    
    
    80
    
    
    
    21
    
    
    
    35
    
    
    
    3
    
    
    
    4Expected return on plan assets
    
    
    (39
    )
    
    
    (14
    )
    
    
    (20
    )
    
    
    (1
    )
    
    
    (1
    )Net amortization
    
    
    29
    
    
    
    8
    
    
    
    14
    
    
    
    1
    
    
    
    1Net cost (income)
    
    $
    90
    
    
    $
    20
    
    
    $
    37
    
    
    $
    4
    
    
    $
    5Three Months EndedSeptember 30, 2006Service cost
    
    $
    7
    
    
    $
    2
    
    
    $
    3
    
    
    $
    
    
    
    $
    Interest cost
    
    
    24
    
    
    
    6
    
    
    
    11
    
    
    
    1
    
    
    
    1Expected return on plan assets
    
    
    (12
    )
    
    
    (4
    )
    
    
    (6
    )
    
    
    
    
    
    
    Net amortization
    
    
    11
    
    
    
    3
    
    
    
    5
    
    
    
    
    
    
    
    Net cost (income)
    
    $
    30
    
    
    $
    7
    
    
    $
    13
    
    
    $
    1
    
    
    $
    1Nine Months EndedSeptember 30, 2006Service cost
    
    $
    22
    
    
    $
    6
    
    
    $
    8
    
    
    $
    1
    
    
    $
    1Interest cost
    
    
    74
    
    
    
    20
    
    
    
    33
    
    
    
    3
    
    
    
    4Expected return on plan assets
    
    
    (36
    )
    
    
    (13
    )
    
    
    (19
    )
    
    
    (1
    )
    
    
    (1
    )Net amortization
    
    
    32
    
    
    
    8
    
    
    
    17
    
    
    
    1
    
    
    
    1Net cost (income)
    
    $
    92
    
    
    $
    21
    
    
    $
    39
    
    
    $
    4
    
    
    $
    5
 (H)
    
    EFFECTIVE TAX RATESSouthern Companys effective tax rate was 34.1% for the nine months ended September 30,
2007, as compared to 34.2% for the same period in 2006. The effective tax rate decreased
due to additional AFUDC equity recorded by Georgia Power and Gulf Power and by the increase
in the IRC Section 199 domestic production deduction. These decreases were offset by a
reduction in synthetic fuel tax credits net of reserves. See Note 5 to the financial
statements of Southern Company, Georgia Power, and Gulf Power in Item 8 of the Form 10-K for
information on each companys effective income tax rate.In connection with its construction program, Georgia Power recorded an increase of
approximately $25.4 million in AFUDC equity, which is not taxable, during the nine months
ended September 30, 2007, as compared to the prior year. Georgia Power also recorded
certain federal deductions and state income tax credits, which together with the increased
AFUDC equity, resulted in a lower effective income tax rate of 35.7% for the nine months
ended September 30, 2007 when compared to 36.6% in the same period in 2006. See Note (B)
herein for additional information regarding the pending litigation associated with the state
tax credits.In connection with its construction program, Gulf Power recorded an increase of
approximately $1.3 million in AFUDC equity, which is not taxable, during the nine months
ended September 30, 2007, as compared to the prior year. Gulf Power also had an increase in
the deduction created by the American Jobs Creation Act of 2004 as discussed below, which
together with the increased AFUDC equity,
 29




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 resulted in a lower effective income tax rate of 36.6% for the nine months ended September
30, 2007 when compared to 37.5% in the same period in 2006.The American Jobs Creation Act of 2004 created a tax deduction for the portion of income
attributable to United States production activities as defined in IRC Section 199. The
deduction is equal to a stated percentage of the taxpayers qualified production activities.
The percentage is phased in over the years 2005 through 2010 with a 3% rate applicable to
the years 2005 and 2006, a 6% rate applicable for years 2007 through 2009, and a 9% rate
applicable for all years after 2009. This increase from 3% in 2006 to 6% in 2007 resulted
in an additional $13 million in tax deductions in 2007 compared to 2006.Southern Company recorded net synthetic fuel tax credits as of the nine months ended
September 30, 2007 that are $16.2 million less than the net synthetic fuel tax credits
recorded for the same period in 2006. See Note (B) herein for additional information
regarding the production of synthetic fuel tax credits in 2007. The impact of the reduction
in net synthetic fuel tax credits is an increase in Southern Companys effective tax rate
for the nine months ended September 30, 2007 as compared to the same period in 2006.(I)
    
    ADOPTION OF FIN 48On January 1, 2007, Southern Company, the traditional operating companies, and Southern
Power adopted FIN 48, which requires companies to determine whether it is more likely than
not that a tax position will be sustained upon examination by the appropriate taxing
authorities before any part of the benefit can be recorded in the financial statements. It
also provides guidance on the recognition, measurement, and classification of income tax
uncertainties, along with any related interest and penalties. Prior to adoption of FIN 48,
Southern Company had unrecognized tax benefits of approximately $65 million, which included
approximately $62 million for Georgia Power. As of adoption, an additional $146 million of
unrecognized tax benefits were recorded, which resulted in a total balance of $211 million.
The $146 million is associated with a tax timing difference which was recorded by
reclassifying a deferred tax liability to an unrecognized tax benefit. Of the total $211
million unrecognized tax benefits, $65 million would impact Southern Companys effective tax
rate if recognized, which includes $62 million for Georgia Power. For the first nine months
of 2007, the total amount of unrecognized tax benefits increased by $39.7 million, resulting
in a balance of $250.7 million as of September 30, 2007. Of the $39.7 million increase in
unrecognized tax benefits, $23.1 million would impact Southern Companys effective tax rate
if recognized.Southern Company classifies interest on tax uncertainties as interest expense. The net
amount of interest accrued as of adoption was $24 million, which resulted in a reduction to
beginning 2007 retained earnings of approximately $15 million, net of tax. The other
registrants retained earnings balances were not impacted by the adoption of FIN 48. Net
interest accrued for the FIN 48 liability as of September 30, 2007 was $30.3 million.Southern Company files a consolidated federal income tax return. The IRS has audited and
closed all tax returns prior to 2004. Southern Company also files income tax returns in
various states. The audits for these returns have either been concluded, or the statute of
limitations has expired, for years prior to 2002.It is reasonably possible that the amount of the unrecognized benefit with respect to
certain of Southern Companys unrecognized tax positions will significantly increase or
decrease within the next twelve months. The possible settlement of the SILO litigation
or the Georgia state tax credits litigation or the conclusion or settlement of federal or
state audits could impact the balances significantly. At this time, an estimate of the
range of reasonably possible outcomes cannot be determined. See Note (B) herein for
additional information regarding the implementation of FIN 48 and current litigation
concerning deductions related to the SILO transactions and the Georgia state tax credits.
 30




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 (J)
    
    ALABAMA POWER RETAIL REGULATORY MATTERSAlabama Power has established fuel cost recovery rates approved by the Alabama PSC. Alabama
Powers under recovered fuel costs as of September 30, 2007 totaled $307 million as compared
to $301 million at December 31, 2006. As a result of the increasing level of under
recovered fuel costs, on June 18, 2007, the Alabama PSC ordered Alabama Power to increase
its Rate ECR factor to 3.1 cents per KWH from 2.4 cents per KWH, effective with billings
beginning July 2007 for the 30-month period ending December 2009. This change represents on
average an increase of approximately $7.37 per month for a customer billing of 1,000 KWH.
This increase is intended to permit the recovery of energy costs based on an estimate of
future energy costs, as well as the collection of the existing under recovered energy costs
by the end of 2009. During the 30-month period, Alabama Power will be allowed to include a
carrying charge associated with the under recovered fuel costs in the fuel expense
calculation. In the event the application of this increased Rate ECR factor results in an
over recovered position during this period, Alabama Power will pay interest on any such over
recovered balance at the same rate used to derive the carrying costs. As a result of the
order, Alabama Power classified $69 million of the under recovered regulatory clause
receivable as deferred charges and other assets in the Condensed Balance Sheet as of
September 30, 2007 herein.As of December 31, 2006, Alabama Power had a deficit balance in the deferred natural
disaster reserve account of approximately $16.8 million. In June 2007, Alabama Power fully
recovered its prior storm costs related to Hurricanes Dennis and Katrina. As a result
customer rates decreased by $1.73 per month per residential customer account and $4.29 per
month per non-residential customer account beginning with July 2007 billings. Alabama Power
continues to collect a monthly Rate NDR charge to establish and maintain a target reserve
balance of $75 million for future storms. At September 30, 2007, Alabama Power had
accumulated a balance of $23.1 million in the target reserve for future storms, which is
included in the balance sheets under Other Regulatory Liabilities. See Note 3 to the
financial statements of Alabama Power under Retail Regulatory Matters  Natural Disaster
Cost Recovery in Item 8 of the Form 10-K for additional information.(K)
    
    GEORGIA POWER RETAIL REGULATORY MATTERSGeorgia Power is currently operating under a three-year retail rate order that expires
December 31, 2007. Under the terms of the existing order, earnings are evaluated annually
against a retail return on common equity range of 10.25% to 12.25%. Two-thirds of any
earnings above the 12.25% return are applied to rate refunds, with the remaining one-third
retained by Georgia Power. The order required Georgia Power to file a general rate case by
July 1, 2007.On June 29, 2007, Georgia Power filed a request to increase retail base rates with the
Georgia PSC. The request includes an increase effective January 1, 2008 of approximately
$406 million, or 5.98%, in retail revenues, based on a future test year ending July 31, 2008
and a proposed retail return on common equity of 12.5%. The majority of the increase in
retail revenues is being requested to cover the costs of environmental compliance and
continued investment in new generation, transmission, and distribution facilities to support
growth and ensure reliability. The remainder of the increase would include recovery of
higher operations, maintenance, and other investment costs to meet the rising demand for
electricity. Hearings on Georgia Powers direct testimony were held in early October. In
direct testimony filed on October 22, 2007, the Georgia PSC staff proposed certain
adjustments to Georgia Powers general rate case that indicates a $21 million revenue
surplus. Georgia Power disagrees with the majority of the staffs proposed adjustments.
Hearings on Georgia PSC staffs and intervenors direct testimony will be held in early
November. Georgia Powers rebuttal hearings will occur later the same month. Georgia Power
expects the Georgia PSC to issue a final order in this matter on December 20, 2007. In
addition to the traditional test period request, Georgia Power filed information for a
three-year rate plan option that includes additional increases of approximately $189
million, or 2.62%, and $41 million, or 0.56%, in retail revenues effective January 1, 2009
and 2010, respectively, to cover the costs of additional
environmental controls and certified PPAs. The final outcome of this matter cannot now be
determined. See Note 3 to the financial statements of Southern Company and Georgia Power
under Georgia Power
 31




---



##### Table of Contents



NOTES TO THE CONDENSED FINANCIAL STATEMENTS: (Continued)
 Retail Regulatory Matters and Retail Regulatory Matters  Rate Plans, respectively, in
Item 8 of the Form 10-K for additional information.(L)
    
    NUCLEAR FUEL DISPOSAL COST LITIGATIONSee Note 1 to the financial statements of Southern Company, Alabama Power, and Georgia
Power under Nuclear Fuel Disposal Costs in Item 8 of the Form 10-K for information
regarding the litigation brought by Alabama Power and Georgia Power against the
government for breach of contracts related to the disposal of spent nuclear fuel. On
July 9, 2007, the U.S. Court of Federal Claims awarded Georgia Power a total of $30
million, based on its ownership interests, and awarded Alabama Power $17.3 million,
representing all of the direct costs of the expansion of spent nuclear fuel storage
facilities from 1998 through 2004. In August 2007, the government filed a motion for
reconsideration, which was denied on November 1, 2007. The government has 60 days in
which to file an appeal. The final outcome of this matter cannot be determined at this
time, but no material impact on net income is expected. No amounts have been recognized
in the financial statements as of September 30, 2007.
 32




---



##### Table of Contents



EXHIBIT INDEX
 (31) Section 302 Certifications
 Southern Company(a)1
    
    -
    
    Certificate of Southern Companys Chief
Executive Officer required by Section 302 of
the Sarbanes-Oxley Act of 2002.(a)2
    
    -
    
    Certificate of Southern Companys Chief
Financial Officer required by Section 302 of
the Sarbanes-Oxley Act of 2002.Georgia Power(c)1
    
    -
    
    Certificate of Georgia Powers Chief
Executive Officer required by Section 302 of
the Sarbanes-Oxley Act of 2002.(c)2
    
    -
    
    Certificate of Georgia Powers Chief
Financial Officer required by Section 302 of
the Sarbanes-Oxley Act of 2002.(32) Section 906 CertificationsSouthern Company(a)
    
    -
    
    Certificate of Southern Companys Chief
Executive Officer and Chief Financial Officer
required by Section 906 of the Sarbanes-Oxley
Act of 2002.Georgia Power(c)
    
    -
    
    Certificate of Georgia Powers Chief Executive Officer and
Chief Financial Officer required by Section 906 of the
Sarbanes-Oxley Act of 2002.
 33




---



##### Table of Contents



THE SOUTHERN COMPANY
 
 SIGNATURES
  THE SOUTHERN COMPANYBy
    
    David M. RatcliffeChairman, President and Chief Executive Officer(Principal Executive Officer)By
    
    Thomas A. FanningExecutive Vice President and Chief Financial Officer(Principal Financial Officer)By
    
    /s/ Wayne Boston(Wayne Boston, Attorney-in-fact)
  34




---



##### Table of Contents



GEORGIA POWER COMPANY
 SIGNATURES
  GEORGIA POWER COMPANYBy
    
    Michael D. GarrettPresident and Chief Executive Officer(Principal Executive Officer)By
    
    Cliff S. ThrasherExecutive Vice President, Chief Financial Officer and Treasurer(Principal Financial Officer)By
    
    /s/ Wayne Boston(Wayne Boston, Attorney-in-fact)
  35