Southern Company (SO -1.68%) reported its second quarter 2025 earnings on July 31, 2025, announcing a $13 billion increase in its five-year base capital plan to $76 billion. The company highlighted approximately 10 gigawatts (GW) of new generation requests under review as of the second quarter of 2025.
Additionally, management announced a potential $5 billion further in capital investment through 2029, and disciplined funding actions to support a 17% FFO-to-debt target in the latter part of the forecast horizon. Key strategic milestones and updated forward guidance signal enhanced long-term visibility and risk-adjusted investment opportunities.
Regulatory settlement anchors rate base
Georgia Power reached a unique settlement extending its alternate rate plan, nullifying the need for a 2025 base rate case filing and anchoring regulatory predictability for the next three years. This agreement establishes customer affordability while enabling the company to proceed with aggressive long-term capital deployment within a stable regulatory environment.
"The stipulated agreement, which was unanimously approved by the Georgia Public Service Commission, extends Georgia Power's 2022 alternate rate plan, ultimately precluding the need for a 2025 base rate case filing and keeping base rates stable and predictable over the next three years through February 19, 2028."
— Chris Womack, Chairman, President, and CEO
By securing multi-year rate stability and eliminating near-term regulatory risk, Southern Company positions itself to deliver consistent returns while capturing robust projected economic growth within its Georgia franchise, providing a foundation for sustainable earnings and capital investment expansion across its territory.
Raises capital plan to $76 billion
The $13 billion increase in the five-year base capital plan to $76 billion was driven by approval of the Georgia Power 2025 Integrated Resource Plan (IRP) and related generation filings. Internal equity plans, along with $1.2 billion in at-the-market (ATM) equity issuances since the prior earnings call, have proactively supported capital structure resilience.
"With the approval of Georgia Power's 2025 IRP, along with the certification filings for new resources, we now have improved line of sight on our expected capital opportunities and are adding $12 billion of state-regulated capital into our five-year base capital plan. In total, our five-year base capital plan has increased $13 billion from $63 billion to $76 billion, with potential upside of approximately $5 billion still pending tied to the generation procurement certifications in Georgia and potential FERC-regulated gas pipeline expansions at Southern Company Gas."
— David Poroch, CFO
The ability to flex capital deployment in line with state approvals and load growth, while maintaining strong credit metrics and managing equity needs, supports long-term earnings growth potential and positions Southern Company to capture additional regulated and nonregulated opportunities as demand increases.
Customer load growth pipeline drives upside potential
The company maintains a pipeline of over 50 GW of potential customer load, as discussed on the second quarter 2025 earnings call, with continued robust activity from hyperscale customers and data centers across Georgia, Alabama, and Mississippi. Southern Company’s commitment to disciplined, risk-adjusted contract terms aims to preserve customer benefits and financial flexibility.
"we still see that 50 gigawatt pipeline continuing to grow. And we continue to see just incredible amounts of activity. And as you see hyperscale capital budgets continuing to grow, I mean, we just keep seeing these huge numbers. We see corresponding activity. And so we're in conversations with all of the majors, all the hyperscalers. And having what I would call very advanced discussions."
— Chris Womack, Chairman, President, and CEO
The company’s steadfast approach to contracting and risk management amid rapidly increasing customer load enables it to selectively translate pipeline growth into rate base and earnings, mitigating potential volatility and preserving credit quality.
Looking ahead
Management affirmed that updated projections for customer load will be filed with the Georgia Public Service Commission in mid-August, with final certification of up to 10 GW of new resources expected later this year.
The company reiterated its long-term earnings per share (EPS) growth target of 5% to 7%, with potential for a higher rebased growth rate as early as 2027 if demand proves sustainable. No explicit changes to financial guidance or dividend outlook were provided in the transcript, but annual financial plan updates remain on track for the fourth quarter of 2025.
