Executive Summary / Key Takeaways

• Strategic Growth Fueled by Demand: Georgia Power is experiencing significant demand growth, particularly from data centers and industrial expansion, driving robust retail and wholesale revenue increases. The company projects an 8,448 MW growth in demand between winter 2025/2026 and 2030/2031, supporting substantial capital investments in new capacity.
• Diverse and Modernized Energy Portfolio: The company is strategically investing in a diverse energy mix, including advanced nuclear (Plant Vogtle Units 3 & 4), significant battery energy storage (765 MW operational, over 1,500 MW planned), and renewable resources (targeting 4,000 MW by 2035), alongside upgrades to existing hydro and fossil fuel plants. This ensures reliability and supports decarbonization goals.
• Constructive Regulatory Environment: The extension of the 2022 Alternate Rate Plan (ARP) through 2028 provides a stable retail Return on Equity (ROE) set point of 10.50% and an equity ratio of 56%, offering predictable earnings. Regulatory approvals for new capacity and cost recovery mechanisms are crucial for funding growth.
• Strong Financial Performance: Georgia Power delivered an impressive third quarter 2025, with net income rising nearly 19% to $1.25 billion, contributing significantly to Southern Company's overall profit increase. Year-to-date net income also grew by 9%, reflecting effective execution of its growth strategy.
• Capital Investment Super-Cycle: Georgia Power is in a significant capital investment phase, with certification requests for approximately $16.70 billion in new Georgia Power-owned projects and related transmission investments through 2029, aimed at meeting future energy needs and enhancing grid resilience.

Powering Georgia's Future: A Regulated Utility's Strategic Ascent

Georgia Power Company (NYSE:GPJA), a cornerstone subsidiary of The Southern Company (SO), stands as a vertically integrated electric utility serving over 2.8 million customers across Georgia. Its business model, rooted in a regulated framework, prioritizes providing clean, safe, reliable, and affordable energy, a mission critical for the state's burgeoning economy. This model allows for predictable revenue streams and cost recovery on prudently incurred investments, forming a stable foundation for its financial health.

The company operates within an industry undergoing a profound transformation, driven by increasing electrification, a surge in demand from large industrial customers—particularly data centers—and evolving environmental mandates. Georgia Power's risk-adjusted forecast projects a substantial demand growth of 8,448 megawatts (MW) between the winters of 2025/2026 and 2030/2031, underscoring the urgency and scale of its strategic initiatives. This robust demand outlook is a key factor enabling the company's three-year base rate freeze, helping to spread fixed costs across a broader customer base.

In this dynamic landscape, Georgia Power's overarching strategy is to meet this escalating demand through a diversified energy portfolio, continuous infrastructure modernization, and proactive regulatory engagement. The company's commitment to economic development is evident, having supported over 1,100 projects, 214,000 jobs, and $89 billion in capital investment since 2000. This strategic positioning is crucial for maintaining its competitive edge and delivering long-term value.

A Foundation of Strength: Strategic Investments and Technological Edge

Georgia Power's journey has been marked by significant regulatory and operational milestones that have shaped its current strategic direction. Key among these are the approvals of its Integrated Resource Plans (IRPs) and the extension of its Alternate Rate Plan (ARP). The 2022 ARP, extended through December 31, 2028, maintains a stable retail Return on Equity (ROE) set point of 10.50% and an equity ratio of 56%, providing a clear financial roadmap.

The company's technological differentiation lies in its diverse and continuously evolving energy generation mix and its commitment to grid modernization. Plant Vogtle Units 3 and 4, America's first new nuclear investment in 30 years, were placed in service in July 2023 and April 2024, respectively, providing reliable, emission-free energy for at least 60 to 80 years. These units are expected to produce over 30 million megawatt-hours of electricity annually, significantly contributing to Southern Company's goal of net-zero carbon emissions by 2050 and Georgia Power's achievement of a 60% reduction in carbon emissions. Further upgrades to Plant Vogtle Units 1 and 2 are projected to add 54 MW of incremental capacity as early as 2028.

Beyond nuclear, Georgia Power is making substantial investments in battery energy storage systems (BESS). The Georgia Public Service Commission (PSC) approved a 200 MW Georgia Power-owned battery energy storage facility with a projected Commercial Operation Date (COD) in 2027. The company has also requested certification for nine additional Georgia Power-owned battery energy storage facilities totaling 2,762 MW, and two facilities paired with solar totaling 350 MW, with projected CODs between 2028 and 2030. These storage solutions enhance grid resilience and optimize the use of intermittent renewable energy sources like solar.

The 2025 IRP also includes plans for installing environmental controls and natural gas co-firing at Plant Bowen Units 1-4 (3,160 MW), Plant Scherer Units 1 and 2 (137 MW), and Plant Scherer Unit 3, ensuring compliance with new Effluent Limitations Guidelines (ELG) and Greenhouse Gas (GHG) rules while extending the operational life of these critical assets. Upgrades to Plant McIntosh Units 10 and 11 are expected to yield 194 MW of incremental capacity by 2028, with an additional 74 MW from Plant McIntosh Units 1-8 by 2033. The company is also modernizing its hydro fleet, with new projects for nine existing hydro plants, expected to allow them to operate for at least another 40 years.

These technological advancements and strategic investments are foundational to Georgia Power's competitive moat. They enable the company to provide a highly reliable and increasingly clean energy supply, crucial for attracting and retaining large industrial and technology customers. The regulated nature of these investments ensures a return on capital, directly contributing to financial performance and long-term growth.

Robust Performance Amidst Transformation

Georgia Power demonstrated strong financial performance for the third quarter and nine months ended September 30, 2025, reflecting the positive impact of its strategic initiatives and a growing service territory. The company's net income in the third quarter of 2025 rose to $1.25 billion, an impressive nearly 19% increase compared to the same period in 2024. For the nine months ended September 30, 2025, net income reached $2.45 billion, up 9% from the prior year.

Operating revenues for the third quarter 2025 were $3.77 billion, an 8.6% increase from $3.47 billion in the corresponding period of 2024. Year-to-date operating revenues grew 13.4% to $9.92 billion from $8.75 billion.

This growth was primarily fueled by retail electric revenues, which increased 5.5% in the third quarter to $3.36 billion and 10.3% year-to-date to $8.75 billion. These increases were largely attributable to base tariff adjustments, higher Environmental Compliance Cost Recovery (ECCR) tariff revenues under the 2022 ARP, and the inclusion of Plant Vogtle Unit 4 in retail rates. Sales growth was a significant driver, with weather-adjusted residential kilowatt-hour (KWH) sales increasing 3.3% in the third quarter and 1.4% year-to-date, primarily due to customer growth and increased usage. Commercial KWH sales saw even stronger growth, rising 5.1% in the third quarter and 3.7% year-to-date, largely driven by the expanding presence of data centers. Industrial KWH sales also contributed positively, increasing 2.6% in the third quarter and 2.1% year-to-date, particularly in the electronics and primary metals sectors. Wholesale electric revenues surged by 79.5% in the third quarter to $140 million and 97% year-to-date to $390 million, driven by higher KWH sales volumes from increased market demand and elevated fuel and purchased power prices. Other electric revenues also saw substantial increases, up 29.7% in the third quarter to $271 million and 26.9% year-to-date to $774 million, primarily due to solar application fees and realized gains from price stability products for retail customers.

Operating expenses saw shifts, with a pre-tax credit of approximately $33 million recorded in the third quarter of 2025 related to the estimated probable loss on Plant Vogtle Units 3 and 4, reflecting reduced contractor obligations. Depreciation and amortization expenses increased due to additional plant in service and the amortization of regulatory assets related to Coal Combustion Residuals (CCR) Asset Retirement Obligations (AROs). Allowance for Equity Funds Used During Construction (AFUDC) also increased, reflecting higher capital expenditures, though partially offset by Plant Vogtle Unit 4 being placed in service. From a liquidity perspective, Georgia Power's current liabilities exceeded current assets by $696 million at September 30, 2025. Net cash provided from operating activities decreased by $197 million year-to-date, primarily due to the timing of vendor payments and storm restoration costs, partially offset by customer receivable collections. Net cash used for investing activities was predominantly for gross property additions, while financing activities were supported by net issuances of senior notes and capital contributions from Southern Company.

The company's long-term debt increased by $2.70 billion, reflecting significant capital investments in its infrastructure.

Strategic Vision and Growth Catalysts

Georgia Power's forward-looking strategy is firmly anchored in its recently approved 2025 Integrated Resource Plan (IRP) and the extension of its Alternate Rate Plan (ARP). The ARP Extension, effective through December 31, 2028, provides a stable regulatory environment, maintaining the retail ROE set point at 10.50% and an equity ratio of 56%. This stability is crucial for attracting the capital necessary for the company's ambitious growth plans.

The 2025 IRP outlines a comprehensive roadmap for meeting Georgia's escalating energy needs. It includes the extended operation of Plant Scherer Unit 3 through at least December 31, 2035, and Plant Gaston Units 1-4 through December 31, 2034, ensuring continued baseload generation. The plan also mandates an aggressive expansion of renewable resources, targeting the procurement of up to 4,000 MW by 2035, with at least 1,100 MW of new renewable resources proposed in the current IRP. This will expand the company's renewable portfolio to approximately 11,000 MW by 2035.

To support this growth, Georgia Power has requested certification for approximately $16.70 billion in new Georgia Power-owned projects and related transmission investments through 2029. These projects, with projected Commercial Operation Dates (CODs) between 2028 and 2030, include a diverse mix of 7,999 MW of capacity from new power purchase agreements (PPAs), Georgia Power-owned combined cycle units, and battery energy storage facilities, some paired with solar. The company also plans to issue a capacity Request for Proposals (RFP) to procure resources for capacity needs in 2032 and 2033.

Furthermore, Georgia Power's nuclear generating facilities qualify for Internal Revenue Code 45U Production Tax Credits (PTCs). For the 2024 tax year, the company claimed a base credit of $39 million, totaling $193 million with the prevailing wage multiplier, which has been recorded as a regulatory liability to benefit customers. These PTCs are available through 2032, subject to annual qualification. The company is scheduled to file its next fuel case no later than February 28, 2026.

Competitive Landscape: A Regulated Advantage

Georgia Power operates within a competitive landscape characterized by the inherent advantages of its regulated monopoly status within its service territory, yet it faces both direct and indirect competition. Its primary competitive moat stems from regulatory licenses and the substantial capital requirements for building and maintaining utility infrastructure, which act as significant barriers to entry for new players. This regulated structure provides Georgia Power with pricing stability and predictable revenue streams from long-term contracts, contributing to its robust financial performance.

Direct competitors in the broader utility sector include companies like Duke Energy (DUK), NextEra Energy (NEE), American Electric Power (AEP), and Entergy Corporation (ETR). While these companies share similar business models in electricity generation and distribution, Georgia Power distinguishes itself through its deep regional expertise and a diverse energy mix that includes significant nuclear and hydroelectric capabilities. This diversified portfolio offers operational resilience and stability in energy supply, which can translate to stronger cash flow generation in varied demand scenarios.

Compared to NextEra Energy, often seen as a leader in renewable integration, Georgia Power's approach balances traditional baseload power with an aggressive expansion into renewables and battery storage. While NextEra may exhibit faster growth rates in emerging renewable sectors, Georgia Power's established nuclear assets provide a unique value proposition for baseload reliability. Against American Electric Power, which emphasizes transmission, Georgia Power's integrated generation and distribution model offers greater flexibility in energy delivery. Similarly, when compared to Entergy, Georgia Power's Georgia-centric strategy allows for tailored responses to local demands, potentially leading to more efficient localized operations.

Indirect competition arises from alternative energy providers, such as independent solar installers, and technological advancements like advanced battery storage and decentralized energy solutions. The rise of AI-driven energy management software also presents a challenge by offering more efficient demand response systems. However, Georgia Power's proactive investments in its own battery storage facilities and smart grid technologies, alongside its focus on customer satisfaction (ranked #1 for business customer satisfaction among Large Utilities in the South by J.D. Power in 2024), help mitigate these threats. The company's new rules and regulations for large-load customers, requiring financial commitments and infrastructure readiness, further safeguard residential and small business customers from additional costs, ensuring sustainable growth.

Conclusion

Georgia Power Company stands as a compelling investment proposition, underpinned by its strategic response to escalating energy demand and a robust capital investment program. The company's commitment to a diverse and modernized energy portfolio, featuring advanced nuclear, expanding battery storage, and significant renewable energy procurement, positions it favorably for long-term growth and decarbonization goals. Supported by a constructive regulatory environment that ensures predictable returns, Georgia Power's recent financial performance reflects effective execution of its strategic vision.

While the company faces inherent risks associated with regulatory uncertainty, environmental compliance costs, and broader economic fluctuations, its strong market position, driven by regional expertise and critical infrastructure, provides a durable competitive advantage. The substantial projected demand growth, particularly from data centers, serves as a powerful catalyst for future earnings. Georgia Power's ongoing transformation, marked by continuous investment in innovative energy solutions and grid resilience, reinforces its role as a vital and evolving utility in the Southeastern United States.