ALABAMA POWER CO

Net Income Attributable to Southern Power

Net income attributable to Southern Power in the second quarter 2025 was $51 million compared to $86 million for the corresponding period in 2024. The decrease was primarily due to accelerated depreciation related to wind repowering projects and an increase in other operations and maintenance expenses due to increases in scheduled outage expenses and generation maintenance, partially offset by higher HLBV income associated with tax equity partnerships.

Net income attributable to Southern Power foryear-to-date 2025 was $138 million compared to $182 million for the corresponding period in 2024. The decrease was primarily due to accelerated depreciation related to wind repowering projects and an increase in other operations and maintenance expenses due to increases in scheduled outage expenses and generation maintenance, partially offset by higher revenues driven by higher market prices of energy and higher HLBV income associated with tax equity partnerships.

See Note (K) to the Condensed Financial Statements under "Southern Power – Wind Repowering Projects" herein and Note 15 to the financial statements under "Southern Power – Development Projects" in Item 8 of the Form 10-K for additional information.

Operating Revenues

Total operating revenues include PPA capacity revenues, which are derived primarily from long-term contracts associated with natural gas facilities, and PPA energy revenues derived from long-term contracts associated with Southern Power's generation facilities. To the extent Southern Power has capacity not contracted under a PPA, it may sell power into an accessible wholesale market, or, to the extent those generation assets are part of the FERC-approved IIC, it may sell power into the Southern Company power pool.

Natural Gas Capacity and Energy Revenue

Capacity revenues generally represent the greatest contribution to operating income and are designed to provide recovery of fixed costs plus a return on investment.

Energy is generally sold at variable cost or is indexed to published natural gas indices. Energy revenues will vary depending on the energy demand of Southern Power's customers and their generation capacity, as well as the market prices of wholesale energy compared to the cost of Southern Power's energy. Energy revenues also include fees for support services, fuel storage, and unit start charges. Increases and decreases in energy revenues under PPAs that are driven by fuel or purchased power prices are accompanied by an increase or decrease in fuel and purchased power costs and do not have a significant impact on net income.

Solar and Wind Energy Revenue

Southern Power's energy sales from solar and wind generating facilities are predominantly through long-term PPAs that do not have capacity revenue. Customers either purchase the energy output of a dedicated renewable facility through an energy charge or pay a fixed price related to the energy generated from the respective facility and sold to the grid. As a result, Southern Power's ability to recover fixed and variable operations and maintenance expenses is dependent upon the level of energy generated from these facilities, which can be impacted by weather conditions, equipment performance, transmission constraints, and other factors.

See FUTURE EARNINGS POTENTIAL – "Southern Power's Power Sales Agreements" in Item 7 of the Form 10-K for additional information regarding Southern Power's PPAs.

Operating Revenues Details

Details of Southern Power's operating revenues were as follows:

In the second quarter 2025, total operating revenues were $546 million, reflecting a $22 million, or 4.2%, increase from the corresponding period in 2024. The change in operating revenues was primarily due to the following:

•PPA energy revenues increased $14 million, or 4.2%, primarily due to an increase of $25 million related to the volume of KWHs sold under natural gas PPAs, partially offset by a decrease of $8 million driven by fuel and purchased power prices.

•Non-PPA revenues increased $9 million, or 15.0%, primarily due to an increase of $10 million driven by the market price of energy.

For year-to-date 2025, total operating revenues were $1.1 billion, reflecting a $116 million, or 11.6%, increase from the corresponding period in 2024. The change in operating revenues was primarily due to the following:

•PPA energy revenues increased $104 million, or 17.0%, due to an increase of $58 million primarily related to the volume of KWHs sold under natural gas PPAs and an increase of $46 million driven by fuel and purchased power prices.

•Non-PPA revenues increased $17 million, or 14.2%, due to an increase of $36 million driven by the market price of energy, partially offset by a decrease of $19 million related to the volume of KWHs sold through short-term sales.

•Other revenues decreased $7 million, or 33.3%, primarily due to a $15 million decrease associated with transmission revenues, partially offset by a $6 million increase in receipts associated with liquidated damages related to generation facility production guarantees and warranty settlements.

Details of Southern Power's generation and purchased power were as follows:

Southern Power's PPAs for natural gas generation generally provide that the purchasers are responsible for either procuring the fuel (tolling agreements) or reimbursing Southern Power for substantially all of the cost of fuel relating to the energy delivered under such PPAs. Consequently, changes in such fuel costs are generally accompanied by a corresponding change in related fuel revenues and do not have a significant impact on net income. Southern Power is responsible for the cost of fuel for generating units that are not covered under PPAs. Power from these generating units is sold into the wholesale market or into the Southern Company power pool for capacity owned directly by Southern Power.

Purchased power expenses will vary depending on demand, availability, and the cost of generating resources throughout the Southern Company system and other contract resources. Load requirements are submitted to the Southern Company power pool on an hourly basis and are fulfilled with the lowest cost alternative, whether that is generation owned by Southern Power, an affiliate company, or external parties. Such purchased power costs are generally recovered through PPA revenues.

Details of Southern Power's fuel and purchased power expenses were as follows:

In the second quarter 2025, total fuel and purchased power expenses increased $24 million, or 15.6%, compared to the corresponding period in 2024. Fuel expense increased $15 million due to a $22 million increase related to the volume of KWHs generated, partially offset by a $7 million decrease associated with the average cost of fuel. Purchased power expense increased $9 million due to an increase associated with the average cost of purchased power.

For year-to-date 2025, total fuel and purchased power expenses increased $86 million, or 26.2%, compared to the corresponding period in 2024. Fuel expense increased $67 million due to a $37 million increase associated with the average cost of fuel and a $30 million increase related to the volume of KWHs generated. Purchased power expense increased $19 million primarily due to a $17 million increase associated with the average cost of purchased power.

In the second quarter 2025, other operations and maintenance expenses were $135 million compared to $119 million for the corresponding period in 2024. For year-to-date 2025, other operations and maintenance expenses were $257 million compared to $241 million for the corresponding period in 2024. The increases were primarily due to increases in scheduled outage and generation maintenance expenses.

In the second quarter 2025, depreciation and amortization was $177 million compared to $127 million for the corresponding period in 2024. For year-to-date 2025, depreciation and amortization was $329 million compared to $245 million for the corresponding period in 2024. The increases for the second quarter and year-to-date 2025 were primarily due to accelerated depreciation of $42 million and $69 million, respectively, related to wind repowering projects. See Note (K) to the Condensed Financial Statements under "Southern Power – Wind Repowering Projects" herein and Note 15 to the financial statements under "Southern Power – Development Projects" in Item 8 of the Form 10-K for additional information.

Income Taxes (Benefit)

In the second quarter 2025, income tax benefit was $2 million compared to income tax expense of $13 million for the corresponding period in 2024. For year-to-date 2025, income tax benefit was $3 million compared to $1 million for the corresponding period in 2024. The changes were primarily due to a change in pre-tax earnings attributable to

Southern Power, including the impact of accelerated depreciation related to wind repowering projects. See Note (G) to the Condensed Financial Statements and Note (K) to the Condensed Financial Statements under "Southern Power – Wind Repowering Projects" herein for additional information.

Net Loss Attributable to Noncontrolling Interests

In the second quarter 2025, net loss attributable to noncontrolling interests was $27 million compared to $15 million for the corresponding period in 2024. The increase was primarily due to $9 million in lower income allocations to equity partners and $4 million in higher HLBV loss allocations to tax equity partners.

For year-to-date 2025, net loss attributable to noncontrolling interests was $91 million compared to $73 million for the corresponding period in 2024. The increase was primarily due to $12 million in higher HLBV loss allocations to tax equity partners and $7 million in lower income allocations to equity partners.