ALABAMA POWER CO

Georgia Power's net income in the third quarter 2025 was $1.2 billion compared to $1.1 billion for the corresponding period in 2024. The increase was primarily due to higher retail revenues associated with rates and pricing and sales growth, a decrease in taxes other than income taxes, and an increase in other revenues, partially offset by an increase in depreciation and amortization and weather impacts on retail revenues.

For year-to-date 2025, net income was $2.5 billion compared to $2.2 billion for the corresponding period in 2024. The increase was primarily due to higher retail revenues associated with rates and pricing and sales growth and other revenues, partially offset by an increase in non-fuel operations and maintenance expenses, depreciation and amortization, and income taxes.

In the third quarter 2025, retail revenues were $3.4 billion compared to $3.2 billion for the corresponding period in 2024. For year-to-date 2025, retail revenues were $8.8 billion compared to $7.9 billion for the corresponding period in 2024. Details of the changes in retail revenues were as follows:

Changes in rates and pricing resulted in an increase in revenues in the third quarter 2025 when compared to the corresponding period in 2024 primarily due to base tariff increases and increased ECCR tariff revenues in accordance with the 2022 ARP. Changes in rates and pricing resulted in an increase in revenues for year-to-date 2025 when compared to the corresponding period in 2024 primarily due to base tariff increases and increased ECCR tariff revenues in accordance with the 2022 ARP, the inclusion of Plant Vogtle Unit 4 in retail rates net of elimination of the NCCR tariff, and higher contributions from commercial and industrial customers with variable demand-driven pricing. See Note 2 to the financial statements under "Georgia Power" in Item 8 of the Form 10-K for additional information.

Changes in sales resulted in an increase in revenues in the third quarter and year-to-date 2025 when compared to the corresponding periods in 2024. Weather-adjusted residential KWH sales increased 3.3% in the third quarter 2025 primarily due to increased customer usage and customer growth. Weather-adjusted residential KWH sales increased 1.4% for year-to-date 2025 primarily due to customer growth. Weather-adjusted commercial KWH sales increased 5.1% and 3.7% in the third quarter and year-to-date 2025, respectively, primarily due to increased customer usage, primarily driven by data centers. Weather-adjusted industrial KWH sales increased 2.6% in the third quarter 2025 primarily due to increases in the electronics and primary metals sectors, partially offset by a decrease in the chemicals sector. Weather-adjusted industrial KWH sales increased 2.1% for year-to-date 2025 primarily due to increases in the electronics, paper, and transportation sectors, partially offset by decreases in the pipeline and textiles sectors.

Fuel revenues and costs are allocated between retail and wholesale jurisdictions. Retail fuel cost recovery revenues increased in the third quarter and year-to-date 2025 when compared to the corresponding periods in 2024 due to higher recoverable fuel costs. Electric rates include provisions to adjust billings for fluctuations in fuel costs, including the energy component of purchased power costs. Under these fuel cost recovery provisions, fuel revenues generally equal fuel expenses and do not affect net income. See Note (B) to the Condensed Financial Statements herein and Note 2 to the financial statements under "Georgia Power – Fuel Cost Recovery" in Item 8 of the Form 10-K for additional information.

Wholesale Revenues

In the third quarter 2025, wholesale revenues were $140 million compared to $78 million for the corresponding period in 2024. For year-to-date 2025, wholesale revenues were $390 million compared to $198 million for the corresponding period in 2024. The increases for the third quarter and year-to-date 2025 were due to increases of $23 million and $86 million, respectively, related to the volume of KWH sales associated with higher market demand, $23 million and $59 million, respectively, related to the average cost per KWH sold due to higher Southern Company system fuel and purchased power prices, and $16 million and $47 million, respectively, related to additional non-fuel revenues from wholesale capacity contracts.

Wholesale revenues from sales to non-affiliates consist of PPAs and short-term opportunity sales. Wholesale revenues from PPAs have both capacity and energy components. Wholesale capacity revenues from PPAs are recognized in amounts billable under the contract terms and provide for recovery of fixed costs and a return on investment. Wholesale revenues from sales to non-affiliates will vary depending on fuel prices, the market prices of wholesale energy compared to the cost of Georgia Power's and the Southern Company system's generation, demand for energy within the Southern Company system's electric service territory, and the availability of the Southern Company system's generation. Increases and decreases in energy revenues that are driven by fuel prices are accompanied by an increase or decrease in fuel costs and do not have a significant impact on net income. Short-term opportunity sales are made at market-based rates that generally provide a margin above Georgia Power's variable cost of energy.

Wholesale revenues from sales to affiliated companies will vary depending on demand and the availability and cost of generating resources at each company. These affiliate sales are made in accordance with the IIC, as approved by the FERC. Energy revenues related to these transactions do not have a significant impact on earnings since this energy is generally sold at marginal cost.

In the third quarter 2025, other revenues were $271 million compared to $209 million for the corresponding period in 2024. The increase was primarily due to increases of $29 million in solar application fees, $24 million in realized gains associated with price stability products for retail customers on variable demand-driven pricing tariffs, $12 million in unregulated sales primarily associated with power delivery construction and maintenance projects, and $6 million in outdoor lighting sales, partially offset by a decrease of $11 million in pole attachment revenues.

For year-to-date 2025, other revenues were $774 million compared to $610 million for the corresponding period in 2024. The increase was primarily due to increases of $88 million in unregulated sales primarily associated with power delivery construction and maintenance, resiliency, and renewables projects, $30 million in solar application fees, $16 million in realized gains associated with price stability products for retail customers on variable demand-driven pricing tariffs, $15 million in outdoor lighting sales, $13 million in regulated sales associated with power delivery construction and maintenance projects, and $9 million in open access transmission tariff sales, partially offset by a decrease of $11 million in pole attachment revenues.

In the third quarter 2025, total fuel and purchased power expenses were $945 million compared to $829 million for the corresponding period in 2024. The increase was due to a $47 million increase related to the volume of KWHs generated and purchased, a net increase of $9 million related to the average cost of fuel and purchased power, and an increase of $60 million related to credits recorded in the third quarter 2024 resulting from litigation related to nuclear fuel disposal costs.

For year-to-date 2025, total fuel and purchased power expenses were $2.7 billion compared to $2.3 billion for the corresponding period in 2024. The increase was due to a $228 million net increase related to the volume of KWHs generated and purchased, an increase of $145 million related to the average cost of fuel and purchased power, and an increase of $60 million related to credits recorded in the third quarter 2024 resulting from litigation related to nuclear fuel disposal costs.

See Note 3 to the financial statements under "Nuclear Fuel Disposal Costs" in Item 8 of the Form 10-K for additional information.

Fuel and purchased power energy transactions do not have a significant impact on earnings since these fuel expenses are generally offset by fuel revenues through Georgia Power's fuel cost recovery mechanism. See Note 2 to the financial statements under "Georgia Power – Fuel Cost Recovery" in Item 8 of the Form 10-K for additional information.

Energy purchases from non-affiliates will vary depending on the market prices of wholesale energy as compared to the cost of the Southern Company system's generation, demand for energy within the Southern Company system's electric service territory, and the availability of the Southern Company system's generation.

Energy purchases from affiliates will vary depending on the demand and the availability and cost of generating resources at each company within the Southern Company system. These purchases are made in accordance with the IIC or other contractual agreements, all as approved by the FERC. See Note 2 to the financial statements under "Georgia Power – Integrated Resource Plans" in Item 8 of the Form 10-K for information regarding two new PPAs with Southern Power.

Details of Georgia Power's generation and purchased power and the related costs were as follows:

(a)Excludes KWHs generated from test period energy at Plant Vogtle Unit 4 prior to being placed in service in April 2024. The related fuel costs were charged to CWIP in accordance with FERC guidance.

(b)Excludes $60 million of credits recorded to nuclear fuel expense in the third quarter 2024 resulting from litigation related to nuclear fuel disposal costs. See Note 3 to the financial statements under "Nuclear Fuel Disposal Costs" in Item 8 of the Form 10-K for additional information.

(c)Average cost of purchased power includes fuel purchased by Georgia Power for tolling agreements where power is generated by the provider.

In the third quarter 2025, other operations and maintenance expenses were $616 million compared to $613 million for the corresponding period in 2024. The increase was primarily due to increases of $12 million in generation expenses primarily due to non-outage maintenance expenses, $10 million in expenses associated with unregulated power delivery construction and maintenance, energy conservation, and renewables projects, $10 million in certain technology infrastructure and application production costs, $10 million in certain employee compensation and benefit expenses, $7 million in customer service expenses, and $5 million related to the injuries and damages reserve, largely offset by a $33 million credit to income related to the estimated probable loss on Plant Vogtle Units 3 and 4 and a decrease of $19 million in transmission and distribution expenses primarily due to billing adjustments with integrated transmission system owners.

For year-to-date 2025, other operations and maintenance expenses were $1.9 billion compared to $1.6 billion for the corresponding period in 2024. The increase was primarily due to a $114 million gain from the sale of integrated transmission system assets in the second quarter 2024 and increases of $68 million in generation expenses primarily due to non-outage maintenance expenses largely resulting from Plant Vogtle Unit 4 being placed in service in April 2024, $62 million in expenses associated with unregulated power delivery construction and maintenance, energy conservation, and renewables projects, $37 million in certain employee compensation and benefit expenses, and $34 million in certain technology infrastructure and application production costs.

See Note (B) to the Condensed Financial Statements under "Georgia Power – Nuclear Construction" herein and Note 2 to the financial statements under "Georgia Power" in Item 8 of the Form 10-K for additional information.

In the third quarter 2025, depreciation and amortization was $526 million compared to $462 million for the corresponding period in 2024. For year-to-date 2025, depreciation and amortization was $1.5 billion compared to $1.3 billion for the corresponding period in 2024. The increases for the third quarter and year-to-date 2025 were primarily due to increases of $35 million and $121 million, respectively, associated with additional plant in service and $31 million and $93 million, respectively, in amortization of regulatory assets related to CCR AROs as approved in the 2025 compliance filing under the terms of the 2022 ARP. See Note 2 to the financial statements under "Georgia Power – Rate Plans" in Item 8 of the Form 10-K for additional information.

In the third quarter 2025, taxes other than income taxes were $75 million compared to $177 million for the corresponding period in 2024. For year-to-date 2025, taxes other than income taxes were $417 million compared to $488 million for the corresponding period in 2024. The decreases for the third quarter and year-to-date 2025 were primarily due to decreases of $108 million and $93 million, respectively, in property taxes primarily resulting from the actualization of prior-year tax assessments, partially offset by increases of $4 million and $19 million, respectively, in municipal franchise fees resulting from higher retail revenues.

In the third quarter 2025, allowance for equity funds used during construction was $67 million compared to $37 million for the corresponding period in 2024. For year-to-date 2025, allowance for equity funds used during construction was $171 million compared to $108 million for the corresponding period in 2024. The increases were primarily due to an increase in capital expenditures subject to AFUDC. Partially offsetting the increase for year-to-date 2025 was the impact of Plant Vogtle Unit 4 being placed in service in April 2024. See Note 2 to the financial statements under "Georgia Power – Nuclear Construction" in Item 8 of the Form 10-K for additional information on Plant Vogtle Unit 4.

In the third quarter 2025, interest expense, net of amounts capitalized was $200 million compared to $184 million for the corresponding period in 2024. For year-to-date 2025, interest expense, net of amounts capitalized was $585 million compared to $543 million for the corresponding period in 2024. The increases for the third quarter and year-to-date 2025 were primarily associated with increases of approximately $20 million and $43 million, respectively, related to higher average outstanding borrowings, partially offset by increases of $8 million and $10 million, respectively, in AFUDC debt related to increased capital expenditures. Also contributing to the increase for year-to- date 2025 was a decrease of $12 million in net deferred financing costs related to Plant Vogtle Unit 3. See Note 2 to the financial statements under "Georgia Power – Nuclear Construction – Regulatory Matters" in Item 8 of the Form 10-K and FINANCIAL CONDITION AND LIQUIDITY – "Sources of Capital" and "Financing Activities" herein for additional information.

In the third quarter 2025, income taxes were $278 million compared to $246 million for the corresponding period in 2024. The increase was primarily due to higher pre-tax earnings, partially offset by an increase of $26 million in the flowback of excess state deferred income taxes.

For year-to-date 2025, income taxes were $612 million compared to $516 million for the corresponding period in 2024. The increase was primarily due to a $78 million increase in charges to a valuation allowance on certain state tax credit carryforwards, higher pre-tax earnings, and $33 million from the recognition of certain state tax positions from amended returns in the second quarter 2024, partially offset by increases of $60 million in the flowback of excess state deferred income taxes and $19 million in the generation of advanced nuclear PTCs.