ALABAMA POWER CO

Georgia Power's net income in the third quarter 2026 was $1.5 billion compared to $1.2 billion for the corresponding period in 2025. The increase was primarily due to higher non-fuel retail revenues, partially offset by increases in other operations and maintenance expenses and taxes other than income taxes.

For year-to-date 2026, net income was $2.9 billion compared to $2.5 billion for the corresponding period in 2025. The increase was primarily due to higher non-fuel retail revenues, an increase in AFUDC equity, higher non-fuel-related wholesale revenues, and a decrease in income taxes, partially offset by increases in other operations and maintenance expenses, taxes other than income taxes, and interest expense.

In the third quarter 2026, retail revenues were $4.1 billion compared to $3.4 billion for the corresponding period in 2025. For year-to-date 2026, retail revenues were $9.5 billion compared to $8.8 billion for the corresponding period in 2025. Details of the changes in retail revenues were as follows:

Changes in rates and pricing resulted in increases in revenues in the third quarter and year-to-date 2026 as compared to the corresponding periods in 2025 primarily due to higher contributions from commercial and industrial customers with variable demand-driven pricing.

Changes in sales resulted in increases in revenues in the third quarter and year-to-date 2026 as compared to the corresponding periods in 2025. Weather-adjusted residential KWH sales increased 1.0% in the third quarter 2026 primarily due to customer growth. Weather-adjusted residential KWH sales increased 0.3% for year-to-date 2026 primarily due to customer growth. Weather-adjusted commercial KWH sales increased 10.2% and 9.3% in the third quarter and year-to-date 2026, respectively, primarily due to increased customer usage, largely driven by data centers. Weather-adjusted industrial KWH sales decreased 1.2% in the third quarter 2026 primarily due to decreases in the paper, textiles, and primary metals sectors, partially offset by increases in the miscellaneous manufacturing, transportation, and food sectors. Weather-adjusted industrial KWH sales decreased 0.8% for year-to-date 2026 primarily due to decreases in the paper, textiles, and primary metals sectors, partially offset by increases in the miscellaneous manufacturing, stone, clay, and glass, and food 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 2026 as compared to the corresponding periods in 2025 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 under "Georgia Power – Fuel Cost Recovery" 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

For year-to-date 2026, wholesale revenues were $495 million compared to $390 million for the corresponding period in 2025. The increase was due to a $98 million increase in energy revenues associated with increases of $52 million related to the average cost per KWH sold resulting from higher Southern Company system fuel and purchased power prices, $29 million in non-fuel-related energy revenues from wholesale contracts, and $17 million related to the volume of KWH sales associated with higher market demand, as well as a $7 million increase in capacity revenues from new and existing power sales agreements.

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 2026, other revenues were $241 million compared to $271 million for the corresponding period in 2025. The decrease was primarily due to decreases of $31 million in renewable energy program revenues primarily associated with solar application fees and $17 million in realized gains associated with price stability products for retail customers on variable demand-driven pricing tariffs, partially offset by an increase of $14 million in outdoor lighting sales.

For year-to-date 2026, other revenues were $777 million compared to $774 million for the corresponding period in 2025. The increase was primarily due to increases of $28 million in open access transmission tariff sales, $24 million in outdoor lighting sales, and $22 million in unregulated sales associated with power delivery construction and maintenance projects, partially offset by decreases of $31 million in unregulated sales associated with energy conservation projects and $28 million in renewable energy program revenues primarily associated with solar application fees.

In the third quarter 2026, total fuel and purchased power expenses were $1.08 billion compared to $0.95 billion for the corresponding period in 2025. The increase was due to increases of $104 million related to the volume of KWHs generated and purchased and $35 million related to the average cost of fuel and purchased power.

For year-to-date 2026, total fuel and purchased power expenses were $2.95 billion compared to $2.75 billion for the corresponding period in 2025. The increase was due to a $187 million increase related to the volume of KWHs generated and purchased and a $19 million net increase related to the average cost of fuel and purchased power.

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 demand for energy 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.

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

(*)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 2026, other operations and maintenance expenses were $766 million compared to $616 million for the corresponding period in 2025. The increase was primarily due to increases of $42 million in transmission and distribution costs, $39 million in storm damage recovery, and $28 million in generation expenses largely due to planned outage expenses, as well as a $33 million credit to income related to the estimated probable loss on Plant Vogtle Units 3 and 4 in 2025.

For year-to-date 2026, other operations and maintenance expenses were $2.1 billion compared to $1.9 billion for the corresponding period in 2025. The increase was primarily due to increases of $58 million in transmission and distribution costs, $52 million in storm damage recovery, $43 million in generation expenses largely due to non-outage maintenance expenses, $31 million in customer education and assistance expenses, and $18 million in certain employee compensation and benefit expenses, as well as a $33 million credit to income related to the estimated probable loss on Plant Vogtle Units 3 and 4 in the third quarter 2025, partially offset by a decrease of $25 million in technology infrastructure and application production costs.

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

In the third quarter 2026, depreciation and amortization was $516 million compared to $526 million for the corresponding period in 2025. For year-to-date 2026, depreciation and amortization was $1.50 billion compared to $1.54 billion for the corresponding period in 2025. The decreases in the third quarter and year-to-date 2026 were primarily due to decreases of $100 million and $297 million, respectively, resulting from the extension of the 2022 ARP, partially offset by increases of $77 million and $224 million, respectively, from additional plant in service and $12 million and $30 million, respectively, from depreciation associated with PPAs accounted for as finance leases. See Note 2 to the financial statements under "Georgia Power – Rate Plans" in Item 8 of the Form 10-K and Note (F) to the Condensed Financial Statements under "Georgia Power Lease Modification" herein for additional information.

In the third quarter 2026, taxes other than income taxes were $211 million compared to $75 million for the corresponding period in 2025. For year-to-date 2026, taxes other than income taxes were $525 million compared to $417 million for the corresponding period in 2025. The increases in the third quarter and year-to-date 2026 were primarily due to increases of $116 million and $81 million, respectively, in property taxes largely resulting from the timing of prior-year actualizations and increases of $19 million and $23 million, respectively, in municipal franchise fees resulting from higher retail revenues.

Allowance for Equity Funds Used During Construction

In the third quarter 2026, allowance for equity funds used during construction was $112 million compared to $67 million for the corresponding period in 2025. For year-to-date 2026, allowance for equity funds used during construction was $313 million compared to $171 million for the corresponding period in 2025. The increases were primarily due to an increase in capital expenditures subject to AFUDC.

In the third quarter 2026, interest expense, net of amounts capitalized was $249 million compared to $200 million for the corresponding period in 2025. For year-to-date 2026, interest expense, net of amounts capitalized was $680 million compared to $585 million for the corresponding period in 2025. The increases in the third quarter and year-to-date 2026 were primarily associated with increases of approximately $23 million and $75 million, respectively, related to higher average outstanding borrowings and $30 million and $51 million, respectively, in interest associated with PPAs accounted for as finance leases, partially offset by increases of $11 million and $40 million, respectively, in AFUDC debt related to increased capital expenditures. See FINANCIAL CONDITION AND

LIQUIDITY – "Sources of Capital" and "Financing Activities" herein and Note (F) to the Condensed Financial Statements under "Georgia Power Lease Modification" for additional information.

In the third quarter 2026, income taxes were $293 million compared to $278 million for the corresponding period in 2025. The increase was primarily due to higher pre-tax earnings and a decrease of $23 million in the flowback of excess state deferred income taxes, partially offset by an increase of $70 million in amortization of federal PTCs and ITCs.

For year-to-date 2026, income taxes were $529 million compared to $612 million for the corresponding period in 2025. The decrease was primarily due to an increase of $102 million in amortization of federal PTCs and ITCs and a decrease of $82 million in charges to a valuation allowance on certain state tax credit carryforwards, partially offset by higher pre-tax earnings and a decrease of $53 million in the flowback of excess state deferred income taxes.

See Note (G) to the Condensed Financial Statements herein for additional information.