SO - Earnings call transcript Q3 2020

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Operator

Good afternoon. My name is Pema, and I will be your conference operator today. At this time, I would like to welcome everyone to the Southern Company Third Quarter 2020 Earnings Call. All lines have been muted to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. reminder, is a October recorded, As XXXX. XX, Instructions] this being conference Thursday, [Operator like the to Mr. now would I turn conference to over Scott Director. Gammill, Investor Relations ahead, go sir. Please

Scott Gammill

Thank Southern welcome earnings you, afternoon quarter call. third XXXX to Pema. Good Company’s and

me Chief Officer and Evans, Financial of Chairman, Drew Executive Officer. and today are Company; Joining Fanning, Chief President, Tom Southern

in Let addition cause information. indicated historical factors could forward-looking to actual from you, to the Various XX-K, be materially and subsequent forward-looking making those our we’ll remind filings. including providing me statements in differ results discussed today statements, Form XX-Qs, important those in Form

In as call addition, the at will non-GAAP slides I’ll call, conference the in this both financial applicable the this time, turn financial information the released we for Tom Reconciliations on website this to to call. Relations included are our provide Investor measure which investor.southerncompany.com. information well are available this Fanning. as GAAP At over we on morning,

Tom Fanning

afternoon. all thank Good Thanks, you us. for Scott. And joining

of businesses businesses in XXXX, half home, our year COVID-XX has As share and of Well from and you customers our working results earlier quarter, impacts COVID-XX communities field, serving many moderated to affordable our and facilities been in Safety from case in third our demand this the we and daily and the health delivery of reliable our Throughout continued of end released and and extraordinary delivered levels perform historic means never given on the and of for to and the energy strong expect protocols employees essential we ahead we from have safe, resilience model related in provided range. materials clean, homes reported full this the operational challenges, we in estimate last morning, staff year. COVID-XX gas per essential adjusted we've strong and earnings our year a business employees to faced conference adjusted season, working have provided have ensure our have substantial through them. guidance to both of call. which reliability be top can to been outstanding at experienced And important they results to the resilience, functions, customers. employees customers. the employees the resulted see nearly September, demonstrated our supporting our in XXXX customers, as been service has financial with busy as excellent circumstances demonstrate our the Despite today an have storm performance. pandemic and exceedingly and achieved protect result more

of progress and As improvement Unit X Unit we cash continue and significant foundation per reach will an share expected dividend earnings ratio. a of growth Vogel set rate increase we dramatically improving of on and the long-term our completion X, flow payout for our

Let's on and turn now X. plant Vogel Units X to an update

the We that service in-service for Unit of be of date. November the XXXX and continue quarter plan current during major to timing Xs date third November work plan, regulatory and expect and in updated ahead approved work remaining milestones. XXXX the X our its now regulatory Unit on for our focus dates, on service the approved XXXX of recently Based November meeting we to XXXX

to reaching scheduled to is Now capital with November project milestones a its as site XXXX. complete, share of cost cost current $X.X perspective, our continue major With X of a total targeted of the ranges From expectations the to service forecast date Unit at billion. XXXX XX% continues approved Power direct Unit construction unchanged aggressive tool narrow. we utilize Georgia for X approximately around date to June for plan a in-service work an and regulatory margin provide

used have have approved in-service we as calls, regulatory X. margin and we work plan November aggressive as the an a date and years, three Unit the to drive about to tool on earnings provide on-site for For productivity to discussed prior

project. date. XXXX, first XXXX, which Unit Now, a testing Unit functional identification by work use Unit late the that which this of created current for work and plan, construction regulatory mitigation expect on hot milestone margin XXXX. this reached also current mid-year testing us the X, of testing the regulatory Under still systems load we service strategy has fuel and away start to plan future major reflects in provides its mid-October, to date. aggressive are served our hydro an early place and approximately of started plan date. could and our approved as construction in Considering margin important in we months progress, work for for projects approved gear. followed as operate well quarter service well Indeed, Unit anticipate earlier It occur and XXXX, November November as is facilitating on the turning components of of coolant Unit the and X; risks. construction end as of approved to the March date, January of the to in call, time we completed late for functional for two building, of was Unit in In and successfully turban the tool assumptions three in-service could regulatory start workforce, to motivating from shield November third cold work as support Since productivity, pumps we load to to X advancing our last major reactor expectation. early has of pace fuel XXXX, the milestone, successfully civil remember this the the as X, providing milestones X X plan shifting of we the hot completed That for updated site as that two, in-service next April testing as a

of electrical and its for milestone, of remain performance. major hot next system functional the areas and prepares critical site the turnovers testing, subcontractor As timing focus

site completion. as towards experienced expect of present through the managed is While two work will continued we we pandemic COVID-XX, and waves the challenges

system approach turnover we X middle and increase. coming as And to testing, to in hot activities for and the to ITAAC continue review Now expect Unit accelerate. months, we testing functional

been X ample documentation together load. submit that and staff the plan on documentation Nuclear for years to to and Nuclear that NRC necessary working review have the NRC the ability a a Southern provides conduct allow Southern Unit fuel the of time prior to the

up of ends closure these notifications, All At ICNs, XX% for have followed nearly X. Unit call load. achievements. and XXX milestone to during notifications point, ITAAC with high the have hot ITAAC accepted consistent the by we approximately to submit is for X. more as functional ITAAC Unit the we the XXX for XXX verified to submitted XX we been plan to complete expectations testing, ITAAC functional by our both And testing and more uncompleted approximately X UI been NRC verification hot by and progress the as NRC, or review over and this the NRC fuel of Leading and approach

by initial later operations expect to receipt a load. and all Vogtle be and fuel the team submitted ICNs X in continues Unit in Safety to we Operators fashion safety support Strong this for for highlighting World will the We year, and ITAAC and and startup developed of operation. team successfully fuel The preparation Unit position X have timely the increase an project reviewed X Association The in completed that X Culture Safety testing. pre-operational Nuclear the successful review the pre-startup

represents operator fuel senior evaluated This both We received reactor exercise, number and X XX set stage Units load. and These licenses for for X. reactor the for NRC site also to approval for preparedness licenses, X staffing completed full emergency first units. operator achieve accomplishments the the Unit the and

Power on of quarter no cost. allocated the contingency construction change associated Based productivity to field assessment, the our turn capital with the risks in reflecting recent project XXXX, is In capital approximately let's $X million of and forecast, cost to third construction cost support. most the base Now total forecast. there Georgia

site the or cost a Georgia embedded between regulatory service capital cost of is schedule the approved recall, margin in dates Power's time plans and estimated Now November the forecast. the base work in

Unit was scheduled of combined $XX Following contingency and the X approximately scheduled estimated cost margin cost the of site million cost to represent work margin remaining XX% this Unit X The remaining and to update cost utilized. plans, approximately complete.

As we Unit X testing on the the into and ramp in towards the construction transit -- transmission our of to utilize of as plant we XXXX. of funds project. major phases same regulatory the in will progress to its approved ITAAC construction, into all year XXXX, Through the system we continue contingency to and have quarter a Xs turnover underway operations X final submittals transition is production said, for and up Unit ahead expect completion focus Vogtle in-service team date. At activities, of of this Unit the remainder time, milestones related our first

While still the and our over it the there for we you approved ahead for that XXXX uncertainty, expectation an current update when of I’ll reach November turn is X, date. Unit our on to in-service completion Drew, is regulatory now outlook. financials

Drew Evans

Thanks, Tom, and good afternoon, all you everyone. I are hope well.

quarter. strong mentioned, a had Tom we As very

Third share. per $X.XX quarter was APS adjusted

than quarter. lower estimate year, it above last While $X.XX the for is $X.XX our

was was for a than of of the drivers variance the weather a impact warmer XXXX. the quarter this in of The of positive $X.XX, weather $X.XX, quarter normal hence last variance. third to positive significantly One XXXX year was normal relative the third

due utilities. COVID-XX very had state reported package. addition, today's in of the through diligent resulting detailed a a September, our in and Year-over-year we earnings $X.XX included and mitigated A the cost results release modest which reconciliation decline is through negative control dynamics third quarter actions of adjusted XXXX at constructive similar. our to In are regulatory and we in sales impact,

nine to income For September $X.XX the substantially by through and $X.XX the than in allowing impacts adjusted temperatures weather share, basis was we year-to-date estimates an impacts reduced an when is lower a year. the COVID-XX This year, $X.XX. exceed first in EPS year's $X.XX, XXXX. adjusted impacts both XXXX, first EPS COVID-XX which additional compared headwinds, $X.XX these throughout months normal resulted variance each have have three mitigated of to compared on milder our per last quarters. and weather added in Despite us to of

$X.XX expect guidance $X.XX solid share. we earnings September, year of the to results of per be end at top our range share full the adjusted to through With per

assess business. the We to our financial of COVID-XX impacts continue on

sales the third aggregate impact our than the of in For the expectation. X% better weather baseline slightly COVID-XX normal quarter, reduced and by

from you to seeing the As better trend expect, troughs classes customer working would sector, residential markedly slight relative for is industrial a are to The people and home. both spring. the commercial due we still last uplift from

our above both forecast. full Factoring customer our impacts remains for sectors revenues However, in to recovery year-to-date, uncertain. all in classes the slightly non-fuel timeline came across

projection sales $XXX we the COVID-XX retail unchanged, on impacts overall range of normal in be to total Based approximately basis. decline the expect year million is to Our expected to the weather for X% the on full year. for full X% with date, a results

to potential expense. In increase continuing addition we arrears to monitor and sales, in for an are debt the bad customer

also debt position robust. and regulated regulatory expense have for and related mechanisms our liquidity customers special commissions proceedings. balances. us with anticipated bad across closely Customer to have our by than past-due better states, been put worked the remains with payment our have across of trended future We account in those address in our utilities, actually place companies COVID-XX allowing plans many in Constructive cost offering arrears operating

annual are XXXX, our on Additionally, deployment through target plans. capital to three the we meet first of quarters

billion update, Turning rate rates, aggregate us positions locking notes quarter the of third and subsidiaries a parent. allowing and to $X.X markets at record an the our in several of raised capital billion, coupon Company increasing Southern $X liquidity low to higher redeem brief during

equity to perspective, rating we term upgraded still upgraded Mississippi need be Fitch senior long least Power’s a forecast third recall, From at to senior quarter, XXXX. also BaaX. Importantly, A-minus. during the Mississippi no Power’s unsecured until Moody's ratings rating unsecured debt

ratings, Company investors. both demonstrate to to continued stable and and operating moved Lastly, significant and integrity Power. issuers commitment companies of all Fitch of for Southern to customers strong which These its benefits the provides changes financial our outlook except credit positive Georgia

our back XX%. turn to was like of it coal resources one-third Tom, to supply represented I year. carbon trends energy September, so far and Before just for zero highlight our energy I'd from this mix Through nearly

path report interim project our that our look full first We as with as from a zero modern reduction and be that for goal of high the transition, to for portfolio fleets initiatives, We approach this natural by a to continued we net our continue of We've in coal XXXX. key carbon significant of be energy level, to to negative year coal for Zero, endeavors and achieving gas of efficiency gas we currently Action which project back enhanced the Net At achieve goal below progress a history. could zero you, goal R&D clean Implementation turn forward our utilization generation month, Tom, on in continued carbon do greenhouse zero and several XX% these this XXXX discussing we time Toward as With will that, Last toward made to XXXX. ahead. published in for net we early outlined in I'll expect called supplemental our you. emissions resources, enable XX% energy including carbon to years focus growth decarbonize to the in our we technologies. comprised elements, to transition, of solutions, further continue it

Tom Fanning

Adding the an $XXX Research agreement, industry fossil of Southern Energy's million Energy notion in the Center agreement and Center, energy your States to Southern Drew. renewed to for continue and The reinforcing Thanks Company National and located research Capture manage Carbon laboratory Company operate the United five is comments recently with that Through Office National an and leader in Alabama. additional development. operate to the the Wilsonville, years. this will Department Southern of Technology

the Center range and Capture the Over successfully of improving cost. scale, toward reducing past technologies commercial National while decade, advanced has wide performance the Carbon

from and Center, the evaluation the energy Institute scale battery large Edison demonstration and resources low Research Electric Alabama. storage, highest of in Edison development with demonstration honor African the Southern involving and And we accelerate carbon energy carbon worldwide to Technology hub Institute for storage, Southerns' storage initiative work technologies. technology to Company award, is research for low development also Birmingham, the received through recently industry the and energy energy testing, our sponsor partnering industry's Gas

future advance Southern an Company storage, energy leadership decarbonized technology. will a influx is providing of delivering and expertise technical advanced to require

solutions. the So we advanced translated demonstrate into those continue year that to performance next and employees exemplary solid which operational unprecedented in it's performance, and financial circumstances Despite transformational today. company essential and for find leverage collaboration XXXX, our to has generation

fronts plans achieving today regulatory our uphold online year our of As we is and on a discipline, service approved unit bring Paul risk for move shareholders. Southern after these service concurrent three by the career best-in-class to ahead, Company. at in operating key believe priorities an that with now in positioned cost retire levels, to Vogtle attractive execute and Bowers remarkable Power, return Georgia remain working states. XXXX and X utilities our fuel diligently goal well earlier expected April adjusted to demonstrating X Company In Units November successfully We that XX with closing, load, Southern

company a a Executive company long and Chris serve, strong is and For Paul. growth Affairs a customers. our strong we positioned and continue today. deep Georgia of fostered leaders Womack, energy the he am to operating leadership CEO diverse we retirement. it President premier commitment than led External and the and has succeed President will Chairman of Company progress customer company, Power is always we Vogtle development. of our continued effective our commitment success. assume here has Georgia construction XXXX as across to is unit The Vice at fuel immeasurable. have of how functional succession by and our will state as begin companies, This have responsibilities cheering led communities of to he continue X, loading site customers and pleased very ready through the X we President and our had that X and of the Southern and and will Paul's He training in system the the Chris in and standing At as more to satisfaction November I has serve decade, company additional cross tradition Power energy planning communities Georgia our serving From the effective upon we for he three. our our leading his be employees, its response storm industry to continue the impact has portfolio on be

Paul, energy knew very extensive it that are has affordable after safe, experience Georgia for Power works of level, leader. industry, Power. the of to and leader we follow valuable Chief also leading Georgia and Production national Now, Head to across confident He South. active remarkable experience reliable Affairs as of affairs clean, government and millions would in remained regulatory served and the be and is energy at the Georgians. state depth and a continue Officer With Georgia take providing Chris Chris External well in will known we the and as incredibly previously for His

company, awfully More customers final people. employees, from theory even down Orleans, in working at thousands note, The we're X.X with and a importantly, was to call good now that but experienced leads its of X million communities for Zeta One Hurricane its we Mac, My out came where and wind New this then and bulk and million passion restore its we power Alabama excess gust of o'clock, today Chris people here as in its to our as are the XX about had across and we hit miles have Report hands. X customers of around an that of Georgia, at Mississippi, customers. hour. of

of hope and continue the providing we know communities our days will serve. ahead, but already track only we've that excellent I electricity, So, record the quickly restoring progress. to not made some we In service

those So, know work their I efforts, to people for safely. they'll thanks and

take to ready now questions. we're Operator, afternoon. this us joining for you thank So,

Operator

question Dumoulin-Smith sir. Bank the Absolutely. go with of America. of Please [Operator ahead, Julien Instructions] from Our line comes first

Tom Fanning

for joining us. Julien, Hello thanks

Unidentified Analyst

doing? Julien. for Richie Hey good afternoon. is This you How here

Tom Fanning

well. you Hey, to Glad have Richie. as

Unidentified Analyst

where and just I you a it comparing the on roughly other days testing direct color if political it news. Thanks. know seems XX to a items, context functional XX for compared I'm with incited the might you've from like days looks provide what allocated timeline differences be can there? the little you China just And peer I right. plant labor was All in little like the can a comparison given provide start hot the curious if but bit is finish curious to

Tom Fanning

laid that I'll We honestly, the people there, us as we well, know, think a people these magazine Yeah, that people researched -- through people test and you had to with went XX say that all functional this, through X Vogel Westinghouse just magazine. it. and our the we've -- there. our -- we've where the had [Indiscernible] We at this from fact, startup hot procedures, I The in days came Westinghouse endorse appeared see we from can't article, site, from own X. plants number And we that have have in they are at and it plant from Westinghouse now out. people as tests, complete of plan went

number every kind about end fuel associated ITAC of for of of load the last don't the We are and tests of the the Recall, don't I We know hot I fuel file test the assessing about ITAC. test load turnover And passage things of the will milestone. associated of conversation XX to that accomplishment know kind as functional just mentioned, from. of month because comes some the plan that's where days filing functional include ITAC been tax. And systems running to hot where there's we pace from of with that from we at ITAC with file time. days of like beginning comprised the test. you XX So, starting essentially then the XXX of days,

yet out, we about as hot it will round tests the that before laid start functional another we numbers, following ITAC so XXX XX. loads the that XXX, that's fuel file test during we And there's test, before another

clear that's I very So, think.

guessing don't or begin here start that may how confuse thing a you know, test. and I'm but other just the The of duration I

the that what they could you disciplined with hot the I involve up that's hot we're the maybe came There's XX. very say And activities, will where calling are are pressurization tests. with you pre-start a of And of guess lot reactor could activities that area. began conceivably of functional say, start functional We tests.

plan are So, been let on site it endorse as forward. folks finish with the put in me here, we have that there China were just constructive they and it and our

Unidentified Analyst

Appreciate very terms it June over XX, there. remarks percentage turning Got it. just but you like schedule complete And helpful. That's clarifying VCN targeting I behind of month. it's in to November the know then indicated slipping have per slightly maybe Unit just guys that looks the X, in here XXXX,

if especially curious to here? a provide you back Just milestones needed considering can on getting with of little track, Unit remaining on there a bit the color complete X

Tom Fanning

not thanks Yeah, off fact, it's plan. Richie track, by in and really it's

of went If way went disclosed to onset that site which recall you re-sequence virus the That also essentially required from back of us we to recall, the along at personnel X,XXX. the work at COVID through here. when site, we density lessening X,XXX we reducing the say a and to

productivity One for ideas X. so we to brought as the Unit was a down of was some Unit put progress borrow we down the of on put intentionally the of them borrow We time. that -- X from Unit could and we brought X personnel period place X maintain Unit numbers into the of

by, October to schedule, number move We're in as year, November drive the that X.X% Now hit Unit to per Unit X gym. on for need achieve up. the to -- per month, over more is achieved achieve order What X.X% no we done finish to in aggressive X, add we unit to about order we in other have order going will X. people that and in

evidence part month ramping July, that did the we X. it think was I Unit And we're of down October now on September productivity that looks for And that. went that up. of August, of really appear our like the So plan. is yeah, it back would in say, We

Drew Evans

move you're site. use complexity completely that, as when that time. Sort referring is see the to I in nuclear concept course X -- Unit and construction, principal a to think of, natural But absolutely you odd focus we a in through idea Unit to move say and of just fair construction. probably will it improvements It's the reduced shouldn't X, of productivity an over

Tom Fanning

to Unit X, recall just of as we that we And had through went lots learning.

things Unit do early And apply we've X push those in I been X, energization, on that there work. to and because on is equipment we able the that. learnings. see we're was so turn-off for that involved the of improve to on and there turn-on of We initial sequencing productivity one did going remember frankly a lot of

Drew Evans

And Unit hot move testing next in year, into Richie, as start of or quarter completion. completion good will we for you of move through construction sets functional provide first -- to work the schedules probably

Tom Fanning

And like it's we on visual Unit of X. where just the I I it's page today. a we X, you really are guess on material gave great

if actually actually additional month, days we're expectation days another know, where You order We that quarter. sure enough, of XX there our has look in it the to end And an It our already it you actual, contingent shows and shows our timeframe. third -- had contingency well, hit to at in shows November the projecting timeframe. there. the be, aggressive XX of the scheduled added expectation we

X provide will for think suggesting as that information, I kind was now. Unit of Drew

Unidentified Analyst

be for X left should months? functional in Unit And I I work there's helpful. now some very then hot the I between data more next couple if to points one it of done, in. but guess, focusing can it. in know, subcontractor the slip here be on just Got operational anything we that testing, terms That's

Tom Fanning

Yeah.

right I think of that I'm mindful kind there's things three now. of very

we feel that actual about terms nomenclature SWAT that assigned engineering of of turnover pretty the I involves are the really built sure a of big is reflected think our reflect making condition to focus, I will and -- that that. team we In good in actually the that systems paper, the plans. as this kind construction, of have the

conform as underestimate and that, works, deal. goes itech call big paper that you built, that. that mean, make just So that's to don't I sure them if the the we underscore engineering, a Don't to that want the that into broadly submit that the

electrical we'll or said have consistently, at Second, particular areas mean like feel do six get pacing we hard to be insulation, is subcontractor a it's functional the one insulated months elevators think to a then past go schedule the we we thirdly, by can We of to have do performance. now. whatever productivity focus what reasonable like the before And we that? site there. through confident And on that. factor. really, continues have through But we three It's the And depth. need be I

again, sure three like it's subcontractor the that. So it's tied things like myths on test a and are making It's the paper, walls of It's whole get are things, seals the sure the performance. involved same that electrical up. in the they are perforations through to we that can make lot functional hot Those effectively.

Unidentified Analyst

very All Thanks right. Perfect. much.

Tom Fanning

Thank you. You bet.

Operator

your on. for Continuing you Thank question.

comes the Shar question of Please Partners. next go line from Our Guggenheim ahead. with Pourreza

Tom Fanning

Hello, Shar.

Shar Pourreza

Good morning. How guys doing? you are

Tom Fanning

Fantastic. are you? How

Shar Pourreza

Not bad. Not bad. too too

Drew Evans

like you're sound You recovering fully.

So that's good.

Shar Pourreza

Yeah.

Tom Fanning

Absolutely.

Shar Pourreza

just a of couple a here. Just quick couple questions

from the came to schedule second quarter when XX%, on XX% contingency So, you in a call. know, was replenished this down cost margin it cost

cost as for trying remaining several amounts the -- to of be assess of it months of we're to schedule, forward sort going highlighted shape maybe, remaining used think of, think to to vice just So in in or on million Is we we Tom, margin your if XX quarter, trying as us more As monitor was front-end track So you'll kind the the the the you've should look the contingencies? months? or for it about should utilizing? kind versa? prepared monitor contingency next of your the during you're we, loaded remarks? – in not over about How sort

Tom Fanning

cost mean, about now. terms there a get contingency, we'll it no of I see I we know use look and we'll think Yeah, to reason everything right think we now. in increase We right

funded One cost the gives contingency, risks, through call Unit we the we for back recall, X and a things of to that comfort, actually if lot you the estimate to where of for of X. lot both increased us a Unit go complete,

a landscape, very has if cost will, respect So abilities reduced. to the with been you really

we're that going now that Now, one that's monitor so the chance does budgets, kind don't XXX take there COD, but loads ways know, something given get XXX could have COVID we to lot into look days, a that probably estimate with we is produced plan the about are – schedules eventually? of on our I've that's to experience estimated that Sure, forward. far, COVID. worse, continuing COVID moreover, a of and account if we've need of – estimate Could of and of you and the more fuel conceivably, we for guided XXX. you we time bit completion to, at we more is our our COVID. had been The like so days it time sort impact, pace thinking Little the about

If think was you compare two, XXX. those XXX. they I were averages, Chinese the The best

that I a maybe think are in put to very around experience, with consistent very, it load term. our planning assumptions COD global fuel

regulatory for we the the to we'll schedule question so answer that and near-term very site is fall in unit. and And between maybe date the the your service likely understand, where

Drew Evans

October, have right? – that's breaking, November, We watched the we somewhere in that. schedule Yeah. There of of I in a somewhere that. don't is know, kind it's there, kind funded

impact third could eye past So our on I if the an quarter. on that get have we'll slipped cost. well, as we Substantially, keep that ever

Shar Pourreza

that. Thank it. Got Perfect. you for

I thinking we've essentially just than of, into of you the are is, narrowed there. Just lot seen at the reality I V-shaped the maybe, i.e., the per know, you we've from and imbedded more players conservative, second, obviously, forecasts have – a just recoveries the maybe reason your backdrop, a a the sort of sort several space impact load territory? the looking forecasting shifting across this the what's of why and you've in seen is that of sort faster plan year, impact on any assuming lot in are But recovery that assumptions a and about mean, the versus recovery how recovery. gradual ask XXXX for revenues just Vogel economic

seeing, as you into are what we Tom, XXXX is head that? think you do around what So

Tom Fanning

Yeah.

I'm X.X% here, to around So estimate look, we're the million. to I going guess XXX XXX we guessing XXX around revenue I'm reduction. to in now million X% reductions, million we're projecting now, of in now three, gave guessing come load COVID

mid year, we assume And recover to that are X% estimates since down year about going we about are the we're think for back the drew a that using we're revenue I expecting, recovery. X%. on what So, probably

people believe puts stuff watch GDP. would all flat morning. you, that I Squawk if But of and this XXXX. following this assume that about Now, all kind That's to what on and us

that's my of Drew? So kind expectation.

Drew Evans

control so than If will recovery but that's only regard have bit with longer, The faster for into we've materially bit year. well is, that duration continuation sort from base out a business you to a for mechanisms a very year. We're be bit the see not out anticipated, to Yeah. depths than a serve the I'd its came we very came through been the cost we the little to pandemic say that cost that get both place integrate XXXX. and little see that or different nuance, you XXXX, put think of a in next likely us may of – of of the we effective I X% and the

lot depressive we've should so to to And the of prove revenue. I be think pathways got a pandemic

in a and than mix industrial though anticipated. thought. Box, different than third different, the very that within important been page negative, impact talked XX quite note The I we're X still the XX think and signs, of of less measurements probably bit little what we little we commercial expansive industrial this taking thing had one to strong, about is what that on although sort Squawk Residential slides, has than much morning, Tom anticipated, we our other been is through of the a was the of sector deeper quarter. generally But bit signs showing as has are positive it's

Tom Fanning

for show all year know, the down, XX repeat segments. the let opportunity quarter. don’t to quarter, and that, all year me, X I first was just can't correct – as Becky was would morning, I And me one do and you third But Hey, now second And statistic segment Yeah. which that that flat. the I was the brain then and over I cramp. flat. said, every and a TV only which improving have derivative, Petroleum gives one said, down, the chemicals some and Live was something, was flat, that on down. was chemicals asked down, down. reason, momentum this you of was a chemicals

one chemicals said So down. just was the and only that I flat, was on the chemicals misspoke call

Shar Pourreza

it. Got

Tom Fanning

the The was rest okay. of answer

Shar Pourreza

it. Thank you. Got

down of obviously is it's to just last just an Obviously, Pritzker's me, may, shift cliff under he a one for did know if and about thinking And mess. highlight you a It's have of Nicor. of repeal versus issue policy sort the agenda, a Just utilizing. bit there a a more guys the one But been that I disaster. I gas of electric annoy issue.

any with find frequent Just your part this more thing, guys rate with this in you agenda? of yourself get sort love cases? share you to seeing Are thoughts his of traction

Tom Fanning

Yeah.

governor So of certainly say a primary experienced in bit case, side the that the different electric What is -- it what a that anything to mechanism within that would rider the rate in about is width have I makes the supportive as they what out our priority little have way the base. than works, of move you something into on rate -- Illinois. they

absorb continued of so we QIP. quite can And call bit so we frequency with that the that actually under do we construction what a

construct don't were that there it necessarily we one and And the at I seek change change behavior two from recovery we that if level, so materially that way in know the customers. even a our state would

Shar Pourreza

Got it. Congrats. Terrific. Thanks, guys.

Tom Fanning

Thank you. it. Appreciate

Operator

Michael line next ahead. Suisse. And you. from Thank of our Please the Weinstein comes go Credit with question

Tom Fanning

Hello, to you. Mike. We're glad have

Michael Weinstein

guys. Hi,

Tom Fanning

Hey.

Michael Weinstein

do to after higher use Hey, first rates? and quantify Vogel's glad And that think ready priorities Hey, to be the you to mentioned, cash be here. would for you'll rate expected achieve growth flow what service? be when growth earnings of higher you that

Tom Fanning

is of a in. think lot baked I this listen, Oh,

we're of Let's past, to just stuff the okay therefore we -- foreshadow it year of But call, and it kind we've was our going end as it. I thought I historically it's to in get covered in earnings guess that you in was do detail which February. great

we've you a investment And Vogel within XXXX. which rate is start, know even earning there's stay that rate in you under worst penalty Vogel rate, essentially guys rate. still for with our The a penalty right the growth year that frankly, to now. As penalty able X% been lot is a of to X%

worth service, penalty per we it we talking rate, start are third have is to we share. now expecting we that move why the large service we numbers XXXX. into the estimating, that's clear fact, on, and from effect in earnings about net we're are, quarter clearing thought of in As XXXX debt to $XXX emerge mix in a the the associated was Vogel into Vogel in full from into million. Vogel with over increases roughly roughly as income a And of rate capitals From

goes per about Now, that, growth rate you share baseline, XXXX I your as your let's up. whether as earnings think way XXXX don't or care our baseline, use

dividend significantly. up goes way And flow cash expect, ratio our capital, payout would down. goes Our our you as

said carry earlier want about But we'll will me what they from to there. February this a after this. as detail decision in to have the dividend give on we've you people great so on calls, And all policy

Michael Weinstein

solution still of environmentalist nuclear earned, consider as seeing after hard I election willingness environment, new new guys Great. the willing ahead, gained part considering the And the on global experience have all the the to accept warming thinking are any nuclear mean, post integral this problem? And additional valuable -- you to part the to years? construction? over you After are of you

Tom Fanning

I Yeah, my Ernest on extensively, on I we States he's thought the would comment think say the leaders I this finish Secretary profile of part as security on not published to one both a by nuclear very great guy in last United that needs for we going under on he way. America, that a a on conversation, matter to it. our sides think up the all. Senate, I consistent development, was it's Michael, Energy approved has nation's prior suggested as the And maintain absolutely. that want of it's to aisle, hey, to energy Hey, XX zero CapEx Hey, the too was to of of us board. national think a just have I nuclear profile credibility of of forward. He's be important clear a Moniz, calls,

think development, a new considered under nuclear And development maybe you new nuclear is saw Saudi and States about know so that Kingdom of United to just recently you, we Poland UAE. signed the Arabia pact with there

will States United the is sense my So continue.

some our is XXs next unit pretty clear we the have when projections, fleet, guess. transition to how would think our about XXs to in Now, we my and nuclear plans about be the probably

those So timeframe back years before you that in to So my be up, how many service? them somewhere X sense. get start years would in

Okay.

of a on American is, of other I lot working on a the important that power, of Gates, therefore you the he you the physical all is, idea spending down. Energy to need of thing not melt that's structures have This The brain new kind it may nuclear money that containment we nuclear whatever are some Bill and and Energy on, therefore cost are with and Forum but being is operating Council. the And don't the next lot of the characteristic generation DOE, of, capital nuclear Innovation down costs. of or things Innovation fuel drive able

stay going invested have we of Look, for Southern think not. the XX the to the involved. -- has of years, United stayed to But nuclear will lots be or Thank think I next this I X I don't years, Senate goodness there's States, to ideas; nation I in eventually. know there SMR. we're stay in whether

Drew Evans

to wanted plan. just future I CapEx, the on thing in say the future of financial last One

Vogel. answer finished my do? talking, I I kind what of finish have do As was you And have hint to a to had of we

have at look modest What doesn't the in that. What you and $XXX you new don't year in examples showing for a stuff. modest more, there my pretty plenty room some placeholders Power, in slide, view is CapEx. million conservative, really We provided If in renewables. for relatively our generation do case. to it you CapEx T&D of execute placeholders There's big see Southern at we're is CapEx a have on to

conservative understand in So to forecast, achieve. we make show this want terms to you forecast, must do when a we of that. is what I you it sure

Michael Weinstein

I what was of kind That’s asking. Yeah,

other see further just there. it of I'll about. was to I'll curious I about kinds So, what questions. be might you leave projects thinking

Thank Okay. you.

Tom Fanning

I to answer is straightforward. relatively though, question think your that

over at in or $X look done content you $X billion $XX the our If XX the the segment, distribution then transmission which billion construction like years, constructions remediation. asset of five being billion very do and durable a we'll a think large per continent is something of mix next of is annum, $XX over worth environmental very the a next that And highly to of most I years, the component our base. important

is And to so fleet. of as we likely be the spend move through next generation modernization of generating the those,

of so pretty over flush kind CapEx for a longer what potential to And is easy time. out the period it's of

Drew Evans

order to growth to everybody rates, the growth showing want to we And assure with respect come plug conservative a rate. is we investment. with reasonably don't to on up CapEx What a when I we're posture in you call, solve

outside. there's probably so And therefore

Michael Weinstein

Thanks.

Drew Evans

bet. You

Operator

your you Thank question. for

proceed. of with Global. Please line Storozynski Seaport Angie Our comes question next from the

Drew Evans

you? Hello are how Angie,

Angie Storozynski

when Doing two great. questions. the almost so post time at Thank unimaginable. from is XX is, Georgia years I Power change you're support that has commission. reading you. off in leadership One But the have huge Well, the happening

of Georgia the PFC. have the changes You potential elections,

about So the for how, the the how Power? the ongoing should and project, management -- Georgia support elections again, it, given at we think change

Tom Fanning

You natural bet. a question. And thanks. And that's

asking. Paul turns waited are and We smarter year. for Pensacola. retirement. it ’XX what, start it to time ‘XX. grandkids. entitled in around we later you till got in his But those of we well Alabama. about prudence, blessed He's absolutely think retire happening. and advance triennial have time as you He's the record a they in and farm he next clock. in desire He do we on thank right is works So of terrific could've to saddle issues, We with home the time filing the well, lot performance sudden next Look, the the like track He's now, all in to fully of know XX was Paul's issues there case. a thought When his in beach to not we a rate in a spend enjoy considering a got somebody start had

and media thing of a Chris both that Paul I today. lot know did The other

I think three. tremendous and make to it expresses on all us of amount by effective Paul a his retirement with confidence fuel load

Affairs, was regulatory at his career. execution served as career. confidence He part Officer. and of involved Power Production Chief of he affairs external of as for to of the in load the expresses has of I Chris filings from had remind fuel of think been for And of responsibility. Georgia Georgia President a and of in monitors in our part External Womack, at everything execute of that all Chris charge in-service. broad else. his was in ability lot you, let me generation a pallet Paul to very He also charge

external So in the system. the what officer we have is top getting you're is, arguably

Georgia, CEO Now at terrific job. will a in he do role the

Angie Storozynski

the Okay, of of us and so we've My the beginning functional is, there's cold going couple of question hydro of be a testing. additional end thank you. that told between weeks to work always hot testing some second

in guys between three, under we're that I steps? Now, talking maybe was identified, during the It's longer that that Is you two elongated that weeks. impression, bit period, that four than testing that. this little something hydro a that cold those

Tom Fanning

in nothing this expected well funny smoothly. the got we done complete, get work pre-work, it in functional hydro the done for we Oh, advance time one that, okay? cold Angie, finally not kind to go more schedule, discussion fabulous. just of test, that we to we day this XX days shade at it testing hydro have so a final argument, What had pre-cold over doing whatever. when hot to because test, of the all will advance, give in kind argument such when went We of no, cold cold it's we test, versus The some test hydro of this did with started of fact, And hydro all. is

the I provide where of pre-work that us very us systematic the way talked with of electrical. us finish they time builts values already the and the easy the things get the paper. a It Some gives deal generally at done approved, the NRC. in process way the use to filing a that in gives time to engineering When to have and XXX, to making more sure is drop paper, before. of ITAAC more therefore, about very been with It specs as meet kind involves UIN

different, not minor But Our far. so that having electrical is than dramatically of been a increase. is experience different. not dramatically we've it is our There pace

the should do absence what of aggressive day. So, and in day, an that get it once to you then plan, that of we risk lower executing to getting see the

Angie Storozynski

that growth in given especially utility that's any we seems comments sort Vogel. online, when have you're every southeast? with would the Vogel it of, electric I about ongoing of app, we about, the potential is day. this, ready consolidation, And But Okay. through in changing think in to now types strategic completely acquisitions? with Should industry, know you future that guys once entertain you the topics, three utilities like, some they any busy sector are don't have

Tom Fanning

us Well, you've loaded some been question. for with that's Angie, now, a time.

then, we a value that bought shareholder done City and the strategic of is think levels The simple the and something in out And And years. we both resources made that formerly from we've and Gas, it multiple over seek sense, would okay? I'm do, us. sales, anything all demonstrated I Company that levels fiduciary standpoint, old been should a buying attractive think you gas Gulf were then, since the Agio accrue at to unprecedented Southern opportunities, So industry. to it Florida remains by if give a true. you gas, have going when responsibility us CEOs, the the great Elizabethtown, response, industry examples It is at was to that, selling, about sold electric for be will have power, we

I the point focused argue time makes us that, to discipline. on going remainder probably well, complete to executing. doubly And and so, that we'll we to be more lot a sense this, rightfully continue Vogel, getting it thing. opportunities consider But we for lots even to of will is big The after for will throughout and caveat After done still maintain forward. have three Vogel do that that, that would is four, that out of you

Angie Storozynski

Perfect. Thank you.

Tom Fanning

Thank you. ahead. Go

Angie Storozynski

Thanks. Operator: you. Thank

question next Angie. joining Our Thanks Thanks A Fanning for Tom us. … -

bet. You

Operator

you. line ahead. KeyBanc. Please next Continuing thank comes on, question from Sophie go our And Karp with of

Tom Fanning

doing? Hello, Sophie. are you How

Sophie Karp

Hi. you Good you me right. afternoon. All a No well quarter. Congrats guys complain? for And Hope are doing also. let on strong thank in.

Tom Fanning

you. Thank

Sophie Karp

about? But maybe already. on, kind you're push that the testing. you that done that the think functional between, in January or kind if that we range discussed you've what factors cold moving can outline been as What it within later of March that now and range? maybe excess some bit of the forwards sooner little or found factors and more are push date should give has us lot with color a follow, hot the So, hydro could a can Well, you are

Tom Fanning

Yeah.

just you if this was Sophie right me, it now. on giving my judgment I'm call

subcontractor sure would order. out laid be I then performance. the it be it broadly So I be And those three would would probably And electrical productivity. paper. And areas. words, then in it other therefore work and risk In maybe did conformed out the sure process the well. the laid that ITAAC as built the on that biggest would we've making be, making engineering with plan condition risk will factor

you process and of we're and value really test. need the for values. do a was plans difference what the the between other much the test was be is NRC to words, get assess the therefore, no provided of if process to the why already in material call that able there's fair, build In able the whole That's to the theoretically, all we So to should so they what then short just engineering for, to to test say amount the accomplish UIN time. fair, drop

you and Southern really go engineering, with is we have work that assure prove ITAAC and actually to call it's the built think to have conformance vector to on team to in of labor you condition our the what have field the we part it, I but as I a think non-manual conformity out have testing in – the and test. with So,

have we've really I wrenches I last whole That high important. week here on can know, you, well. that I tell a at effort, But equipment. now that's room a subcontractors the construction would is all really look, to on focus focused we the and could, areas, have every really sure I I on have of get You go been would making the we of could perform And right going too. could others connecting productivity, one now. think turning well, that this right focus electrical there, that lack the the that those paper We gosh, we don't now. bits three guess

Sophie Karp

Right.

pointed a that's the cold it be so And case. nothing not test. sounds test it could So learned that went gather that hot – from that hydro sounds and could functional you've like you're like from potentially like or well, delay out

Tom Fanning

great. went it no, Sophie,

was all in there's exceedingly went you through In only went I hydro equipment, of XXth the a we finally a it right ran know, we the that all something test, cold of pressurization it activities fact, variances. always test. allowable when on this a achieve test, tolerance We part to and well. the mean, know, killed you like pressurize

Sophie Karp

should of tracking? straight is completion, ITAAC’s or one, terrific. should something the to towards line come them one the we batches expect in to we last a Terrific, of that kind of a sort And timeline more approval, clarify that just in be

Tom Fanning

that out it should fault. like it's monthly, with idea not But I'm that's feel was Yeah, there does milestone. is you sure know, there a our and is associated ratable see some Everything we recall. lumpy it. It batches. some,

start have So in hot are there that functional to testing. we to finish order systems

mean, hundred. As the dismantle we test, There we will essentially will when open ITAAC’s the how the equipment, functional, recall, you other we And you And the finish performed, enough, through successfully to we'll the all to look and are sure we a systems, hot you test then of systems those see perform. those first ITAAC, that. I and check it and if pistons that that's how finished are file stuff see hundred. the lot engine, on next spark the actually the file that final plugs the will, and stock

look So lumpy it to will you.

Sophie Karp

much right. Got you it. so Thank Super appreciate comments. All helpful it.

Tom Fanning

us. for Thank to you. Always good on being you talking with

Operator

Thank you. of Continuing on go our with Tonet next Please question from ahead. JPMorgan. comes line the Jeremy

Tom Fanning

Jeremy. Hi,

Jeremy Tonet

me Hey, on here. thanks for having

Tom Fanning

You bet.

Jeremy Tonet

into announced that. you thinking How future any zero come across should sentiment of about, after get jurisdictions Do the about XXXX southern Vogtle’s recently renewable across kind look opportunities about the all and we here? the little us and how think generally integration a towards the batteries update here incremental footprint integration your that with here, for the just of that of out can renewable you goal want our an solar spending carbon on commission's opportunities bit to you see net give base touch on to want of just to by want that think kind completion know, Just kind period of here. you investment

Tom Fanning

the term sort long with start let's so of Yeah, the plan.

been incremental Those or on one posture. hybrid to to net first I biomass been make capture direct cheaper. to if the words, a think net get come argue end are last to the it generation, adopting the gives net might kilowatt net capture, that's out it zero. electric because zero the think one to transportation, tail or to it either technology, is free. more to us gas In biomass. able be kilowatts United are States carbon made equivalent might would we the zero have were of have at carbon other I that know, hours hybrid, carbon with very – zero flexibility that low were certainly on becomes zero of we I Net We important we

need continue to there. R&D get invest to Now, to we

year. If was the you a look Georgia, Georgia at I Power, say of state utility example, of And have in in state. solar Remember, the the investor-owned for called the there as of by they to out out it it terms mandate fact, been industry considered solar Alabama is and portfolio put some into in be solar. sense in to a will do for upcoming. hearings it has customers. special we good because recently They the and had do no makes that focus want

net even very zero. think I some on plans interesting has gas

certainly of of constructive state, the environmental an I kind customers. the argue would had with past, need, been So understand balancing what's terms so our idea. And our in for best in state

I a think also, brothers to it's this I apart going to you batteries. the my some in do maybe sisters have be know a is little place when said, great consistently. consider and of bit business. of from I the And I think industry. role

material make some batteries solution. We are comprehensive going order advances, to need science to a in

technology, seasonal the fix battery And know even our not the solar. incorporate renewable that to most battery have you maybe its Recall probably not We and for generation. in a technology. months, wind, but profile go therefore winter southeast, pretty during need have to the But period, good summertime, the as seasonal you much you and a you storage you for solar important shorter get strategies.

We're going R&D get advances need out. In But the which on think, to batteries part the they for and us Southern to where of in the for technology. lion's solar That's Georgia make already, XX% battery to to considering share numbers we that I us So for solutions there. I as future. be going have are figure the addressed to to roughly need is in be some we is going solar. got get think renewables, one

Jeremy Tonet

it. that. Got for very that's Thanks Yeah, helpful.

Tom Fanning

bet. You

Jeremy Tonet

thoughts there thinking there about be on a realize And do Power's Is how know to if regards anything I that? here. answer, of gears think difficult then, Georgia question you shifting a Georgia on you but in kind position? any changes to commission kind approach If change, to just is potential we had wants the here? of is should elections this as

Tom Fanning

our Company administration We're Blue the look, there optionality, almost any Southern I if of you over the we a designed that it's Democrat. involved company by the in the healthy played than and communities. holds for People think thing citizens credibility is kind in on sides communities administrations. bottom and I understand the I it's The privileged Mississippi When our been if area. the about bigger to will is this something win Trump being think on are answer. Republican level. thrive aisle, win intertwined of serve. role one the mean, has intertwined have impossible the the operation under the at sides. to in be you inextricably service whether is the has historically, we one have Well, the to line, we Senate of that both And stayed a you well with think development think utility, our Alabama our No premise years and gas a and great for I happens, state. same it we good great that economic states, inextricably, in matter Likewise, of serve our wave? If Georgia a with federal forever, to what does or Southern fine. will, in both Power or the good, as true a do has politicians utility. both is we'll

Jeremy Tonet

much. makes sense. you Thank That Got it. very

Tom Fanning

You bet. Thank you.

Operator

Thank your you for question.

the question next Weisel Andrew Please comes line of Scotiabank. from with your Our proceed question. with

Andrew Weisel

even temporary? words, rebound be you'd to and the Would In Thank reduction we the really like show in natural impactful might the demand down year, much demand more milder did? with right it similar the you question to of of with is, gas skew one the about other starts toward if plants here year this coal weather, you. consistent course, coal should it get is strategy so generation, that decarbonisation. and more My to we be running and and think Quick assume and and pie next chart how look to terms being look in coal XXXX. it

Tom Fanning

Yeah. your correct. XXX% of The is premise question

terrific thing, plant, is chart efficient, it about on stuff. quick, one know Miller in really data it the Power. Plant interesting is highly being real go just through So plant, love a of that I that Half energy, good XX%. Alabama let's what coal I at cheap about point

you? rep is marginal words, that to does it's one Southern The that of here. our is whole portfolio cost X% It than you more the the only What see the gas stack. most that its coal at Company of tell tells other you So is run remaining that in of expensive entire plant. back In energy.

prices are what is was prices some up. One there it? spiked, that coal. in the to see an sway on So things if moves If If demand reason increase may gas you gas some fracking, could go up? however, for some ban

is So in stack the of of your And up that truth waning moves portfolio That's the generation Company of the will are coal. generation. that pressures, supply the to expensive increase pick you more to could Southern if you of inescapable right. demand about line cause But think the importance you pressures, absolutely pressures, with environmental the resources. right, coal generation, if cost

Andrew Weisel

That's helpful. And Great. Okay. then…

Tom Fanning

get I You it? bet. Did

Andrew Weisel

Yep. Yep.

the of think a round or forma a I have out? available? energy two on latest do nuclear do when And units pro pro you mix sort you numbers your thinking XXXX, forma, in what's have are say

Tom Fanning

on something there it hands depending happens coal this Yeah. what happens with Yeah. will like go a get maybe up something about to to wee -- mix. my what and a going this, a in If think do. I I you're Nuclear think, there's and to on I assumption of XXXX see X%. an little bit environmental similar bit, gas with them. But like I'd prices. what

nuclear nuclear marginal is would what cost would XX% Gas extent very on forward. a on drop environmental. large elections with lot something be cheap. maybe going the to So depends really that like And a Coal happens down, of that. depends the

wave, see a but tighter would may have perhaps importance, see. you regulation be it If blue co-waning that we and we'll

importance. I particularly like And we're big Georgia by of to is in The a increase X.X see It'll Power, should you a renewables gigawatts something solar, going see XXXX. be deal. other think big factor

it. the purchase a own Renewables we into advance steady continue or future. whether Now, will it

point big from the the is now, and So now has faster is here been to And to it XX. grown pretty was is XX think is the And I've And a took little Australia getting incorrect I over right the zero hold But don't now, is I size than of XXXX, less a than when we important. numbers. between to still I says say Australia. pretty this me deal. we're company XX, know that go we're have. to it to where big that I this used bit it. round time zero.

steady likely than are with to be percent wind. solar increase to renewable those continue renewables in expect and most rather the So

Okay?

Andrew Weisel

Okay.

will though, XXXX? Just to that than nuclear are saying make soon sure I'm renewables clear, you as be more as

Tom Fanning

fun a set you see an XX% get achieving goal in XX% range. that's Yeah, Sure. XX% said, possibility. I place recall, renewables XX%, if renewables by that reductions is could think plus also And to XXXX. nuclear, up say about and What's into XX% we we've carbon-free. you're interim you're of the

see. I going XXXX even better it's to than could think We'll anyway, be be that.

Andrew Weisel

so you Thank great. Sounds much.

Tom Fanning

sir. Yes,

Operator

Thank you your question. for

comes Our Research. ahead. with the go Fishman from next Morningstar question of line Charles Please

Charles Fishman

Thank you.

Tom Fanning

Hi, for joining. Thanks Charles.

Charles Fishman

bet. You

ask if You've of answered wonder all I long range question. COVID-XX. my sort on Vogel, questions I one could just strategic

You on solar, you capacity build continue a few of you're you'll got to lot building nuclear have a this next coming the situation years, solar. in where

your to of carbon? you're in with you pumps air net like a up that the of makes higher efficient do economical, climate, mild you mild heat more have a lot source the climate. winter, in electrification in to some fact mild that zero about a heating In winter peak It peak. summer thinking is your jealous, Southern respect versus a live discussion does because space are enter us into thought

Tom Fanning

get this, future. know I But electrify does I it everywhere, them catch a Yeah. wrong. many sense Hey, part switching great job for in lot important make electricity, Don't Charles. There's gas cases. an the will no of in have to me

used one is of though, you be case. disabuse the point me peak. to Let and that summer That a

is peaker, a you and being X was have order peaking coming, you're you we needed reliably available two say Alabama, in peaks, of during period And winter penetration it. was in about week. elegant the data. modeling now. next current years in the research, and And waves you there did XX.X% could reserve winter reserve Absolutely, margin a time your used peaker see the about when with warning needs. With what's about grew summer, would could the a you that is if not and particularly it days, a solar you margin in reality, to when need meet we what your old days Alabama summer right generation heat peaker And of old okay? you system. fascinating lots probably we the your So that were to XX% the winter for becoming nail winter was persisted doesn't. better the the how maybe works, a need you space of morning AM it's say kettle really roughly, a very in of peak the over they reserve it XXs, in maybe different plan as margin, At that the now have right? you good fish So And storage, much maybe in

for really Southeast CEO the this well. very in now market AGL right bought we is electric because, now Now, flip important one this right bought to Drew, I what But understands loads, now, that gas the statistics about we AGL Resources, we think and of conversion see Southern really Resources Company right the issues, heating of is over is to I Drew, XX/XX. the want as as versus us

think that go? the question I Drew? so is, interesting And really does where

Drew Evans

do as large. a And it the but I of winter planned, in manage, around say one difficult that little a electricity The is than for I'd interesting. we've with alternative demand because probably say vary to heating sure. that bias of is is greater by volatility megawatts background. fuel a climate it Yeah, that. bit carry is bit sheer And it my an can does more I in be our not It's quite nuance would

has it it highest described, been And so robust Monday good the a done meet by The for high, a electric, and AM it's is the what exactly when though the in which very state peak and that at most lowest in requirements morning There as plan sense has Tom to solar is people prepare where between very in peak have has middle for gas availability direction. competition, work. that you migrated we particularly on exacerbated job. the makes X of Georgia January

in to have gas alternative and we contemplate because heat as do the about that reliability the In its that it's Southeast. base, just Tom an difficult affordability much half could customer of so to as as focus described, natural even electricity electricity across of our jurisdiction, we our and be Southeast really to utilize their And Illinois for efficiency, on more because source. customers

serve. those so, But you to about it sense. will are continued particular limits see be makes realistic where we electrification that have customer And where the we for

Tom Fanning

Drew Absolutely, Yeah. stuff. knows Thanks. his

Charles Fishman

Yeah. source work. competitive not would that's your going in interesting. region? pumps assume in certainly air But to No, are I appreciate I the Illinois, heat Southeast it's

Tom Fanning

many latitudes so the exists, and and everything Atlanta generally if down below you plane. In the move it's where into

Charles Fishman

of in kind nat line, It's right?

Tom Fanning

Yeah. the That's It's making kind call across. what they of down line here. nat

Charles Fishman

Okay.

Tom Fanning

We do it. see

Charles Fishman

That you. was Thank okay. That's helpful. Okay, it. very

Tom Fanning

for Thanks us. it. Appreciate joining Charles. Thanks,

Operator

Thank you.

Our next question comes proceed Patterson from Please the with line of Glenrock Paul your question. Associates. with

Tom Fanning

Hello, always you have with us. Paul, to glad

Paul Patterson

to Good hear.

And And may in PowerSecure. mentioned, things have you earnings in And I about that you. it have it be it big just be strategically think think the call does the I on of I it, But earnings for sold, have should don't negative should you? So driver. we here and left how follow-up a But had future? also, it. you been you've just to look mean, just about how's that it we PowerSecure? is all business A, guys years think You bought know, should is, figure this or does future? significant change few the shaping – think I that how out you you sold just since a I you the I COVID have wanted over guys was wondering, what impact on more

Tom Fanning

we've the young of PowerSecure the called confluence in Yeah, Power, bright it's of Gas part Company actually Southern of Sequent. guy charge a put Southern and

raise, right. have people living, in to does Now, here the that an are their for to site because people is less the but issue, PowerSecure a of have things it's COVID I kind go could involved think get to that impact, likely we travel

large you and think in this scale, business station model energy. selling of we If about have moving century central it making, old iconic

position we and to that on You an influence -- with able it customer PowerSecure as and through miniaturize working be idea to essentially technology bought may put to model, that would premises. the customer requirements recall, changing us

make So in at between. imagine installation. Depot Home sell or you And store, a move defense now a can at and everything

and you the absolutely Paul head. We hit the have on nail

two rid have we We it know be States. XX% our business, kind That lighting of that we is in into fashion statistic if magazine think focused We're proprietary in it that switchgear of micro quote I dated, been got years about PowerSecure this Southern and and It's a would old? that rid like generation. of electric something some grids. anyway. independent we a really power since Company the the what, business. share in equipment but utility putting would move of that microgrids sell And was services it bought the got I'll said of probably, you on United for intersection market responsible

most that's hear you about microgrids, us. when likely So

we into More that the chain. and by through for all I'll customers getting But bet value people make, numbers Now, far way solution move those over that are that decreased just the time. dominant, integrate have I sell remained can market. think,

equipments is integrator people in them that But with fact, of all of importance provider get Sequent gas at and there fuel don't the generation. can. and, really control distributed get procure over electricity production I know in control is, people or of Some all will their stocks, giving it they The will hydrogen with there over and that, some be the people solution. are is fuel we it But mean, how whatever important. in or or of to Sequent natural

that excuse that. deal me, kind United that States, length the charged XX states do their States just our And to I equipment so, trying sense. and microgrid of capability system Kaminsky every arm's state centric think all PowerSecure that power United little makes generation and the in is with the make to we're [ph] making of Southern a And approach isn't, in in sense. Chris centric a virtually we're in of getting broader doing lot the

on learn that our earnings peanut, host happening people's Company It other earnings. virtual of the Southern compared One other PowerSecure’s important utilities a features. big what's to as are deals is

vulnerable more miniaturizing is, and to approach. sell. You're make, this move That

have of areas a weakness of not for areas service do our are strong you companies Those some offering. customer If have – profile, do or cost reliability. strength or for

our in it defensive really oriented those is the and with efforts really the and three is, well It reliability. is we service fortunately, a take whose is Now we of value relies south, an about financial do strategy, price, of But in say -- PowerSecure it union play offensively to always once matter, doesn’t this its poised some oxygen option markets be That's off, and idea. terms That hard and is, in matter. value. those influence. get we our will

Paul Patterson

Okay.

So be should there anything significant that isn’t thinking. any drag we or

Tom Fanning

No.

Paul Patterson

guys impact little a the was hey, mentioned impairment goodwill You quarters that, – And might I on in -- in I like couple accounting, or just might bit even Q. seemed of mean, surprised would an I though, a it goodwill. COVID seemed surprising to your like. there that in I'm it sort mentioned factor in related, that it be last temporary. But, it think which accounting little And of, it sounds have something in general, a separate an That's in… a was sort just

Tom Fanning

would item. kind I Paul, Yeah, say, disclosure it's of a -- it's a I mean,

kind think a minor I of point. it's

described. I I as think interest PowerSecure shareholder is in the real

Paul Patterson

Right.

Tom Fanning

for make, sell the and miniaturizing move idea, future. This

Paul Patterson

Well, power picking grids up. All right. are

are lot a mean, there's I picking mean, I microgrids up. – So,

like be So opportunity. it sounds there could

Tom Fanning

right. quarter Hey. think just They you’re I guess Paul, their Hey, had I ever. best

don't on So, But idea, listen, just our when well. doing the small. EPS increase get PowerSecure. I that, sale they're going mean, -- forecast our we're They're I say to

Paul Patterson

Thanks Good so to hear. much.

Tom Fanning

Thank you. You bet.

Operator

I turn Thank will you. your you will closing that remarks. it for to Fanning, once today's conclude again and answer Mr. question And session,

Tom Fanning

He X him to on Hey, such thanks say? progress great Paul, call Paul give at everybody. space the and the to you exciting X. of us What asked you And, wanted to to the and join end knows just so Bowers to many I call. and I just CFO was times call to a this have want did Vogel everybody's quarter, benefit, join would I know today. like what for Paul us.

Paul Bowers

to make November major confidence outline but about you've the context three how unit impacts thanks context with my the got the Well, to associated regulatory personally, on And retirement. that's our decision also it of or I'll before and about Tom. think retirement, as of the me decision for in decision and date in And company. put of one points is opening, delivering Tom our reflecting a

You quarter in think operation. be it'd think which that about the in period third commercial we

I fuel contemplating and because we're So when signal leadership three. the Tom itself associated for complete load that that's the and timing in transition for about of unit Georgia obvious Power change with I'm with discussed, seen as the and

before a the So with this great honor over in unit it's great as fuel the years. as got in that, we move deliver pointed X, had a privilege in to grow, at think It's concurrent us, And the we what team serve to we not capacities loading we'll I Georgia you about reins lot under continues a us terms our change leadership and but with old. what to have about disclosed as and great Power, Tom you But and future the to of for our different we think Southern customers, Chris be can make as of all Company, of shareholders. out, Womack am and that take getting part leader momentum a forward. and only been

So thanks.

Tom Fanning

Paul. Hey, Okay. thanks,

been champion soon. career an awesome He’s talk great been We’ll stuff. call. whole for to You've on the you here. for friend Great a Any and everybody a leader your thanks Power. the

Operator

concludes this and Thank you. third quarter XXXX Company The earnings Ladies gentlemen call. Southern

great once now disconnect. a Have may you Thank again. day. You

The Southern Company (SO) 29 Oct 202020 Q3 Earnings call transcript