ML20071N600
| ML20071N600 | |
| Person / Time | |
|---|---|
| Site: | Hatch, Vogtle, 05000000 |
| Issue date: | 03/07/1983 |
| From: | John Miller, Scherer R GEORGIA POWER CO. |
| To: | |
| Shared Package | |
| ML20071N587 | List: |
| References | |
| NUDOCS 8306070130 | |
| Download: ML20071N600 (36) | |
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t Georgia Ibwer Company 333 Piedmont Avenue P.O. Ikix 4545 Atlanta, Georgia 30302 Telephone:404-526-6526 Georgia Ibwer Company is an investor-owned electric utility serving 57,000 of the state's 59,000 square miles.The Southem Companyis the parent firm
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for Georgia Ibweras wellas Alabama Ibwer, Gulf Ibwer and Mississippi Ibwer. Together these companies com-prise the Southern electric system.
A a>py of Form 10 K as filed with the Securities and Exchange Commission will be pmvided upon request. A copy of the Company's Financial and Statis-tical Review is also available. Ihquest for these documents may be made by using the postage paid card enclosed in the back of this report. For additional information. contact M r. W. L Westbrook, Senior Vice Pa esident, Accounting and Finance and Secretary 404-526 6526 Registrar, Transfer Agent and Dividend Disbu T,ing Agent All Preferred Stock
'liust Company llank P.O. Ik)x 4625 Atlanta, Georgia 30302 Trustee, Registrar and Interest Ibying Agent All First Mortgage lionds Chemicalllank 55 Water Street New York,New York 10041 DividendsIbid it has been determined that all dividends paid on Georgia Power Company Preferred Stock (including Class A Preferred)for the year 1982, are 100% taxable.
This annual report is submitted as information for stockholders and is not intended for use in amnection with any sale or purchase of,or any offers or solicitation of offers to buy or sell, any securities, except to the extent ina)r-porated by reference in a prospectus.
Cover:
A setting sun silhouettes the sub.
station built at Plant Match as part of the largest 500-kw construction project Ooorgia Power has ever undertaken. The project facliltates theCompany's off system sales to Florida.
Financial (in thousands of dollars) 1982*
1981
"; Change Operating revenues.
S2,157,201 S2.015.810 21.9 Operating expenses.
52,061,211 S1,708,671 20.8 Net income after dividends on preferred stock.
S258,911 8172,091 50.5 Gross property additions.
S912,1-15 8730,.154 21.9 Electrie Opcrations l
Kilowatthour sales (millions).
19,703 47,742 4.1 l
Customers served (year end).
1.272.859 1.219,126 1.9 l
Maximum system peak hour demand (megawatts).
10,683 11,514 17.26 i
Capital Structure Ratios (year-endl l.ong-term debt.
56.1%
57.7"4 I
l' referred stock.
8.1 %
7.7";
f Preferred stock subject to mandatory redemption.
2.5%
3.0t'a Common equity.
33.0 %
31.6";
Return on Average Common Equity.
16.11%
12.11";
Ratio of Earnings to Fised Charges (SEC Method).
2.97 2.73 l
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- In 1982, the Company began accniing revenuesJbrsen ices trndered but unbilled. The atmutative cffeet of this acamnting change as ofJanuary 1,1982, amounts to $21,(X)9,(XX)(net ofapplicable taxes). See Note 1 to thefinancialstatements.
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Table of Contents l
liighlights 1
Letter to investon 2
1982 Achievements 5
Selected Financial Data 12 Management's Discussion 14 I
Financial Statements 16 i
Auditors' Report 26 Reportof Management 27 Directors and Officers 27
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l Lettsr to invectors l
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By virtually every measure,1982 i
g was a good year for Georgia Ibwer j
g Company.
4 Earnings were up,our con-struction program moved forward 4
and new steps were taken toim-prove productivity and the dehvery p,q Netincome surpassed $200 of electricity to our customers.
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million for the first time, rising to
$259 million at year-end.This rep-resents a 16.14 percent return on average common equity.
Electricity sales grew by 4.1 l
percent, resulting in total revenues of approximately $2.5 billion.
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Ourimproved financial per-J l
formancein 1982 can be attributed
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to three main factors:a fullyear of j
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.e increased revenues from the $265
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million retail rate increase granted 2
inlate 1981; revenues from sales to l
utilities outside the Company's terri-tory which totaled $148 million; Rthert W. Scherer, James H. Miller, Jr.
and an accounting change to record revenues for services rendered but unbilled. Due to this accounting change, net income increased l
$23.5 million.
i Notwithstandinglast year's i
financial advances, careful manage-l ment willcontinue to be necessary l
in 1983. Asincreased operating and capitalcosts exceed the 1981 rate increase, earnings will shrink unless new rates are obtained to I
offset rising costs.
A challenge for the future will I
be our ability to market first mort-l gage bonds and prefened stock.
We must maintain earnings suffi-cient to attract the required debt and equity capital.If our revenue requirements are not achieved,our construction program willhave to be financed through alternate means.
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To ensure that our revenue needs j
are met,we filed March 7,1983,for 1983. Meter readers now use hand-a $319.5 million retail rate increase held computers to record and trans-with the Georgia Public Service mitmeterreadingdataforcustomer Commission.
billing.The portablecomputers Our construction program replace the conventionalmethod moved forward significantly in 1982.
of handwriting meter readingson The first of Plant Scherer's four paper documents. Terminals store units wentinto commercialopera-data for meter reading routes,in-tion,the Plant Vogtle nuclear facility cluding names, addresses, meter was 40 percent complete by year-locations and other specialized data.
end and work accelerated on the The process not onlyincreases pro-Rocky Mountain project. Total con-ductivity but is also cost effective.
struction costs for 1982 were $912 Allen B. Wilson retired during million.Expendituresin 1983 will 1982,and his position as executive rise to approximately $1.25 billion.
vice president-finance was filled Our fossil fuel plants set a by Warren Y.Jobe. It is our sad new equivalent availability record, duty to note the death in July of
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exceeding the 80 percent mark.
W.A.Widner, vice president for fos-Plant efficiency also remained high.
siland hydro generation.
By either measure, Georgia Power Our broad objective for 1983 plants continue to enjoy sound is two-fold.First,we must maintain a
ratings.
and advancetheimportantgainswe A key thrustin the past year have madein recent years toward a was toward heightened participa-strong position ofleadershipin the tion by allpersonnelin sustaining electric utility industry. Secondly, we the Company's progress and pro-must vigorously pursue profitable ductivity. A program called People marketsandadequateratesinorder Achieving Excellence (PACE) was to preserve our financial health.
instituted.The most visible empha-As always,this willbe a family sis of the programis quality circles effort, calling upon all the strengths
-smallgroupsofworkemwhomeet and talents of our personneland to solvejob-related problems.Some theloyal support of ourinvestors.
75 qualitycircles were fonned by r hesecondconsecutive NO year, the Company's all-time safety Robert W. Scherer record was surpassed. Also for the Chaimian of the Board and l
second year,a comprehensive sum-Chief Executive Officer mer pr' gram was sponsored for o
i Georgia youth,for which the Com-pany received national recognition.
The energy services depart-es H. Miller,Jr.
ment was reorganizedin 1982 a,nd President given a new name:retailmarketing.
March 7,1983 i
Earlyin the year,a new program waslaunched to re-emphasize com-panywide responsibilities for high-l quality customer service.
i Following a test programin 1982, Georgia Pbwer instituted mmputerized meterreadingin early l
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1C82 Achinvamsnts l
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M billion. A unique feature of the F
agreements allows short tenn bor-s rowings to be convenedinto temiloans.
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Off-System Markets Expand m
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ii-Off-system sales continued.to rise in size and importance for Georgia Powerin 1982.
Revenue fromlong tenn con-tracts amounted to $148 million, a considerableincrease over the
$82 million recorded the previous year and the $56 millionin 1980.
" Economy" sales to utilities outside the Georgia Power territory
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also contributed to earnings during 1982.These unscheduled and un-certain sales are made from time i
to time when other utilities find it 8
Electricity Sales Up imately S16.5 million went in effect more economical to purchase elec-e rly in the year,and an additional tricity from Georgia Power rather One factor contributing to the Com.
$12.5 milh,on wholesale rate settle-than operating theirown plants.
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[ljt city ment became effectivein early 1983.
These sales amounted to $36 mil-s, h
e e up for A new territonalpeak for hon dunng 1982.
the third straight year.
winter usage was established on In 1983, Georgia Power began Kilowatt-hour sales to utilities outside our tenitory almost doubled, Janu ry 11,1982, when demand realizingincome froma new fonn of r se to 9,797 megawatts. The sum-off-system sales, called unit power from 2.6 billion in 1981 to 4.9 bil-lion in 1982. Total kilowatt-hour mer peak was 10,683 megawatts, sales.These long term Southern registered on August 25. This was electric system contracts callfor sales rose to 49.7 billion,a gain of 4.1 percent over the previous year.
gell under the record setin the pre-dehvery of electricity from gen-vmus summer,when temperatures erating units at specific s,tes-in i
Revenue perkilowatt-hour was 4.9 cents-a 17.2 percent increase were unusually hot.
the case of Georgia Power, Plant Toa,idtheCompany, financ, g Scherer. Unit power sales will re-m m
over 1981. Despite the upward its constniction program, Georgia duce, m part,the " economy' trans-swing, Georgia Power's residential Powercompleted two S125 million actions and the sales made under rate.s continued to rank among the first mongage bond issues,the first earlier,long tenn contracts.
.j mi ed in 1981, retail I"3"I} and the second in October.
Most of Georgia Power's off-Additionally,the company raised system sales are made to Florida rates were notchanged during 1982.
- S7a, lhon through the sale of utilities that depend heavily upon A wholesale mteincrease of approx-preferred stock in September. Tax-oil. As a result, the sales contribute I
Originating at Plant Hatch, two exempt pollution Control revenue sebstantially to the national energy 12s. mile soo-kv lines, left photo, bonds totaling $135 million were goal of conserving oil. Georgia link the Southern electric system issued inJune and December. Addi-Power's 19820ff-system sales saved with bulk power sales customers tional capital contributions from the purchasing utilities an estimated proIucYn[Georg$a Po The Southern Company totaled 10 million barrels of oil.
er s ar of the electricity being sold
$191 million.
through unit power sales contracts.
To provide additional financial flexibility, the Company has revolv-ing credit agreements for S1.5 i
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The nuclear plant's first unit l
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and the second the following year.
v g.4 N When finished, Plant Vogtle will
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'. p in the Southern electric system. Its 1
7 be thelargest singleinvestment l
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capacity will be 2,320 megawatts.
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Construction was also accel-l erated during 1982 at the Rocky l
Afountain pumped storage plant.
hlajor tunnel work started,and the s
848 megawatt plant is now about i
10 percent complete. It is scheduled l
for completion in 1987.
Construction Progresses Another hydroelectric project, the expans,on of Bartletts Ferry, i
p With nearly S1 billion budgeted for got underwayin 1982.The addition construction during 1982, Georgia of 108 megawatts willalmost triple i
Power advanced new coal, nuclear capacityof the 65-megawatt Chatta-l h
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and hydro units toward their com-hoochee River plant. Completion R
pletion dates.
is scheduled for 1985.
The first of Plant Scherer's Control room simulators were l
four generating units went into installed at Plants Hatch and Vogtle.
l service in Afarch. Unit 2 is about The computerized simulators are three-fomths complete and is sched-used for training key plant person-l uled to go into commercial opera-nel, and the Hatch simulator was
.A tion in early 1984.
used in the plant's annual emer-Scherer Units 3 and 4 arein gency drill. Plant Scherer also has their early stages,with completion a control room simulator.
l At sett, a steam generator is posi.
expectedin 1987and 1989.The During the year, two 500-i tioned before being lifted into the Work force at Plant Scherer cur-kilovolt transmission lines con-l Unit i containnsent building at rently numbers 2,000.
necting with Florida utilities were l
Plant Vogtle. Construction activity When complete,Scherer will finished wellahead of schedule and l
uclear facit!:"y, topYho be thelargest plant operated by under budget. Total cost of the
, during Georg,a Power, with a capacity of Georgia segments was $70 milh,on.
i 1982. Unit 1 at Plant Scherer, above, near Juliette, Ga., went 3,272 megawatts.
The two new lines improve relia.
into service in March 1982. Unit 2 At Plant Vogtle, activity bility of transmission and distribu-
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is scheduled to go into operation stepped up considerably. From a tion systems in southeast Georgia in early 1984.
previous level of about 4,500,the and strengthen electrically weak work force was expanded to 8,000.
interconnections with Florida.
Shifts are operating almost con-Work began in the closing tinuously, seven days a week. Con-months of 1982 on transfomling stmctionis on schedule and was the historic Alacon railroad terminal 40 percent complete at year-end.
into space for the Alacon division A significant development at headquarters and a variety of com-Vogtle during 1982 was the arrival mercial tenants.The renovation of one of the world's largest mobile schedule calls for occupancy by l
cranes.The giant craneis being division headquarters in 1984.
used tolift major plant components, including a 500 ton reactor dome,
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Solar Projects Shine parabolic dish collectors, each measuring 23 feet across,is the L
For Georgia Power,1982 was the largest solar cogeneration facility i.
Yearof theSun.
in the world.
t Three major research and The field of giant collectors i
development projects went into supplies steam, air conditioning,
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operation to advance solar tech-and electricity to an adjacent knit-nology in residential, commercial, wear factory and meets more than and industrial settings.These three half of the clothing factory's annual projects, coupled with other Georgia energy needs.The solar systemis Power solar programs, clearly put capable of generating up to 400 the Companyin the vanguard of kilowatts of electricity and 1,300 elecuic utility efforts to harvest kilowattsof thermalenergy. All energy from the sun.
power not needed by the factory is j
7 Future I, the nation's most fed into the Georgia Power system.
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extensively monitored photovoltaic The acre-and-a-half array of A
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home,was dedicated in April and nearly 1,500 solar collectors at e
quickly attracted widespread Georgia Power's new corporate g.
l 1-attention.The contemporary brick headquarters wentinto servicein l
W dwelling, located in Roswell,was October,after several months of the cover storyin theJuly edition modifications and start-up testing.
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cf McchanirIllustrated, was fea-The solar array supplies some 15 tured in the November issue of percent of the heating, cooling,and w-Home, and was the subject of hot water requirements for the numerous newspaper articles.
headquarters, and serves as the l
About a third of the roof of the nation's largest solar application for Photovoltaic panels on the roof of a Commers wing.
VoltalC panehng capable of pro-Georgia Power's solar research house, Future I, at left and top, duCing 4.1, kilowatts.When the l
help produce electricity directly photovoltaiccells produce more from the sun's rays. The contem-energy than Future I needs,its ver-1 porary brick house in an Atlanta satile microComputerchannels the suburb la the nation's most exten-excess electricity to the Georgia
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sively monitored photovoltaic home Future I can produce more Power system and credits the
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electricity than it uses, cut energy amount to Future I's account.
consumption and automatically When Future Iwas dedicated, control appilances for efficient plans called forkeepingit open to
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use. Parabo:ic solar dish collec-the public for six months. Because l
Sors, bottom photo, track the sun at Shenandoah, in a cooperative of unexpectedly high pubh,cm, ter-effort to further America's search est-85,000 visitors by the year's for new sources of energy.
end-the open-house period was extended into 1983.The home will
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be closely monitored afterit is occupied by a family to see howit The five-acre field of parabolic t
I performs from day to day under solar collectors marks the world's normal conditions.
largest soiar cogeneration facility.
The mdustrial solar project, The Solar Total Energy Proiect at Shenandoah, dedicated in May, is located just south of Atlanta at capahio o, generating up to 400 Shenandoah,was dedicated on a kilowatts of electricity.
brilliant sunny morning in May.
The gleaming five-acre field of 114
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PACE Program Begins Thelarge-scale summer youth independent steps torepairand prograniestablishedin 1981 wasex.
weatherize their homes, Georgia Continued development of our tended and expanded. At the same Power n, utiated a new program most vital resource-the 14,000 time, new program waslaunched called SemorCitizens:Lendmg people who work for Georgia t we thenze the homes of elderly A Helping Hand.
Power-received strong emphasis customers.Several other projects Under this new program, d"fi"E 1982-demonstrating the Company's social Georgia Power funiishes weatheri-In August,the Company im-concerns also were undertaken.
zation material and workers to install plemented a new program called The 1982 summer program it.The eligible Georgia Power cus-Peopb AChievmg Excellence was enlarged toreach five Company tomers must own and occupy their PACE).The new program's most divisions,in addition to the Atlanta homes and be atleast 65 years old.
visible emphasis is upon quality division.The summer program And the workers engaged to arcles.of which 7a were formed by again involved temporary employ-make the repairs andinstallations year-end. (In quality circles, small ment for young men and womenin are also senior citizens. Numbering groups of workers meet to solve need ofjobs, day camps forinner-about 200, they were given two problems encountered on the job.)
city youngsters,and chaperoned days of trainingand are paid hourly Otherimportant aspects of the trips to Atlanta Braves games for compensation.
PACE programinclude an mtemal groups from day camps and com-The workers pmved to be g
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cleannghouse forexchangingideas munity organiziitions.
energetic and enthusiastic. By year's forimprovmg performancelesels; In 1982, the summer pro-end,they had weatherized 8,000 y
an in-house consulting group t gram touched about 7,000 young homes-which was 2,000 more help achieve performanceimprove-Georgians-more than double the than the goal set for the year.
ments;and a study to determme number who participatedin the In addition to making con-l ways and means ofimproving 1981 program.
tributions to several dozen educa-customer service. Company man.
The 240 temporary employees tionalinstitutions, Georgia Power i
l agement and union leaders are again were given training classes entered into contracts with various cooperatmg m the effort to attain.
and job counseling.Two new under-universities to support teaching l
supenorcompanywide productivity takings were added in 1982. Ten and researchin fields ranging from and performance.
summer employees worked on im-biotechnology to marketing.
As was again demonstratedin provements at an Atlanta environ.
In September, Chairman 1982,the Company s safety pro-mental education center,and 32 of Scherer was one of two dozen cor-gramis accomplishing outstand.ing them worked on weatherizing 972 porate executives invited to the 4
results. For the second straight Atlanta public housing units.
White House toreceive recognition year, a new companywide safety Earlierin 1982, realizing that for outstanding programs of sum-record was set.
many elderly customers were phy-mer youth employment. In early sically or financially unable to take 1983, Alr. Scherer received a letter Reagan Praises Company from President Ronald Reagan commending the Company for both i
%,ith the national economy and the summer youth program and the unemployment nsing, Georgia
.i senior citizen helping hand project.
Power Company stepped upits long.
Alr. Scherer also received an award standing tradition of commuraty from the U.S. Department of Health l
mvolvement during 1982.
and Human Services which recog-nized the Company's outstanding f
The PACE philosophy-those who do the work can best suggest Community service projects.
ways to do it better-is reflected in both the quality circles and the A senior citizen helps weatherize problem-solving teams at Plant the home of another senior citizen Vogtle.
In the " Lending a Helping Hand" project.
Selected Finrn::ial Drta (dollars in thousands)
Years Ended December 31 1982' 1981 1980 1979 Condensed Income Statement:
Operating Revenues.....
S 2,157,201 S_2,015,810 S 1,808,408 8 1,519,942 Operat;ng Expenses:
Depreciation and amortization.
1,622,200 1,326,359 1,087,389 935,210 Operation and maintenance.
162,796 157,336 153,245 133,888 s
Taxes other than income taxes.
93,271 83,780 73,454 67,736 Federal and state income taxes.
I85,9 l 1
_ 141,196 178,03_2 118,424 Total operating expenses.
2,061.211 1,708,671 1,492,120 1,255,258 Operating income.
392,990 307,139 316,288 264,684 9 7,9(18 76,222 71,974 67,119 Other Income, Net.
Income llefore Interest Charges.
190,898 383,361 388,262 331,803 Net Interest Charges..
206,195 170,901 157,693 151,505 income llefore Change in Method of Recording Revenues 281,103 212,460 230,569 180,298 Cumulative effect as of January 1,1982 of aaruing unbilled revenues, less income taxes of $22,320,000.
23,009 Net Ineome......
307,i12 212,460 230,569 180,298 Dividend an Preferred Stock...
18,168 40,366 35,224 34,786 Net income After Dividends on Preferred Stock..
S 258,9II S 172,094 S
195,345 S 145,53 T
_. = =
= = =.
==
Pro Forma Net income after dividends on preferred stock assuming change in method of recording revenues was S
235,935 S
175,515 S 1 %,709 S 140,706 applied retroactively.
Cash Dividends Declared on Common Stock.
S 151,700 S 131,000 S 136,400 S
131,100 Return on Average Common Equity (perceno.
16.11 12.41 15.47 12.21 Total Assets.
S 6,159,663 S 5,271,846 S 4,728,977 S 4,341,295 5 Capitalization:
S 1,751,186 S 1,458,240 S 1,314,315 S 1,210,868 Common st<ck equity.
132,811 357,844 357,844 357,844 c Preferred stock....
12 Preferred stock subject to mandatory redemption.
135,000 138,674 67,500 71,250 1 ong-term debt.
2,997,760 2,667,372 2,326,627 2,168,272 Total capitalization.
S 5.316,790 S 4,622,130 S 4,066,286 S 3,808.2M Gross Property Additions....
S 912,1-15 5 7 30,454 f~ ~590,5$9 5~ 607,516
~
Kilowatthour Sales (in thousands):
Residential.
11,075,560 11,153,588 11,297,518 10,340,375 Commercial.
9,890,108 9,464,443 9,184,086 8,735,947 16,203,691 16,813,165 16.299.666 16,225,971 Industrial....
7,312,957 7,361,961 7,127,310 7,632,216 Sales for resale.
Other.
320,893 306,724 294,700 246,055 Total tenitorial sales.
11,833,209 45,099,881 44,203,280 43,180,564 Sales to utilities outside tenitory..
.l,869,513 2,6_42,54_7
._ 2,102,461
. 43.234,692 54,128 Total kilowatthour sales.
19,702,722 47,7_42,428 J,305,741 Operating Revenues:
Residential.
S fil5,289
$ 540,004 S 514,860 S 414,500 Commercial..
625,i16 499.653 454,049 386,176 711,085 608,713 547,256 488,044 lndustrial....
Sales for resale.
281,206 251,572 205.030 204,280 19,139 15,428 14,169 10,971 l
Other.
Total revenues from tenitorial sales.
2,285,165 1,915,370 1,735,364 1,503,971 Revenues from sales to utilities outside tenitory.
I17,565 82,048 56,911 1,261 Total revenues from sales of electricity.
2,133,030 1,997,418 1,792,275 1,505,232 18,392 16,133 14,710 21,171 Other revenues.
s l
Total operating revenues.
S 2.157,201 S 2,015,810 S_ 1,808,408
$ 1,519,942 Aserage Revenue Per Kilowatthour-Total Sales (cents).......
1.90 4.18 3.87 3.48 Average Cost of Fuel Per Kilowatthour I.81 1.66 1.51 1.42 Generated (cents)....
Customers (end of year).
1.272,859 1,249.126 1,215,714 1,192,770 Employees (end of year)..
11,076 13,451 13,034 12,522
- In 1982. the Company began acendng n venuesfbrsen ices armicord but unbilled. Sec Note 1 to thefinancialstatements.
Certain prioryear amounts have been arclassified to con)bnn n ith cunrntyearpresentation.
Georgia Nwer Company 1978 1977 1976 1975 1974 1973 1972
$ 1,475,024
$ 1,301,237 S 1,170,046 S 1,079,175 S 787,919
$ 603,116 S 511,361 921,465 813,987 690,953 615,343 515,497 338,966 287,370 118,208 109,944 100,347 89,677 80,087 68,552 57,041 65,3M 58,939 53,630 46,548 37,203 30,806 27,154
. _ 126,953
_ _,118,514
_ 94.,64_5
. _ 109,007
_ _ 8,213
_ _ 33,145
._.29,421 1
471,469 400,986 1,231,990 1,101,384 939,575 860,575 M 1,000 243,034 199,853 230,471 218,600 146,919 131,M7 110,375 52,510 67,400 62,857 75,188 65,631 47,939 32,935 295,544 267,253 293,328 293,788 212,550 179,586 143,310 129,050 125,087 144,348 136207 126,665 91,525 67,366 166,494 142,166 148,980 157,581 85,885 88,061 75,444 I65,4 T4T,I 1485 0 157,581 85,88
- 88,061
~tSJ44
~
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30,480 30,480 27,862 18,451 17,190 17,190 12,299 8
136,014 S
111,686 S
121,118 139,130 S
68,695 S
70,871 S
63,145 l
$ 137,236 3 117,086 S
121,978 S
142,763 S
69,094 S
73,354 S
64,116 S
119,225 S
109,400 S
100,400 S
100,000 75,700 62,100 51,000 12.04 10.51 12.06 14.90 8.16 9.86 10.59 l
S 4,084,794 S 3,803,627 S 3,591,063
$ 3,352,590
$ 3,263,623 S 2,626,5M S 2,182,435
$ 1,173,036 S 1,086,247 S 1,038,961 S 969,057
$ 898,397 S 785,402 S 652,631
}
307,M4 307,M4 307,844 257,844 257,844 257,844 257.844 l
75,000 75,000 75,000 75,000 13 l
1,953,553 1,880,798 1,827,470 1,757,541 1,514,705 1,247,160 1,102,952 l
$_3,509,433
$ 3,349,889 S 3,249,275
_S 3,059,442 S 2,670,946
$ 2,290,4_06 S 2,013,427 6 500,719
$ 534,153 S 404,435 S 438,097
$ 662,683
$ 524,397 S 474,317 10,829,488 10,470,674 9,512,592 9,260,034 9,013,966 9,147,452 8,193.456 8,827,281 10,278,012 9,712,599 8,795,788 8,508,118 8,506,755 7,686,139 15,682,025 13,236,290 12,629,263 11,654,106 12.296,202 12,270,130 11,390,884 8.580,211 9,617,229 9,262,454 9,095,581 8,590,045 8,305,948 7,146,068 226,113 216,621 213,058 204,009 197,065 184,263 175,388 44,145,118 43,818,826 41,329,966 39,009,518 38,605.396 38,414,548 34,591,935 157,013
_ 43,818,826 41,329,9_66
_39,009,518 38,605,396 38.,414,548
._34J48,948 44,145,118 8 417,696
$ 358,933 S 315,226 S 301,541 S 223,417
$ 185,171 S
155,614 369,808 385,889 355,405 317,879 233,342 187,624 158,709 449,719 328,407 290,983 275,591 194,962 143,129 121,132 213.319 203,914 191,110 166,777 122,316 74,527 61,938 9,856 8,957 8,542 8,012
_ 6,688
_ _ 6,327 5,68_9 1,460,398
,,_1,286,100 1,161,266 1,069,800 780,725 596,778 503,082 2,977 1,460,398 1,286,100 1,161,266 1,069.800 780,725 596,778 506,059 t
14,626 15,137 8,780 9.375 7,194 6,338 5,302 S._1,475.024 S 1,301,237 S 1,170,046
.S 1,079,175 S 787,919 S 603.116 S 511,361 3.31 2.94 2.81 2.74 2.02 1.55 1.46 1.37 1.27 1.12 1.11 0.91 0.53 0.47 1,164,822 1,138,470 1,112,063 1,083,646 1,078,223 1,051,842 1,018,684 12.067 11,485 10,194 9,052 9,385 8,599 8,224
l Managsmsnt's Di:cuaci:n and Antlycis cf Rasults cf Opsrc,ti=ns and Finansial C:nditi n Results of Operations creased from $4.3 million in 1980 to S305.4 million in 1982.
This increase was primarily the result of the purchase of Georgia lbwer's net income after dividends on preferred stock enngy fmm jointly owned plants m accordance with con-for 1982 was $258.9 million.This represents a 16.14% retum tractual agreements. Additionally, at times encrgy was avail-
}
on average common equity which is an end of period record ble fmm the Southem electric system power pool at a more for the Company. Earnings for 1982 increased $86.9 million economical cost than the Company,s cost to produce equivalent or 50% over 1981 earnings and 33% over 1980 results. Net energy.In dditvm. fuel costs mcreased 16% from 1980 to income for 1982 was increased by $23.5 million due to a change
- 82. Hgever, under fuel cost recovery mechanisms, the in the Company's method of recording revenues, including S23 Company is entitled to recover the actual cost of fuel bumed million applicable to the cumulative effect of the change as and the energy p>rtion of purchased power transactions.
of January 1,1982. See Note I to the financial statements for Increases m deprecation and amortization each year are a further discussion of this change.
due pnnapally to the cont, ued gmwth in depreaabte plant m
Operating revenues have increased in each year, princi-pally as a result of rate increases, recovery of increased fuel
" S##V'.ce. The comp > site straightyme depreaation rate was pproximately 3.6% m 1982,3.7% m 1981, and 3.8% m 1980.
oysts, and increased energy sales. Retail revenues increased uctuatmns in mcome taxes resulted from changes m 31% over the period 1980 through 1982. The most signifi-pre-tax income. Federal and state income tax provisions are cant increase for this period was in 1982 which reflected a detailed in Note 5 to the financial statements.
full year of increased retail rates awarded in late 1981. Resale The allowance for funds used during construction rep-revenues, including off system sales, increased by 65% from 1980 to 1982. This increase was primarily the result of in-fesents Q W d caphal for utility plant under construc-creased energy sales, particularly to off-system utilities, and ton,which is presently not mcluded in rate base.The equity p>dion f this credit represents non-cash income. Ilowever, the effect of Georgia wholesale rate increases granted in 1980 nonnalization of the income tax effect of the debt portion t$1 Company kilowatthour sales increased 4% in 1982 results in a non-cash charge egainst income. In addition, a sigm6 cant portion of cun ent cash flow results from the return and 3% in 1981 for a cumulative increase of 7% from 46 billion n, nd recovery through depreciation of,previously capitalized kilowatthours in 1980 to 50 billion kilowatthours in 1982.
amounts. The allowance for funds used during construction, The primary reason for this increase was additional sales to net f income taxes, as a percent of net income after dividends off-system utilities.The combined 1982 demand of the Com-pany's customers and the customers of Oglethorpe Power
[ d2 p
n 98 '
14 Corp > ration (OPC),the Municipal Electric Authority of Georgia Due to increased long-term borrowings and higher inter-(MEAG), and the City of Dalton reached a summer peak of est rates, net interest charges have increased 31% to $206.5 10,683 megawatts and a new winter peak of 9,797 mega-million in 1982 from $157.7 million in 1980.The Company's watts. The 1981 summer and wmter peak demands were first mongage bonds issued in 1982 carried interest rates of 11,514 and 9,19a megawatts.respectively.
16%% and 13%%, while interest rates rani;ed from 16%% to Total operation and maintenance expenses, including fuel 17%% for bonds sold in 1981 and were 14%% for bonds sold and purchased power, contmued to increase in 1982 due to in 1980 increased energy production and the effects ofinflation.These Infiation has continued to have an adverse effect on the expenses totaled $1.6 bilhon m 1982,an increase of 22% over Company due to regulatory constraints and the large invest-1981 and 49% over 1980. Net purchased power expenses m-ment in utility plant. See Note 9 to the financial statements for supplementary information concerning the approximate effects of inflation.
The results of operations discussed above are not neces-sarily indicative of future eamings. It is expected that higher operating costs and carrying charges on increased investment in plant,if not offset by proportionate increases in operating revenues (either by periodic rate increases or increases in sales), will adversely affect future camings. In recent years, eamings have tended to decline during periods following the full 12 months' realization of general rate increases and prior to the receipt of funher rate increases. Future increases in sales will be affected by the rate of economic growth in the Company's service area, the elasticity of demand, energy con-i servation practiced by customers, the weather and various market conditions applicable to neighboring utilities. The Company has entered into agreements with cenain Florida and Texas utilities for capacity and energy sales during the period 1983 through May 1995. See Note 4 to the finan-cial statements for more information on these agreements.
L
Financial Condition ending December 31,1990. During the tenn of these agree-ments,y Company (at its option) may convert short-temi Ltal gross property additions for the period 1980 through 1982 totaled 52.3 billion. These additions included construction of pnowmgs mto term hians. Such tem 11oans would be payable
- *E' 4"
ments dunng h years M major generating projects,and the constructing and upgrading through 1993, or at an earh.er date (at the Company s option).
of transmission and distnbution lines, substations and other Also, the Lompany has $80 milhon m imes of credit subject to facilities. Gross propeny additions were financed primarily annual renew 1. No short term bank hians were outstandmg by a net increase of $840.4 million of long tenn debt, $138.2 t year-end.
million of preferred stock, $338 million of common equity To issue additional first mongage bonds and preferred contributions from The Southern Company and the sale of stock,the Company must comply with certain camings cover.
$406.6 million of undivided interests in certain generation and tran3 mission facilities.The balance of the funits was pro.
ge requirements contained in its mortgage mdenture and vided from internal sources. See Statements of Sources of porpor te charter. An earnmgs coverage of two times annual Funds for Gross Property Additions for further details.
!nterest charges on first mortgage b(mds is required for the The Company's capitalization ratios have remained ap-
!ssuanceof additionalbondsandoneandone-half timesannual interest charges and prefened stock dividends is required for proximately the same in recent years. The Company's com-the issuance of additional preferred stock.The coverages, m-mon equity ratio was 33.0% at December 31,1982, as com-cluding the 1982 change m method of recording revenues, for pared to 31.6"; at the end of 1981 and 32.3% at December the years ended December 31,1982 and 1981, were 2.31 and 31,1980.The composite interest rate on long-tenu debt has for preferred stock. If the cumulat,.64 and 1.50, respectively 1.99, respectively, for bonds and 1 increased from 8.10% at December 31,1979 to 10.01% at ive effect of the change m December 31,1982, and the a>mposite dividend rate on pre-method of mo>rding revenues were not included, these cover-ferred stock has increased from 8.22% to 9.79% during this ages for the twelve months ended December,1982 would be
>d
$upany estimates that it will require approximately 2.13 for lxmds and l.58 for preferred stock.The improvement m coverages is pnmanly due to improved earnings m 1982
$4.4 billion for gross property additions during the period resulting from the effects of retail and wholesale rate mereases 1983 through 1985. These financing requirements may be granted m late 1981 and early 1982, respectively, and to reduced if certaia proposed sales of undivided interests in increased energy sales to off system utilities.
generating units are consummated, as discussed in Notes 3 The ability to maintain these coverages togenerate funds and 4 to the financial statements. The cmstruction pmgram for day to-day operr.tions and to finance the construction pro-15 is subject to revision depending upon such factors as the gram is dependent on receiving adequate and timely rate in-granting of timely and adequate rate increases, revised esti-creases.The Company is committed to maintammg its financial mates of costs, revised h>ad forecasts, and the availability and integrity by cutmued emphasis on operating efficiency and cost of capital. At December 31,1982, substantial purchase by vigorous pursuit of rate increases when appropnate.Should commitments were outstanding in connection with the con-dw Company be unable to obtain funds from extemal sources stmetion program and for the purchase of coal and nuclear n am unts which, together with intemally generated funds, fuel under long tenn contracts.
will be adequate to carry out the present construction pro-in addition to the funds required for the construction pro-gram, delays or cancellations of cenain projects o>uld become gram,approximately S66.2 million will be required by the end
"'C**S '%
of 1985 in connection with the present sinking fund require-ments and maturities of long term debt and prefened stock subject to mandatory redemption as discussed in Note 6 to the financial statements.
It is anticipated that the funds required will be derived from sources in fann and quantity similar to those used in the past. Ilowever, the type and timing of financing will depend on market conditions and maintenance of adequate camings.
At December 31,1982, the Company had $536.6 million of tempoiary cash investments to assist in meeting cash re-quirements. In addition, as of January 1,1983, the Company had revolving credit agreements for $1,565,000,000 with eleven banks. The agreements cover the eight-year penml o
Cclinca Chxt2 in thousands Georgia Power Company December 31 1982 1981 ASSETS Utility Plant Plant in service, at oiiginal cost....
S3,118,877
$4,985.354 Less-accumulated provision for depreciation..
1.107,106 1,270,841 1,011,171 3,714',513 I
Nuclear fuel, at amortized cost......
132,533 100,720 Construction work in progress (Note 3).
1,188,323 1,166,482
'llital.
5,682,329 4,981,7l'5 Less - property related accumulated defened income taxes t Note 1).
686,723 613,765 l
Tital.
1,995,606 4,367,950 Other Property and Investments Southern Electric Generating Company (Note 41.
I6,100 16,400 Nonutility property, net.
1,031 3.381 Total.
20,131 19,781
~
Current Assets Cash.
5.323 8,059 Temporary cash investments,at cost..
536,609 336,100 Receivables-Customer aco>unts receivable.
181,155 161,297 Accrued unbilled revenues (Note 1).
17,267 Other accounts and notes receivable.
39.216 50,771 Affiliated companies...
8,339 12,237 Accumulated provision for uncollectible accounts.
(1,816)
(2,000)
Fossil fuel stock, at average cost.
266,-189 257,101
.\\laterials and supplies, at average cost.
37,682 37,014 Prepayments.
5,011 3,909 T>tal.
1,125,563 864,488 Deferred Charges go Debt expense, being amortized.
S,592 7,631 hliscellaneous.
9,166 11,996 Tital..
I8,038 19,627 Total Assets.
S6,139,663 S5.271,846 CAPITAL.lZATION AND LIAllli.lTIES Capitalization (See accompanying statementsHNote 6)
Common stock equity.
S1,731,186
$1,458.240 Prefened stock......
132,811 357,844 Prefened stock subject to mandatory redemption.
133.000 138,674 long term debt.
2.997,760 2,667,372 Total.
5,316,790 4,622,130 Current I.iabilities Prefened stock sinking fund requirement (Note 6).
3,008 Long-term debt due within one year (Note 6).
13,773 22,502 Accounts payable-Affiliated companies.
I3,216 12,760 Other....
219,316 143,571 Customer deposits.
30,323 28,310
'Ilixes accrued-Federal and state income (Note 1).
Other.
32,873 32,000 15,708 36,515 Interest accrued.
82,515 66,594 l
hliscellaneous.
26.113 22,319 l
T>tal.
IS8.907 361,601 Deferred Credits, Etc.
Accumulated deferred investment tax credits.
318,293 278,488 hliscellaneous.
5,671 6,627 l
Total.
333.966 285,115 Commitments and Contingent hiatters (Notes 3,4 and 7)
Total Capitalization and Liabilities.
56,159,663
$5.271,816 Certain prioryear amounts have been reclassified to amfonn icith cwentyearpresentation The acannpanying notes are an integralpart of these statements.
(
)
Ct;t;ments of Crpitriizati:n in thousands Georgia Power Company December 31 1982
% of Total 1981
% of 'Ibtal Common Stock Equity Common stock (without par value) authorized 15,000,000 shares, outstanding 7,761,500 shares..
S 311,250
$ 344,250 1
Other paid-in capital...
990.800 799,800 Premium on preferTed stock,.
2,837 2,703 Farnings retained in the business.
I13,299 311,487 Total common stock equity.
1,751,186 33.0 %
1,458,240 31.6%
Cumulative Preferred Stock (without par value) authorized 26,000,000 shares, outstanding 9,578,439 shares l
Class
$100 stated value-
$4.60 to $6.60 Series.
I17,811 117,814
$7.72 to S7.80 Series..
105,000 105,000 88.20 to $9.08 Series.
35.000 35,000
$25 stated value-
$2.52 Series.
50.000 50,000 S2.56 Series.
50.000 50,000 S3.44 Series.
75,000 Total (annual dividend requirement 837,670,000)..
-132,811 8.1 357,844 7.7 Cumulative Preferred Stock (without par value),
subject to mandatory redemption authorized 6,000,000 shares, outstanding 5,520,300 shares 1
$25 stated value-
$2.75 Series.
63,00s 63,674
$3.76 Series.
75.000 75,000 (annual dividend requirement S18,211,000)
Less amount due within one year.
3,008 Total, excluding amount due within one year.
135,000 2.5 138,674 3.0 lamg-Term Debt First mortgage bonds 31aturity Interest Rates July 1,1982.
. 3%To.
20,000 April 1,1983. 3%%.
8,073 8,073 April 1,1984.. 3%To.
I1,000 11,000 Slay 1,1985
. 3%To.
I1,988 11,988 April 1,1986. 3%To.
12,000 12,000 June 1,1987.. 5%To.
8,978 8,978 1988 1992.
. 4%To to 17%%.
I91.000 194,000 1993 1997.
. 4%% to 6%%.
I89.86S 189.868 1998 2002.
. 6%% to 11%fo.
792,239 792,269 2003 200e.
. < 4% to ll%To..
105,96S 405,968 2008 2012.
. 9%fo to 16%%.
925,000 675,000 Total first mortgage lxmds..
2,559.I11 2,329,144 Otherlong-term debt.
ISO.201 379,925 j
Unamortized debt premium (discount), net.
(25,782)
(19,195)
Total long term debt (annual interest requaement $308,816,000).
3.013,333 2,689,874 Less amount due within one year.
15,773 22,502 Long-term debt, excluding amount due within one year.
2,997,760 56.I 2,667,372 57.7 Total Capitalization (Note 6).
55.316,790 100.0 %
S4,622,130 100.0_%
The am>mpanying notes are an integralpart of these statements.
CtctsmantscfInc m2inthousands Georgia PowerCompany Years Ended December 31 1982 1981 1980 S2,157.201
$2,015,810
$1,808,408 Operating Revenues.
Operating Expenses Operation-Fuel....
828,310 811,038 716,566 Purchased and interchanged power, net..
305,-137 73,566 4,324 Other...
313,817 280,3M 222,155 Maintenance......
171,606 161,351 144,344 Depreciation and amortization........
I(12,796 157,336 153,245 Taxes other than ino>me taxes...
93.271 83,780 73,454 Fedeml and state income taxes (Note s)...
185.911 141,196 178,032 Total operating expenses...
2,061.211 1,708,671 1,492,120 392,990 307,139 316,288 Operating income.....
Other Ineome Allowance for equity funds used during construction.......
70,593 48,690 35,663 Gain on sales of facilities (Note 4)...
6,939 29,282 12,891 48,038 25.552 Interest inoime..
Other. net..
92 582 4,047 Ino>me taxes applicable to other income.
(22,607)
(21,088)
(22.570) 190,898 383,361 388.262 Income beforc interest charges...
Interest Charges Interest on long-term debt.
267,863 213,278 186.210 Amortization of debt discount, premium and expense, net..
1,256 929 805 2,185 3,162 10,741 Other interest charges......
Allowance for debt funds used during constmction.....
(65,109)
(46,468)
(40.063)
Net interest charges........
206,195 170,901 157,693 Income llefore Change in Methmi of Recording Revenues..
281,103 212,460 230.569 13 Cumulative effect as of January 1,1982 of accruing unbilled revenues, less income taxes of S22,320,000 (Note 1)..
23,009 307,112 212,460 230,569 Net Income.
18,168 40,366 35,224 Dividends on Preferrul Stock.
Net income after Dividends on Preferred Stock.
S 258,9l1 S 172.094 S 9g'145 Statements of Earnings Retained in the Businessin thousands Years Ended December 31 19S2 1981 1980 S 311,187
$ 271,629 S 212,714 Ikdance, beginning of period.
Add (deduc0:
258.9 I i 172,094 195,345 Net income after dividends on preferred stock...
Cash dividends paid on common stock...
(l5-1,700)
(131,000)
(136,400)
Prefeired stock issuance expense.
(2,132)
(1,236)
(30)
S 113,299
$ 311,487
$ 27h629 Ikdance,end of period (Note 6).
Statements of Other Paid-In Capitalin thousands Years Ended December 31 1982 1981 1980 llalanee,beginning of period..
S 799,800
$ 696,800
$ 652,800 Cash contribution to capital by parent onmpany..
191,000 103.000 44,000 S 990,800
$ 799,800
$_696.8_00 Italanee,end of period.
The amimpanying notes are an integralpart of these statements.
Ctntsminta cf Courc:o cf Funds fcr Grc2s Prensrty Additiuns in thousands Georgia Power Company Years Ended December 31 1982 1981 1980 Sources of Funds for Gross Property Additions:
Net ino>me.
S307,112 8212A60
$230,569 Add (deduct) principal noncash items-Depreciation and amortization.
191,391 183,633 185,206 Deferred ino>me taxes. net...
129,331 91,080 79,343 Deferred investment tax credits...
78,183 55,875 40,823
_ 35,663)
Allowance for equity funds used during a;nstruction.
(70,593)
._ 48,690)
(
(
635,730 494.558 500,278 Less-Dividends on common stock...
151,700 131,000 136,400 Dividends on preferred stock...
18,158
_ 40,366
, 35,2_ 4.
2
- 192 328,6_.54
- 323, 132.562 Decrease (increase) in net current assets, excluding long-term debt and preferred stock due within one year-Cash and temporary cash investments........
(197,773)
(132.028)
(154,360)
Receivables..
(52,116) 83,392 (126,376) i Fossil fuel stock....
(9,388) 8,251 (20,011)
Materials and supplies..
(668)
(6.639)
(2,675)
Revenues to be refunded.
(1,569)
(3,498)
Accounts payable.
76231 (23,522) 17,676 30,066 (40,920) 61,858 Taxes accrued.......
l Interest accrued.,.....
15.921 11,739 2,819 Other. net.
1,707 6,571 1,709 (133.050)
(94,725)
(222,858)
Other, net (including allowance for equity funds used during o>nstmction).
(2.109)
(15.392)
(5,518)
Totalinternal sources.
297,003 213,075 100,278 19 External Sources-250.000 300,000 75,000 First mortgage bonds....
4 l
Ilonds retired or refunded at maturity.....
(20.030)
(24,970)
(20,000) 229,970 275,030 55,000 Preferred stock..
75.000 Preferred stock subject to mandatory redemption.
75,000 l
Preferred stock reacquired......
(666)
(6,401)
(4,695)
Cash contributions by parent company.
191,000 103.000 44,000 SG,191 67,584 40,673 Pollution control obligations...
(
Increase in otherlong term debt..
1,082 3,166 68,682 Sales of facilities net book value (Note 4).
19,562 387,021 l
Total external sources......
615,112 517,379 590,681 l
Gross Property Additions (includes allowance for funds l
used during construction in the amount of $103,642,000 in 1982, S72,277,000 in 1981 and $55,776,000 in 1980).
S912.I 15
$730A54
$690,959 l
l l
Certain prioryear amounts have been reclassified to conform icith currentyearpresentati<m.
The acwmpanying notes are an integralpart of these statements.
N:t:a to Finan&I Ctst:m:nta December 31,1982,1981,and 1980
)
'ote 1. Summary of Synificant Accounting Iblicies amortized to fuel expense based on the estimated thennal units utilized to generate ekctric energy. This amortization was GENERAL The Company is a wholly owned subsidiary of
$15,728,000 in 1982, $15,395,000 in 1981 and $20,756,000 l'he Southem Company which is the parent company of four in 1980. Final disposition of the spent nuclear fuel may require operating companies, a system service company and Southem adjustments to fuel expenw. Pending ultimate disposition, suf-Electric International, Inc. (SED. The operating comparaes ficient storage capacity for spent fuel is available at Plant provide electnc semce m four southeastem states. Contracts
!!atch until the year 2000. On January 7,1983, the President among the companies-deahng witlyomtly owned generating of the United States signed the Nuclear Waste Pblicy Act relat-facilities, mterconnectmg transt.mston imes, and exchange of ing to the storage of spent nuclear fuel by the Federal govern-electnc power-are regulated by the Federal Energy Reg-ment. The Company is presently reviewing this legislation and ulatory Lommissmn (FERC) or the Secunties and Exchange Commissmn. The system service company provides, at cost, does n.ot expect the Act to have any material impact on its fin ncialstatements.
technical and other specialized services to The Southern Com-pany and to each of the subsidiary companies. SEl, which was PENSION COSTS. The Company has a trutteed and non-fonned in January,1982, markets to utilities and industria!
contributory pension plan which covers substantially all reg-concerns the technical expertise of the Southem electric sys-utar employees. The policy of the Company is to fund each 2
tem in planning and operating electric power facilities.
year's accrued pension cost for the plan which amounted to The Southem Company is registered as a holding com-
$41,216,000 in 1982, $36,818,000 in 1981, and $18,377,000 pany under the Public Utility llolding Company Act of 1935.
in 1980.Of these amounts,$26,080,000in 1982,$23,522,000 lbth The Southern Company and its subsidiaries are subject in 1981, and $11,618,000 in 1980 were charged to operating to the regulatory provisioas of the Act. The Company also is expenses, and the bt.iance was charged to constmction and subject to regulation by the FERC and the Georgia Public other accounts. Amendments to the plan in 1981 liberalized Service Commission (GPSC). The Company follows gen-retirement benefits, including increased tenninal pay fonnulas erally, uccepted accounting principles and complies with the and expanded benefits to employees. The effects of these accounting policies and practices presaibed by the respective amendments were a net increase of $101,541,000 in the commissions.
accrued liability with respect to past service under the plan i
and an increase in the 1981 contribution of $13.296,000. Ac-UTil.IT Y Pl. ANT. Utility plant is stated at original cost. This cumulated pension benefit infonnation as of the valuation cost includes appropriate aiministrative and general costs; dates (January 1 of each year) follows(in thousands):
I m'
payroll-related costs such as taxes, pensions, and other bene-fits; and the estimated cost of funds used during construction.
i982 i9si The cost of maintenance, repairs, and replacements of minor Mafiai preint vaiuel.f accumulated '
items of property is charged to maintenance expenre accounts.
plan benefits The cost of property replacements (exclusive of minor items Vested....
5202 o6:
$175,852 Nonvested.
3.839 3,100 of property)is charged to the utility plant accounts.
Total actuarial prewnt value of REVENUES. To match more cbsely revenues and expenses, accumulated plan benefits.
5203,903
$178.952 in October,1982 the Comp my began accruing revenues for weighted average rates of retum service rendered but unbilled. Prior to 1982, the Company assumed in detennining aduarial recognized revenues concurrent with billings to customers on present value of accumulated a cycle billing basis. This change increased 1982 net income plan benefits..
m 8;
by $498,000 before the ct.nulative effect as ofJanuary 1,1982.
Net assets available for benefits.
52'i3,176
$213,141 The cumulative effect, less income taxes of $22,320,000, amounted to $23,009,000 and is included in 1982 income.
The actuarial present value of accumulated plan benefits 1
The amounts of net income after dividends on preferred stock was determined on the basis of accmed benefits as of January I for the years 1982,1981, and 1980 as reported and on a pro of the respective years, whereas the plan is funded based on forma basis, assuming the change had been applied retro-the premise that the plan will continue in existence, which actively, would be as follows (in thousands):
requires that future events be considered. The unfunded prior
~..
service cost under the plan and supplemental contracts 1082 1981 M
amounted to approximately $106.566,000 at December 31, f
E"'
Aft
- ivdends 1982 and is being amortized over a period of appmximately ed k
As Reported..
5258,984
$ t72,094
$195,M5 15 years.
Pro Forma.
5233,935 5175.515
$196,709 DEPRECIATION, Depreciation is provided on the original FUEL COSTS. Fuel costs are exp(nsed as the fuel is used.
cost of depreciable utility plant in service, principally on a The Company is authorized by state law and FERC regula-straight-line basis over the estimated composite service life of tions to recover fuel costs.and net purchased energy costs the property. The depreciation provisions approximated 3.6%,
through fuel cost rec >very mechanistns whid; may be adjusted 3.7% and 3.8% of the average cost of depreciable utility plant as necessary to reflect increases or decreases in such costs.
during 1982,1981, and 1980, respectively. Such provisions Revenues are adjusted for differences between recoverable include a factor to provide for the expected cost of decommis-fuel costs and amounts actually recovered in current rates.
sioning nuclear facilities. The Company's portion of the cost The cost of nuclear fuel, including a provision for the esti-of decommissioning these jointly owned facilities, based on mated cost of anticipated pennanent storage of spent fuel,is ciecommissioning promptly after the unit is taken out of service,
is estimated at appEimately $32,000,000 each for the two taxes) and ref'ect the Company's present ownership percent-units at Plant flatch. This estimate will be adjusted periodically age in all generating units under constmction. The above con-
.to reflect changing price levels and technology. When property stmction estimates will be reduced if certain proposed sales subject to depreciation is retired or otherwise disposed of in of undivided interests in generating units (shown below) the normal murse of business, its cmt together with its cost are consummated.
of removal less salvage, is charged to the accumulated pro-1983 1984 1985 vision for depreciation.
Estimated constniction (Thousandsof Dollars)
INCOM E TAXES. The Company foliows deferred income tax expenditures assuming a(xnunting for all income tax timing differences. Investment no property sales..
$1,250,449 $1,515,464 $1,645,478
$"*pr "p M
~
~ tax credits utilized are deferred and amortized over the aver-age lives of the related propeity. The Company is included saleof anadditiona!4%irterest in the consolidated federal income tax return filed by The in P! ant %gtle to the Mur.idpal Southern Company. Provisions for property-related deferred Elecuic Authority of Georgia income taxes (e.g. accelerated cost recovery and liberali7ed Udlj,$; gig (15859)
(33559)
'38787) depreciati6n) reflect consumption of part of the value of the sdierer t' nits 3 and 4 to Gulf plant and equipment to which they relate. Consequently, they Pbwer Company Guly 1,1983).
(24.544)
(83,075)
(76,074) are similar to depreciation provisions, and the related accumu-Estimated gross property lated defe:Ted income taxes, like the accumulated provision additions assuming above for depreciation, is a valuation reserve deducted from the plant property sales.,
$1,210.046 $1.398,830 $1,530,617 investment in aniving at the rate base used in rate-making pmreedings. Other deferred income taxes are included in The construction program is subject to revision depend-taxes accrued. See Note 5 for futther information regarding ing upon such factors as the granting of timely and adequate income taxes, rate increases, revised estimates of costs, revised load fore-casts, and the availability and cost of capital.
ALLOWANCE FOR FUNDS USED DURING CONSTRUC.
The Company's gross property additions are expected TION ( AFUDC). AFUDC represents the estimated debt and to be financed from the issuance of prefe:Ted stock and long-equity o>sts of capital funds which are applicable to utility term debt, the receipt of common equity contributions from olant while under construction. For 1982 and 1981, the AFUDC The Southern Company, asset sales and internal sources.
g rate was adjusted monthly and compounded semi-anneally Should the Company be unable to obtain funds from such meth-and ranged from 8.72% to 9.11% and 7.72% to 8.60%, respec-ods of financing, the Company would have to use short-term tively, net of income tax. The net of income tax rate for 1980 indebtedness or other a!ternative and possibly costlier means was 7.87";. The Company accounts for the income tax effect of financing cr it could become necessary to cancel or delay of capitalized debt cost as a charge to income tax expense certain construction projects. As of January 1,1983, the Com-associated with operations and a correspondti:g credit to allow-pany had revolving credit agreements for $1,565,000,000 with ance for debt funds used during construction. The income tax eleven banks. The agreements cover the eight year period effect of capitalized debt cost was $32,060,000, S22,F81,000 ending December 31,1990. During the term of these agree-and $19,909,000 in 1982,1981, and 1980, respectively.
ments, the Company (at its option) may convert short term bonnwings into te m loans. Such term loans would be payable VACATION PAY. Consistent with the rate-making trea9nent in twe e epial quarterly instanments during the years 1991 prescribed by the GPSC, the Company recognizes employee through 1993, or at an earlier date (at the Company's option).
vacation owts in the year vacation is taken. At December 31, Additionally, the Company has $80,000,000 in hnes of credit l
1982 and 1981, the Company's employees had earned, but not subject to annual renewal. In connection with the credit agree-taken, approximately $18,000,000 and $15,600,000 of vaca-ments and the hnes of cred,it, the Company has agreed certain fees and/or mamtam compensating balances w l
tion, respectively. In each subsequent year, approximately ith the l
34% of the cost of vacations will be capitalized.
banks. These balances are not legally restricted as to with-l drawal by the Company. Average compensating balances dur-Note 2. Rate Proceedings:
ing 1982 were approximately $7,023,000.
To supply a portion cf the fuel requirements of its gen-l New partial requirements wholesale rates have been appmved erating plants, the Company has entered into various long-l by the FERC to become effective February 1,1983, and are term commitments for the procurement of fossil and nuclear designed to mcrease the Company's partial requirements fuel. In most cases, such contracts contain provisions for price wholesale revenues by approximately $12.5 milhon armually, escalations, minimum production levels and other financial l
commitments. Additional commitments for coal and nuclear Note 3. Construction Program, Financing and Fuel fuel will be required in the future to supply the Company's l
Commitments:
fuel needs.
The Company is engaged in a continuous constiuction pro-Note 4. Facility Sales and Joint Ownership Agreements:
l gram and presently estimates gross property additions to be l
approximately $1,250,449,000 in 1983; $1,515,464,000 in Through December 31,1982, the Company had sold undivided l
1984; and $1,645,478,000 in 1985. These additions inciude interests in Plants flatch, Wansley, Scherer and Vogtle in allowance for funds used during construction (net of income varying amounts, together with transmission facilities, to i
Oglethorpe Power Corporation (An Electric Membership Electric Generating Company (SEGCO), which owns electric Generation & Transmission Corporation)(OPC), the Munici-generating units with a total rated capacity of 1,019,680 kilo-pal Electric Authority of Georgia, a public corporation and an watts, together with' associated transmission facilities. The instrumentality of the State of Georgia (MEAG), and the City capacity of the units has been sold equally to the Company of Dalton, Georgia, In 1982 and 1980 such sales resulted in and Alabama Power Company under a contract expiring in gains, after income taxes, of $3,873,000 and $7,425,000, 1994 which, in substance, requires payments sufficient to pro-respectively. There were no such sales in 1981. In addition vide for the operating expenses, taxes and debt service, includ-the Company has signed a contract to sell a 25"6 interest in ing a return on investment, whether or not SEGCO has any Plant Scherer Units 3 and 4 to Gulf Power Company, an affili-capacity and energy available. The Company's share of such ate of the Company, and is negotiating to sell an additional amounts totaled $74,066,000, $77,773,000, and $70,067,000 interest of approximately 4% in Plant Vogtle to MEAG. The in 1982,1981, and 1980, respectively, and these amounts are consummation of any future sales is subject to all requisite included in purchased and interchanged power in the State-governmental approvals, completion of satisfactory financial ments of Income.
arrangements by the proposed purchasers and, except for the At December 31,1982, the capitalization of SEGCO con-proposed sale to Gulf Ibwer Company, the completion of agree-sisted of $32,800,000 of equity and $48,843,000 of long term ments satisfactory to the respective parties. At December 31, debt on which the annual interest requirement is $3,880,000.
1982, the Company's percentage ownership and investment Through December 31,1982, SEGCO had paid dividends in these jointly owned facilities, exclusive of nuclear fuel were equal toits net income.
as follows(dollarsin thousands):
Total IVrcent Construction Note 5. Income Taxes:
Megawatt Company Plant Work m capacity ownership in service Progress A detail of the federa'. and state income tax provisions is set E.1. llatch forth as fAlows(in thousandsk Nuclear Plant..
1,630 50.1%
$516,928 $ 62,491 Plant Wansley.,
1,779 53.5 288,448 464 19g3 1931 1980 Plant Scherer t' nit Nos.1&2..
1,636 8.4 40,906 34,610 Total provision for income taxes Facilities.
23.5 61,418 5,281 u ently payable..
$ 13,083 $ 7,912 S 61.387 Deferred.
Nuclear Plant..
2 320 50.7 1,139,034 159,827 107,161 90.089 2
Defened in prior years uredio.
(18,009) i27.8521 (20.586)
Deferred investment tax credits..
78,183 _ 55,875, 40.823 Each participant provides its own construction financing.
203 088 183.096 174._713 The Company includes its proportionate share of plant operat-State-ing expenses in the corresponding operating expenses in the currently payable..
10.271 7,417 16.049 Statements of Income. The Company has contracted to com-U"Nin prior years ured'iti N85)
N>
$.b plete those jomtly owned units still under construction and 27,787 19.188 25.889 to operate and mamtain the umts as agent for the jomt owners.
,gy g.,
g.g In connection with these sales, the Company has agreed tyy _
to purchase declining fractions of OPC's and M EAG's capacity Income taxes charged to other income 22,607 21.088 22.570 and energy of the respective generating units during a period Income taxes associated with of up to ten years following commercial operation, with the pay.
the cumulative effect as of ments for such capacity made whether or not any capacity is h""gg yjg _m,
l y
available and the payments for such energy to be at cost. The Federaland state income taxes energy cost of such purchases is a function of each entitys charged to operations.
s185.9 u $141.m6 s178.032 vanable operating costs. The cost of such capacity and energy is included in purchased and interchanged power in the State.
ments of Income. The capacity payments totaled $115,374,000,
$38,330,000 and $48,240,000 in 1982,1981, and 1980, respec-Deferred income taxes result from the Company's use of tively. For units cutTently in service, the estimated cost of capac-accelerated methods of depreciation and other write-offs of ity for the next five years is as follows: $116,300,000 in 1983; property costs, as provided for by the income tax laws, being
$99,700,000 in 1984; $75,600,000 in 1985; $56,800,000 in greater than the book depreciation of such costs. Other defer-1986; and $41,900,000 in 1987.
red income taxes are provided for certain costs or revenues that The Company and its affiliated operating companies have are recognized for income tax purposes in different periods entered into agreements with certain utilities regarding the than for book purposes. Income taxes deferred in prior years purchase of coal-fired generating capacity from Plant Scherer are credited to income when the book depreciation of property and other units of the Southem electric system. The contract costs exceeds the related tax deductions or when other timing periods are 1983 through May,1995. The capacity sales from differences reverse. The amortization of deferred investment Plant Scherer over these periods range from 412 megawatts tax credits is applied as a credit to reduce depreciation in the in 1983 to 1,931 megawatts in 1989, with substantially lesser Statements of Income and amounted to $8,377,000 in 1982, amounts during 1993,1994 and 1995.
S7,027,000 in 1981, and S5,163,000 in 1980.
The Company and an affiliate, Alabama Power Company, The total provision for federal income tax as a percent of own equally all of the outstanding capital stock of Southern income before income tax amounted to 39.8%, 40.2%, and
l 43.1% for 1982,1981, and 1980, respectively. The difference 5.95"a due November 1. 2003..
I1.000 41,000 between the 1982 and 1981 rates and the federal statutory 9 00";due september 1,2005..
30.000 30.000 rate of 46% was due primarily to the exclusion from taxable 6.75"; due November 1. 2006.
10.800 40.800 income of the allowance for equity funds used during con-
$.;dM"p'jii)[3..,
2 structmn (6.4% m 1982,6.3% m 1981). In 1980, the pnmary 7.lo"; due Ixcember 1. 2008.
73.000 75.000 reasons for the difference were the exclusion from taxable 13.75";due october l. 2011.
30.000 50.000 1
income of the allowance for equity funds used during construc.
13.50"e due June 1,2012......
90.000 11.50"a due December l. 2012..
35m00 tion (4.0%, the lower capital gains tax rate on asset sales (2.6%), offset by the excess of the tax gain on asset sales over u 7,5 m 282300 I"" f""d*"n deposit with Trustee.
13.229 6.423 the book gain (4.2%).
372,27]
276;o7]
Capitalized lease obligations-Note 6. Capitalization:
Railcars.......
17.696 19.357 Corporate headquarters building.
83.1o I 76,617 COh1510N STOCK DIVIDEND RESTRICTIONS. The Other office buildings.
5.039
~~ioi, sis 5.524 Company's first mortgage bond indenture contains various io3,339 common stock dividend restrictions which remain in effect Nue payable-6*;due through 1986..
loll 2.50 so long as the bonds are outstanding. At December 31,1982, uso.201 $379.925
$186,073,000 of retained eamings was restricted against the
=== -
=
payment of cash dividends on common stock under the most restrictive temis of the mortgage indenture.
The Company has authenticated and delivered to tmstees The tenns of the smkmg funds for the Company's pres-an aggregate of $382,500,000 of its first mortgage bonds ently outstanding $2.7a and S3.76 Class A Preferred Stock which are pledged as security for its obligations under pollu-prohibit the payment of cash dividends on common stock,dur-tion control and industrial development contracts. No interest ing a default in the performance of the smking fund obligations.
on these first mortgage bonds is payable unless and until a The Company's charter limits cash dividends on common default occurs on the installment purchase or k>an agreements.
sterk to 75% of net mcome available for such stock dunng a No principal payments are due on the contracts prior to 1988.
prio,r period of twelve months if, calculated on a, corporate The 11.50% series bonds are secured by a subordinated basis, the ratio of common stock equity to total capitalization, interest in specific property of the Company, mcludmg retamed earnings, adjusted to reflect the payment Assets acquired under capital leases are recorded in the 23 of the proposed divide,nd,, is below 25% and to 50% of such Company's Balance Sheets as utility plant in service and the net mcome if such ratio is less than 20%. At December 31, related obligation is classified as other long-term debt. The net 1982, this ratio was 33%.
book value of assets acquired under capitalized leases was S103,091,000 and $99,290.000 at December 31 of 1982 CUhlULATIVE PREFERRED STOCK SUBJECT TO hl AN-and 1981, respectively. At December 31, 1982, the com-DATORY REDEhlPTION. The $2.75 Class A Preferred posite interest rate for the leased rail cars was 9.56%, the Stcrk has a cumulative sinking fund provision requiring the interest rate for the corporate headquarters lease was 8.23%
redemption of 150,000 shares annually at the stated value of and the composite interest rate for the other leased buildings
$25.00 per share until all shares are redeemed. The Company was 5.42%.
&,o has the option to purchase and cancel the required num-The current portion of the capitalized lease obligations ber of shares annually. At December 31,1982, the Company and the note payable for each year through 1987 is as follows:
had reacquired 29,700 shares of the 1983 sinking fund require.
S2,701,000 in 1983; $3,310,000 in 1984; $3,638,000 in 1985; ment leaving an additional 120,300 shares which must be S2,837,000 in 1986 and $2,195,000 in 1987.
redeemed in 1983. The gains on the reacquisitions of S134,000, in October 1980, the Company capitalized the lease of its
$1,067,000 and $532,000 for the years 1982,1981, and 1980, new corporate headquarters building. The lease agreement respectively, are included with premium on preferred stock provides for payments which are minimal in early years and in the Statements of Capitalization.
escalate through the first twenty years of the initial term of The Company issued 3,000,000 shares of S3.76 Class A the lease. For the first six years, the lease payments are not Preferred Stock in 1981. On or before June 1,1986, and sufficient to cover the interest requirements. The accrued annually thereafter, 150,000 shares must be retired thmugh interest in excess of the lease payments is included in the lease the operation of a cumulative sinking fund at the stated value obligation. Beginning in the year 2009 the aggregate lease of $25.00 per share.
payments will be sufficient to cover the accrued interest and begin to reduce the capitalized lease obligation. For rate-making purposes, the GPSC has treated the lease as an operat-O'l' LIER LONG-l'ERhl DEBT. Details of other long-term debt ing lease and has allowed only the building's lease payments are as follows(in thousandsk in cost of service, rather than the true economic cost of the building. The difference between the accrued expense and the 1982 N
lease payments allowed for rate-making purposes is being obligations incurred in connection with deferred as a cost to be recovered in the future. At December exem hlfuiI r
31 of 1982 and 1981, the amounts deferred and included in n
trial development revenue tnnds-plant in service in the Balance Sheets are S17,187,000 and 13.25';due June 1,2002..
s 10.000 s -
$8,958,000, respectively.
4 LONG TERM DEBT DUE WITillN ONE YEAR. The ment power in the amount of $2,500,000 per week (starting
$15,773,000 of long-tenn debt due within one year at Decem-26 weeks after the outage) for one year and $1,250,000 per 1
ber 31,1982, consists of $8,073,000 of first mongage bonds week for the second year. Under each policy, the Company j
maturing in 1983, the current pr>rtion of other long tenn debt is subject to retroactive assessments if losses exceed the i
and the cash sinking fund requirement.
acumulated funds available to the insurer under that policy.
The annual first mortgage bond sinking fund require-The present maximum assessments for the Company for each ment (1% of the sum oflxmds authenticated prior toJanuary 1 policy year would be approximately $12,000,000 under the of each year) amounts to $32,266,000 and is due on or before replacement power policy and $4,000,000 under the property June 1,1983. The Company anticipates satisfying this require-damage policy.
ment thmugh the use of bonds specifically authenticated for such purpose against unfunded pmperty additions equal to Note 8. Quarterly Financial Data (Unaudited):
166%% of such requirement.
Summarized quarterly financial infom1ation for 1982 and 1981 The 11%% senes of first mortgage bonds due August is as follows(in thousands):
1,2000 is subject to a mandatory cash sinkmg fund require-Fht k ond Third Fourth ment of $5,000,000 annually. In 1981 and 1982, the Company reacquired a total of $5,000,000 of such bonds to satisfy the N""""-
9""""
9"""
N""""
1982, cash sinking fund requirement. The gains on the re-y2rating revenues-acquisitions are mcluded m miscellaneous deferred credits m As rep >ned.
$585,175 $599,521 $698,569 $586,866 the Balance Sheets and are being amortized over the remain-Restated..
576,932 610.071 683.312 586,866 inglifeof theoriginalissue.
Operating income-As reported.
99.608 86,361 130,066 83,390 ASSETS SUBJECT TO LIEN. The Company's mortgage Restated.........
95.505 91.608 122,487 83,390 dated as of March 1,1941, as amended and supplemented, Net inoame after dividends securing the first mortgage bonds issued by the Company,
""{ll'"jk-g a
g 33 cmstitutes a direct first lien on substantially all of the Com-RestatA 81.822 52,829 84,535 39.708 pany's fixed propedy and franchises.
1981 Operating revenues-As rep >rted.
$466.677 M82,5% $578,702 $487.835 Note 7. Nuclear Insurance:
Pro Ibana.
464,808 497.436 566,860 493,584 20 Under the Price Anderson Act,the Company maintainsagree.
Qtgme-70,381 61,887 98,382 76,489 ments ofindemmty with the Nuclear Regulatory Commission Pm Fonna.........
69,450 69,270 92,491 79,349 (NRC) which, together with private insurance, cover third-Netincome afterdividends party liability arising from any nuclear incident occurring at on preferred stock-the Company's nuclear power plant. The Act limits public As repined.
34,500 24.855 58,867 53,872 Pm Fonna.
33,569 32.238 52,976 56,732 liability daims that could arise fmm a single nudear incident to $560,000,000. Each reactor at the Company's nuclear plant Quarterly earnings for the first three quarters of 1982 is insured against this liability to a maximum of $160,000,000 have been restated to give effect to a change in the method by private insurance (the maximum amount presently avail-of recording revenues (see Note 1). The restated amount for able) and the remainder is pmvided by indemnity agreements the first quarter 1982 indudes the cumulative effect of the with the NRC. In the event of a nuclear incident involving any change as of January 1,1982 amounting to $23,009,000 after commercial nuclear facility in the country, a company could taxes. The pro forma amounts for 1981 assume the change be assessed up to $5,000,000 per incident for each licensed had been applied retroactively.
reactor operated by it but not more than $10,000,000 per reactor to be paid in a calendar year. On the bas,is of its owner-Note 9. Supplementary Information Concerning the ship mterest in the two nuclear reactors now in semce, the Company could be assessed a maximum of $5,010,000 for Effects of Changing Prices (Unaudited):
any incident, but not more than $10,020,000 to be paid in any The following supplementary information concerning the 1
one year.
effects of changing prices is presented in accordance with the The Company is a member of Nudear Mutual Limited, general concepts set forth in Financial Accounting Standards
.g a mutual insurer established to provide insurance coverage Board Statement No. 33, as modified to reflect the economic against property damage to members' nudear generating facili.
effects imposed on Georgia Pbwer Company by regulatory ties. The Company is subject to a retrospective premium adjust.
authorities. It should be viewed as an estimate of the approxi-ment in the event that losses exceed accumulated funds. The mate effects of inflation, rather than a precise measure.
i Company's maximum assessment is limited to $28,000,000 Constant dollar amounts represent historical msts stated for each policy year.
in terms of dollars of equal purchasing power, as measured Also, the Company is a member of Nudear Electric Insur-by the Consumer Price Index for All Urban Consumers. Cur-ance Limited, a mutual insurer which provides insurance to rent cost amounts reflect changes in specific prices of plant cover, separately (a) the extra cost incurred in obtaining re-from the date the plant was acquired to the present. They placement power during a pmlonged accidentos outage at a differ from constant dollar amounts to the extent that specific member's nudear generating facility and (b) property damage prices have increased more or less rapidly than the geneml to nuclear generating facilities in excess of $500,000,000.
rate of inflation. The current cost of plant was determined by Members are insured against the increased costs of replace-indexing each major class of plant using the Handy-Whitman
Index of Public Utility Construction Costs. Current cost does Under the ratemaking prescribed by the regulatory com-not necessarily represent the replacement cost of existing pro-missions to which the Company is subject, only the historical ductive capacity because the utility plant is not expected to cost of plant is recoverable in revenues as depreciation and be replaced preciselyin kind.
plant in rate base is limited to original cost. Therefore, the The accumulated provision for depreciatian for current cost of plant stated in terms of constant dollars or current cost was developed by applying for each major class of plant, cost that varies from the historical cost of plant is not presently 4
the same percentage relationship that existed between gross reflected in rates charged to customers. The amount of this plant and the accumulated provision for depreciation on a his-variance in the current year is reflected as an adjustment torical basis to the adjusted plant data. Depreciation expense to net recoverable cost.
for both methods was determined by applying the current Holding assets such as receivables, prepayments, and depreciation. rates to the respective indexed plant amounts inventory results in a loss of purchasing power during periods reduced by the amortization of investment tax credits which of inflation because the amount of cash received in the future were first adjusted to average 1982 constant dollar amounts for these items will purchase less. C(mversely, holding mone-by year of addition.
tary liabilities, primarily long-term debt, results in a gain Increases in the cost of electric generating fuel are recov-because the payment in the future will be made with nominal erable in revenues through operation of fuel cost recovery dollars having less purchasing power. The Company has a mechanisms. Such increases effectively are receivables from net gain due to the significant amounts of long-term debt out-customers. Therefore, such increases are not included in in-standing. While the use of debt financing reduced the effect come, but instead are treated as monetary assets. Income tax of the loss to the common stockholder, earnings were not expense was not adjusted because only historical costs are adequate to offset the emsion in the purchasing power of the deductible for income tax purposes.
stockholdefsinvestment Statement of Income Adjusted for Changing Prices Forthe Year Ended December 31,1982 (In Thousands of Average 1982 Dollars)
Constant Current Dollar Cost Income Applicai$i~e to Common Stockholder, Pro Forma *.
. $235,935 S235,935
~
(
Emsion of Common Stockholdefs Equity Because of Changing Prices:
c Cost in excess of the original cost of productive facilities not recoverable in rates as depreciation-192,944 224,668 Reportable as an additional provision for depreciation......
(3,309)
(63,797)
Reportable as an adjustment to net recoverable cost.
189,635 160,871 Excess of the generallevel of prices ($396,008)in the current 28,764 year over increase in specific price changes ($367,244)"
(127,686)
(127,686)
Offsetting effect of debt financing.
61.949 61,949 Net erosion of common stockholdefs equity.
income Applicable to Common Stockholder, as Adjusted"*
(including the effect of debt financing)
$173,986 S173,986
- Pro Ibrrna excludes the cumulative effect as of January 1,1982 ($23,009,000 after taxes) of a change in the method of recording revenues (See Note 1).
"At December 31,1982, current cost of pmperty, plant and equipment, net of accumulated depreciation, was $11 billion and historical c>st or net cost recoverable through depreciation was $6 billion.
"* Adjusted income applicable to common stockholder would be $43 million on a constant dollar basis and $11 million on a current cost basis if only the amount reportable as an additional provision for depreciation was deducted from the reported amount of such income.
l Five-Year Comparison of Selected Supplementary Financial Data Adjusted for Effects of Changing Prices *
(In Thousands of Dollars) 1982 1981 1980 1979 197_8 Operating Revenues:
Pro Forma historical cost".
S2,457,201 S2,022,688 S1,811,154
- >1,510,259 S1,477,567 As adjusted........
S2,457,201 S2,144,049 S2,119,050
$2,008,644 S2,186,799 Income (Loss) Applicable to Common Stockholder:
Pro Forma historical cost **
S 235,935 S 175,515
$ 196,709 S 140,706 As adjusted for the net erosion of common stockholder's equity.
173,986 68,246 67,061 (5,950)
Common Stockholde/sInvestment (Net Assets), at Year end:
Pro Forma historical cost".
$1,751,186
$1,481,249 S1,333,903 S1,229,091 S1,196,066 As adjusted....
1,733,674 1,525,686 1,493,971 1,548,655 1,698,414 Excessof theGeneralLevelof Pnces OverIncreasein Specific Price Changes.
S 28,764 S 30,954 S 196,779 S 378,463 Effectof Debt Financing.
S 127,686 S 248,457 8 363,876 S 416,878 Return on Average Common Equity:
Pro Fonna historical" 14.60 %
12.47%
15.35 %
11.60%
As adjusted for the net erosion of common stockholdefs equity.
10.68 %
4.52%
4.41%
(.37%)
Cash Dividends Declared:
llistorial cost..
$ 154,700 S 131,000 S 136,400
$ 131,100 S 119,225 As adjusted.
154,700 138,860 159,588 174,363 176,453 23 Average Consumer Price Index.
289.1 272.4 246.8 217.4 195.4
' Adjusted amounts represent average 1982 dollars.
" Pro Forma historical cost for 1982 excludes the cumulative effect as of January 1.1982 ($23,009,000 after taxes) of a change in the method of recording revenues (See Note 1 L Pro forma histoncal cost for years prior to 1982 assumes the change had been applied retroactively.
l Auditors' Report To the Board of Directors of In our opinion, the financial statements referred to above Georgia Power Company:
present fairly the financial position of Georgia Power Company as of December 31,1982 and 1981, and the results of its opera-tions and the sources of funds for gross property additions for We have examined the balance sheets and statements of cap-the periods stated,in conformity with generally accepted ac-i italization of Georgia Power Company (a Georgia corporation counting principles, which, except for the change, with which and a wholly owned subsidiary of The Southem Company) as we concur, in the method of recording revenues as described of December 31,1982 and 1981,and the related statements of in Note 1, were applied on a consistent basis.
income, earnings retained in the business,6ther paid in capital and sources of funds for gross property additions for each of the three years in the period ended December 31,1982. Our ART 11UR ANDERSEN & CO.
examinations were made in accordance with generally accepted auditing standards and, accordingly, included such tests of the accounting records and such other auditing pmcedures as we Atlanta, Georgia.
musidered necessary in the circumstances.
Februay 11,1983.
l Report of Management l
The management of Georgia Power Company has prepared for fair financial reporting.They regularly review the system and is responsible for the financial statements and related of intemal accounting contml and perform such tests and other l
l information included in this report, These statements were procedures they deem necessary to reach and express an prepared in accordance with generally accepted accounting opinion on the faimess of the financial statements.
i principles appropriate in the circumstances, and necessarily The Audit Committee of the Board of Directors. composed include amounts that are based on the best estimates and of three directors who are not employees, provides a broad l
judgements of management. Financial information throughout overview of management's financial reporting and control func-this annual report is consistent with the financial statements.
tions. Ibriodically this committee meets with management,the l
The Company maintains a system of internal accounting intemal auditors, and the independent public accountants to cmtrol to provide reasonable assurance that assets are safe-ensure that these groups are fulfilling their obligations and to guarded and that books and records reflect only authorized discuss auditing, intemal control, and financial reporting mat-transactions of the Company. Limitations exist in any system ters.The internal auditors and independent public accountants of internal control based upon the recognition that the cost of have access to the members of the Audit Committee at any time.
the system should not exceed its benefits. The Company Management believes that its policies and procedures i
believes its system of intemal accounting control, together provide reasonable assurance that the Company's operations l
with its internal auditing function, maintains an appropriate are conducted with a high standard of business ethics. In man-I cost / benefit relationship.
agement's opinion, the financial statements present fairly the l
The independent public accountants provide an objective financial position, results of operations, and sources of funds assessment of how well management meets its responsibility for gross property additions of Georgia Power Company.
t i
l Board of Directors
~i WALTER G. AUTREY L. G. HARDM AN, III President President and Treasurer l
Hamilton Turpentine Co.,Inc.
Harmony Gmve Mills,Inc.
q (naval stores) Valdosta,1972 (textiles) Commerce,1979
)
H.GRADY BAKER,JR.
WARREN Y.JOBE 27 Executive Vice President-Executive Vice President-
,a
~
3' Marketing and Customer Service Finance t ;*
Left to right i
Georgia lhwer Company Georgia Power Company i
g, p 1
l Atlanta,1980 Atlanta,1989
//
i BENNETT A. BROWN A
ected 8N82)
Chairman and Chief Executive Officer RICHARD J. KELLY gA l A Gantt i
The Citizens & Southern National Bank Executive Vice President-l tbanking) Atlanta,1980 lbwer Supply w
Georgia Power Canpany
.~
N. N. BURNES, J R.
Atlanta,1981 Vice Chairman Rome Manufacturing Company HAROLD C. McKENZIE,JR.
y l
(textiles) Rome,1965 President j
(retired 6/2/82)
Southern Electric International,Inc.
M Atlanta,1972
?
{
GEORGE W. EL) WARDS,JR.
Executive Vice President-JAMES H. MILLER,JR.
External Affairs President Left to right l
Georgia Power Company Georgia ihwer Company L S. Floum l
Atlanta,1982 Atlanta,1975 l
(ekcted 5/18/82)
WILLIAM S. MORRIS,III it: A. Parker,Jr l
WILLIAM A.FICKLING,JR.
Chairman and Chief Executive Officer Chairman of the Board and Morris Communications Corporation I
Chief Executive Officer (publishing) Augusta,1%7
" ^ ^
Charter Medical Corporation WILLIAM A. PARKER,JR.
?
(medical facilities) Macon,1973 Chairman of the Board X'T
LANGDON S. FLOWERS Cherokee Investment Company Chairman of the Board (real estate and investments >
Flowers Industnes,Inc.
Atlarta,1965
{,
(baking) Thomasville,1982 IL G. PATTILLO 3-l tehoed 7/21/82)
Chairman GP Left to right J. A.GANTT 15ttillo Construction Company, Inc.
gO E CM"#'O Senior Vice President (construction) Decatur,1972 H: B. 71nwr l
Georgia Power Company 3
Atlanta,1976 W A. Fickling.Jr.
{
ROBERT W. SCllERER F
Board Committees Chairman of the Ibard and Chief Executive Officer q
a EXECU'IIVE CONIAllTTEE (e
1( rCompany
~*
R M \\V. h - @ i m l
1 James 11. h1 iller,Jr.
1 DR. GLORIA St.SIIATTO N
liarold C. NicKenzie,Jr.
President l
William A.Ituker,Jr.
Herry College and Berry Academy II.G.-Pattillo (education) Rome,1980 Robert Strickland Left to right EDWARD D. S.\\llTil f, n. yill#7 /*
AUDIT CON 1111TTEF-llansell, Post, Brandon & Dorsey y,g,pyfjgg (attorneys) Atlanta,1960 William A.Fickling,Jr., Chairman (retired 3/9/82)
T R. II'illian:s L.G. liardman,III Gloria 51. Shatto ROBERT STRICKLAND gn e
CON 1PENSATION C011511TTEE m ny of erargia D
II.G. I*attillo, Chairman (banking) Atlanta,1979 g,
a
[
William A. Parker,Jr.
WILLIAh! B. TURNER i
Vice Chairman of the Ibard and Wilham itTumer Chief Executive Officer
- 4
~
W.C. Ilmdley Company l
k
' Left to right (industrialists) Columbus,1965
=
ff,j, ycfgmfr,j ALVIN W. VOGTLE,JR.
[
Dr G. M. Shatto Honorary Directors President The Southern Company l
%)
- .F Joe IL Browder Atlanta,1968
~
U Sl'ickland Atlanta,1976 CARL WARE J P Vice President W. E. Ehrensperger 28 CoCola, U.S. A.
Atlanta 1981 (soft dnnk company)
Atlanta,1980 Edwin i. llatch f"[h "Ee "
TilONIAS R. WILLIAh1S Chairman of the Board d
Atlanta,1978 First Atlanta Corporation and its major subsidiary Allen B. Wilson The First National Bank of Atlanta Left to right Atlanta,1974 i
(banking) Atlanta,1982 L. G. Hardman, /// (elected 8/1/82)
(elected 3/17/82)
C. II' re J
a ALLEN lt WILSON H.G.BakccJr l
SeniorExecutiveVicePresident-Finance L
General Officers i
Georgia Power Company
- ' ~
l Atlanta,1974 hetired 7/31/82)
ROBERT W. SCilERER Chairman of the Board and f
Chief Executive Officer I
ry s Age: 57 Years of Senice:36 Left to right JAN1ES il. hllLLER,JR.
A. B. II'ilson President ky Senice:36 E. I. Hatch
^.-
II:E. Ehrensperger II.GRADY BAKER,JR.
l Not pictured Executive Vice President-B. A. Brmen N1 rketing and Customer Service Age: 53 l U N'mcdcr Years of Service: 32 l
GEORGE W. EDWARDS,JR.
II: S. Moms,Ill Executive Vice President-E. D. Smith External Affairs Age: 43 I
Years of Service: 13
]
l WARREN Y.JOBE lhecutive Vice President-Finance
)
Age: 12 Years of Se rvice: 12 et,
'8 (elected 5 '19/82>
a
~'
5 m
RICilARD J. KELLY h
7-
/,
l Executive Vice President-Pmver Supply 1
i Age:60 g
Years of Service: 33 si!
j j
R. E. CONWAY n-I Senior Vice President
.i Pmver Supply and Engineering Services. Generating Plant l
Con.tructinn and Projnt N
hlanagement Age: 11 t
Years of Service: 26 l
l A.W DAllLBERG S,5,, yg.e Presidents scatedfnim i<ft: R. P. Ilcad,Jr.. R. E Gnnray. G. F. llcad: standing:
G. T lhnion, R. E Scott. IV. L IVcstbrwk, A. IV. Daldberg.
t l'
s Age: 12 THONIAS G. HOREN C. B. AlcA1 ANUS,JR.
CilARLES 0. RAWLINS Years of Service: 23 Vice President Vice President Assistant Treasurer klected 5 /19 '821 Corporate Ibrfonnance Power Delivery GUERRY P. STRICKLAND I
J. A.GANTT JANIES 11. BOYKIN F. G. N11TCllELL,JR.
Assistant Secretary Senior Vice President Vice President and Vice President ROBERT C' FORD j
Division Operations Chief Engineer Generating Plant Construction A" "I "I. Mary and Age: 60 telected 1/1/82>
Technology and Assistant to Assistant,freasurer
(
Years of Sen ice: 35 Senior Vice President l
JACK C.C,AL,SEN E. RAY PERRY 29 I
GEORGE F. HEAD Vice President J. A. PARRAN! ORE.JR.
Assistant S.ecretary and Senior Vice President Fossil and livdro Vice President Assistant Treasurer Power Generation teleded 9 /15 '82>
Customer Accounting and Accounting Services 0#" ' f Service: 28 WAYNE T. DAHLKE s lected 6 16 r 82)
Tears o e
Vi P idmt ud R. P. IlEA D. J R.
General Nianager, Scherer Project R. H. PINSON Senior Vice President teleded 9 /15182)
Vice President Admini.trative Services Generating Plant Construction Division Officers ARe: aa JA51ES K. DAVIS JOHN A. ROBERTS Tears of Service:.G Vice President Vice President N.E' President
"'N GERALD T. HORTON Corporate Relations Retail.\\larketing N ice Senior Vice President (elected 12/15/82)
Public Affairs 3;..TA p. R Mwns Dmon
\\ ce President l
Age: 18 D. E. DUTTON E. A. Y.YTES.JR.
l Years of Servicc:3 Vice President Area Deselopment Vice President telected 5 /19!82)
Generating Plant Projects-ALVIN W. VOGTLE, JR.
Atlanta Division f>ogtle, Scherer and Ilydroelectric Vice President It W. RAINWATER RONINEY E. SCOTT Senior Vice President JACK K. WIDENER JR.
Vice President Vice President Augusta Division Economic Senices DONALDO. FOSTER SK": 39 Vice President and Regulatory and Consumer Affairs ANDREW IL SPEED r
Tears of Service:6 General Nianager, Vogtle Project CHARLES R..\\lINORS Vice President telected 5 '19 '82' j
telected 9/15'826 Assistant Vice President Columbus Division W. L. WESTBROOK Consumer Affairs JOHN C. IIEN1BY,JR.
l Semor \\ ice President L, L, 3,0NE5, C. It HARRELD Vice President i
Accountmg :md Finance
\\, ice I resident m
Dsn and Secret iry I,rocurement and.\\latenals (elected 7/ 6'82) telected 9 /1/821 i
Tge: -13 Years of Senice: 19 3 WIAN LAllB RICilARD J. PERSHING T.J. ALLEN,JR.
Vice President Treasurer Vice President I
(elected 8 '18 '82, i
Risk.\\lanagement telected 8 /18/82)
Rome Division s
J. T. BEChil ANI.J R.
Vice President and WADE S..\\l ANNING W lt POSS J.J. CORDOVA General Nianager-Vice President Assistant Comptroller Vice President Nuclear Generation Land Accounting Services Valdosta Division 1
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Geor;is'a Electric Cyctem Generating Units Under Construction at December 31,1982 Nameplate Commercial Fossil Rating (kilowatts)
Operation Date Plant Scherer Unit No.2.
68.712(1) 1984 Plant Scherer Unit No.3.
818,000 1987 Plant Scherer Unit No.4.
818.000 1989 Nuclear Alvin W. Vogtle Nuclear Plant Unit No. l.
588.120(1) 1987 Alvin W. Vogtle Nuclear Plant Unit No.2..
588.120(1) 1988 Ilydro Bartletts Ferry Unit Nos.5 and 6.
108.000 1985 Goat Rock Unit Nos.7 and 8.
67,000 1988 Pumped Storage Rocky Motmtain Unit Nos.1,2 and 3.
847.800 1987 (1) Canpany portion ordy. excluding amount sold tojoint participants.
Jointly Owned Plants at December 31,198.
Plant..
Ilatch Wansley Wansley Scherer Vogtle (Nuclear)
(Fossil)_
(GasTurbine)
(Fossil)
(Nuclear)
Units.,
1&2 1&2 SA 1&2 1&2 Megauntt Capacity.
1,630 1,730 49 1,636 2,320
"/o Owned Georgia Power.
50.1 53.5 53.5 8.4 50.7 OPC....
30.0 30.0 30.0 60.0 30.0 MEAG.
17.7 15.1 15.1 30.2 17.7 Dalton.
2.2 1.4 1.4 1.4 1.6 g
Nameplate Generating Capacity (1)
(Year-end 1982)
Kilowatts Steam Fossil (2)..
8.918.962 Nuclear.
816,630 GasTurbines (2).
..... 1,207,822 Ilydro.
_ 754.480 Total Capacity.
. 11.697,894 (1) Canpany portion only, excluding amount sold tojoint participants.
(2) Excludes 5(k),(MW) kre offossiland!).810 kre ofcombustion turbines at Southem Electric Generating Co. (SEGC01
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To our investors In an attempt to improve investor understanding of our oper-ations and the flow of funds within our Company, we have reformatted our Statements of Income and Sources of Funds for Gross Property Additions. The attached statements differ from the traditional electric utility format, and we believe that they may be more meaningful to investors familiar with other businesses.
Any comments or suggestions conceming these presenta-tions would be appreciated.
Please enter any comments you have on the reformatted Statements of Income and Statements of Sources and Uses of Funds:
O 1 would like to receive a copy of the Company's 1982 fomi 10K O 1 would like to receive a copy of the Company's 1982 Financial and Statistical Review O 1 would like to have my name included on the Company's financial mailing list.
Name_
Address
No !btage nitessary if mailed in the l
l'nited States i
IlUSINESS REl'lX CARD l
FIRST Cl. ASS Ihmiit No.631 Atlanta, GA 1
Mr. W. l.. Westbrook Senior Vice l' resident Accounting and Finance and Secretary Georgia l'ower Company l'ost Ollice llox.1515 Atlanta,GA 30302
Statements of Income in thousands Georgia Power Company Years Ended December 31 1982 1981 1980 Operating Revenues Retail..
S2,001,259
$1,663,798
$1,530,334 Wholesale-Territorial, 281,206 251,572 205,030 Wholesale-Non-Territorial.
I17,565 82,048 56.911
- Other, 21,171 18,3_92
_ l_6,133 2,157,201 2,015,810 1,808.408 Other income Allowance for equity funds used during construction.
70,593 48,690 35,663 Gain on sale of facilities.
6,939 29,282 Interest and Other income.
12,983 48,620
_ 29,59_9 120,515 97,310
_ 94,544
._ 902,952 Total Income.
2,577,716 2,113,120 1,
Expenses Operation-Fuel.
828,310 811,088 716,566 Purchased and interchanged power, net,
305,137 73,566 4,324
- Othcr, 313,817 280,354 222,155 51aintenance.
171,606 161,351 144,344 Depreciation and ammtization.
162,796 157,336 153,245 Taxes other than income taxes.
93,271 83,780 73,454 Net interest charges (a).
206,195 170,901 157,693
'Ibtal Expenses.
2,081,762
__1,738,3_76 1,4_7_l,781 Income llefore Income Taxes,
192.951 374,744 431,171 IncomeTaxes Cun ent.
1,031 15,329 80,436 Deferred.
129,331 91,080 79,343 Investment Tax Credit.
78,183 55,875
._ 40,82_3 TotalIncome Taxes.
208,551
__ 162,2_84 2_00,602 Income Hefore Change in Slethod of Recording Revenues.
281,103 212,460 230,569 Cumulative effect as of January 1,1982 of accruing unbilled revenues,less income taxes of $22,320,000.
23,009 Net income.
307,11' 912,460 230,569 Preferred Dividends,
18,16S 40,366
__35,224 Net Income After Preferred Dividends.
S 258,911 S 172,094 S 195,345 (a) Net Interest Charges:
Interest on long-term debt.
S 267,863 S 213.278
$ 186,210 Amortization of debt discount, premium and expense, net.
1,256 929 805 Other interest charges.
2,185 3,162 10,741 Allowance for debt fur ds used during construction.
(65,109)
(46,468)
(40,063)
S 206,195 S 170,901 S 157,69_3 The Notes to Fina >;eialStatenients in the Annual Repnt shoidd be rrad in anijwietion ucith these statements.
Statements of Sources and Uses of Funds in thousands Georgia Power Company Years Ended December 31 1982 1981 1980 Sources of Funds:
Funds from operations:
Net Income.
S 307,112 S 212,460
$ 230,569 Add (deauct) noncash items Depreciation and amortization.
191,391 183,833 185,206 Deferred income taxes, net.
129,331 91,080 79,343 Deferred investment tax credits.
78,183 55,875 40.823 Allowance for equity funds used during construction.
(70,593)
(48,690)
(35,663) 635,730 494,558 500,278 Less-Dividends on common stock.
151,700 131.000 136,400 Dividends on preferred stock.
l8,.168 40,366 35,224 Funds from operations.
132,562 323,192 328,654 Funds from financing and sales of assets First mortgage bonds.
250,000 300,000 75,000 Preferred stock.
75,000 Preferred stock subject to mandatory redemption.
75,000 Cash contributions by parent company.
191,000 103,000 44,000 Pollution control obligations.
96,191 67,584 40,673 Increase in otherlong-term debt.
-1,082 3,166 68,682 387,021 Sales of facilities, net book value.
19.562 Funds from financing and sale of assets.
635,838 548,750 615,376 Other, net (including allowance for equity funds used during construction).
(2,509)
(15,392)
(5,518)
Total Sources of Funds.
S1,065.891 S 856,550
$ 938,512 Uses of Funds:
Bonds and preferred stock retired, refunded or reacquired.
5 20,696 S 31,371 S 24,695 Changes in net current assets, excluding long-term debt and preferred stock due within one year..
133,050 94,725 222,858 Gross property additions (includes allowance for funds used during construction in the amount of $103,642,000 in 1982, S72,277,000 in 1981, and $55,776,000 in 1980).
912,115 730,454 690,959 Total Uses of Funds.
S1,065,891 S 85_6,550
$ 938,512 The Notes to Financial Statements in the A nnual Report shordd be read in conjunction icith these statements.
Georgia Power Company P.O. Box 4545 Bulk Rate Atlanta, Georgia 30302 U.S. Postage PAID 3
Atlanta, Georgia Ibrmit No. 8 I
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