Ladies and gentlemen, please welcome Tom Fanning.
What a fabulous day this is. I see now we have standing room only for our annual meeting. I think so many people were excited to elect a new CEO. Anyway, it's so great having you folks here, and I, it's so fun as I circulated before the meeting, so many people have been here for so many years, and we always appreciate your attendance and your loyalty to this great company. I'll say, we have a retired director here with us, Juanita Baranco. Juanita, please stand. I always said that when the bullets start flying, I wanna get back-to-back with that one. She's tough as a $2 steak, let me tell you. Anyway, it's great being here, and these are always so much fun. This is a unique experience.
I'm gonna be your CEO now for another 15 minutes. Chris Womack is gonna do such a great job, and I'm so excited to have this day come to bear. All right, officially, let me welcome you to the opening of our 2023 annual meeting. The folks that do the videos, the folks that set up the room, the folks that make sure that we have breakfast and lunch afterwards, I wanna thank them. Please give them a round of applause. This stuff doesn't happen. Without a lot of help. The cool thing that you just saw in the video is that the folks that were in that video are not actors. Those are actual Southern Company employees. You know, they are here with us today, and I just wanna call them out real quick.
If you would just stand as I call your name. Nisha Patel. Nisha, where are you? There you are. She's the Environmental Affairs Lab Analyst for Georgia Power. Thank you, Nisha. Lauren Latham, Principal Engineer in Research and Development at Southern Company Services. I know I say this all the time, but Southern Company is the only company in our industry that does robust proprietary research and development. Our role is not to take what comes, but to invent the future. You guys do a great job. Benny Ratnagaran, Risk Engineer for Southern Nuclear. You guys in Southern Nuclear are killing it. Great job. Chris, I'm only gonna steal some of your thunder right now, we're at 90% power today at Vogtle 3, and within a week, we will be at 100% power. Isn't that a wonderful conclusion along the road?
You folks at Southern Nuclear not only have done a great job on Vogtle 3 & 4, but you run a wonderful fleet, and we were recognized recently as one of the top nuclear fleets in America. Cody Sloan, Distribution Line Crew Leader for Georgia Power. Those of you from the Atlanta area, be extra nice to him. He'll keep your lights on, I guarantee you. Then Jason Waters, Workforce Development Coordinator for Alabama Power. Thank you. I can tell you, it's so important, that kind of role. I'm always impressed when I talk to the folks that have been here for so many years, and you get a chance to mingle and see the folks that are gonna carry this company forward for decades after I'm gone.
We're so proud of the work you do and the work that the folks do that come here, and really drive this company forward. The other thing is, along that line, we have with us this morning another big group of people, I don't know, 25 or so, of distinguished employees who have been selected to be here as part of their professional development. They represent just a small sampling of our up-and-coming leaders, of tomorrow. If you guys would please stand. Look at that. You guys are terrific. I can tell you, we always have this saying that Southern Company is, I think, remarkable in that we have thousands of good people that make thousands of good decisions every day for the benefit of the customers we're privileged to serve.
Those are the kind of folks who are gonna continue to drive this company forward, and we're so appreciative. We did a little bit of a rehearsal just to make sure that today goes seamlessly, and at the end of it, we spent about, I don't know, a couple hours together, me and then some other folks, just talking in a very candid way about the vision of this company and how it's gonna move forward. We talked not about the whats, the making, moving, and selling of energy, but also the hows, and I think the culture, the behaviors, how we treat each other, how we work with customers, how we work with our external publics, how we assure ourselves that this company will remain committed to the idea that the communities must be better off because we're here.
The idea is we wanna be citizens wherever we serve. They're gonna carry that ideal forward. I'm so proud of them. Okay, now, as is our custom, this annual meeting is held right around Memorial Day. What I'd like to do is recognize all the military veterans and active military to stand and be recognized. If you've been in the military. Thank you. I know Chris Womack is gonna take you through some of the accolades, but one of the accolades this company consistently gets is we're one of the very top employers of veterans in this country, and we get recognized for it every day. They do a great job for us outside Southern, and when they're inside Southern, they understand teamwork and commitment and selflessness.
We thank you for your service. Okay, before we dive into official business, the man of the hour, Chris Womack, great friend of mine, was unanimously selected by our board to be the next CEO of Southern Company. At the conclusion of the business portion of the meeting, Chris will be the CEO. Chris, please stand and let our shareholders recognize you. Chris will share some thoughts about 2022 accomplishments in just a short while. After that, we're changing it up just a little bit in this annual meeting to honor the transition. We'll have a wee bit of a fireside chat. I don't know what we're gonna do, but Chris and I don't follow agendas worth a darn. We'll have a chat together, and then we will jointly address your questions- and- answers.
Sloane Drake, our Executive Vice President, Chief Human Resources Officer, will now deliver our safety briefing.
Good morning. If there's an emergency, we will dial 911 from a house or a cellphone. EMTs are on standby outside the ballroom. In the event that we need to evacuate the building, we will exit this meeting room, congregate at the front entrance of the hotel, and hotel and security personnel will direct us to the designated area in the parking lot. There are two fire extinguishers and an AED located in the pre-function area outside this meeting room. Please raise your hand if you were trained in CPR. Great. Tom, back to you.
Thank you so much. Something else we wanna begin this year, we do this regularly at our management council meetings and officer forums, and a variety of other things. We've always tried to recognize the concept of the whats that we do, make, move, and sell, and the hows, and I just kinda referenced that a second ago. It's been a passion of mine my entire career to understand the notion that we've got to allow people to bring their best selves to work. We want to assure ourselves that we pay attention to the concept of Moving to Equity for all people, race, gender, sexual orientation, religion, age, country of national origin, all of the wonderful differences that make us individuals that can work together for a common purpose. We've put in place a Moving to Equity initiative.
What we do is we're gonna take a moment before we begin any job or gathering or meeting at Southern Company as part of our day-to-day culture. We thought it would be appropriate to show you that same kind of concept. What I'm gonna ask right now is Jim Kerr, formerly Chief Counsel and now CEO, President of our Gas business, to give us a moment on Moving to Equity.
Thanks, Tom, and good morning. So many of us, you might have noticed today are wearing green ribbons. May is Mental Health Awareness Month, we're wearing green ribbons in support of that concept. As I've traveled across the Southern Company Gas footprint this last month, the month of May, I've participated in a number of these Moving to Equity moments where the topic has been mental health. The challenges we face in maintaining good mental health, sometimes the awareness of the resources that we have available to us, and it's and most importantly, probably breaking down the stigma to really engage in the conversation amongst your peers and realize that it's okay to to raise your hand if you or someone you know needs help, and to check on your neighbor.
We talk about see something, say something as a matter of, as a function of physical safety out in the workplace. We've adopted that concept at gas this month as we talk about mental health. If you see somebody who needs help, say something, check on them. With that, what I'd like to ask all of you all to do is to think about May as Mental Health Awareness Month. Please prioritize caring for your own mental health. Please be aware that many who we encounter every day are struggling. Please educate yourself about the many resources that are available within our company as well as within our communities. Please reach out if you or someone you know needs help. Tom, that's our Moving to Equity moment. Thank you.
Outstanding, Jim. Thank you very much. Now we're gonna start getting official, folks. Here we go. Please note that this meeting will be conducted as set forth in the order of business in accordance with the rules of conduct posted at the check-in desk that you passed by this morning, and made available to each of you at your seats. I would ask that the members of our management team who are here with us today, the officers of Southern Company and the officers of our subsidiary companies, please stand and let our shareholders recognize you. Please stand, folks. Awesome. That is a wonderful team of folks. The order of the meeting will be as follows.
We will conduct the formal business portion of the meeting in which we will introduce the director nominees, present the items being voted on today, including allowing the persons that are here today at the meeting to present their shareholder proposals, distribute ballots for those that have not yet voted or want to change their votes, and provide preliminary voting results. Chris Womack and I, as I said, will provide a CEO update and talk about the leadership transition. We will conclude, as always, with our wonderful question- and- answer period. We'll have lunch together at the end of the business portion of the meeting. We're webcasting our meeting live on the Internet. You will also be able to find a replay of this meeting on our website.
We respectfully request that no cameras, sound, or video recording equipment be used during the meetings. In accordance with our rules of conduct. Now we will move to the formal business portion of the meeting. This meeting is called to order, and the polls are open. Deloitte & Touche has been appointed by the Audit Committee as the company's independent registered public accounting firm for 2023. Tim Gillum, my great friend of Deloitte & Touche, is present at today's meeting. Mr. Gillum, please stand, and if you'd like to make a statement, you may now take the opportunity to do so. No comments. Fantastic. Thank you, Tim. The board has appointed Broadridge Financial Solutions to serve as the independent inspector of the elections for today's meeting. Debra Baker, on behalf of Broadridge, is participating in today's meeting as the independent inspector.
Ms. Baker, please stand. Where are you? Oh, there you go. Thank you for being here. Anything you wanna say? You good?
I'm good.
All right. Take care of that leg of yours. Holy smokes. Myra Bierria, corporate secretary of the company, has confirmed that approximately 924 million shares, representing about 84% of the issued and outstanding common stock as of March 27, the record date for this meeting, are represented in person or by proxy at the meeting. We have a quorum necessary to conduct business. There's eight items that we're voting on today. The first item is the election of 16 directors. I will now present those individuals who, along with me, have been nominated for election to the Southern Company Board of Directors. They are a great team. As I call your name, folks, please stand, face the audience, and remain standing until everybody has been introduced. Janaki Akella, former Digital Transformation Leader of Google. Hal Clark, retired Senior Advisor of Evercore.
Tony Earley, retired Chairman, President and Chief Executive Officer of PG&E Corporation. David Grain, Chief Executive Officer and Managing Director of Grain Management, and David is our Lead Independent Director. Colette Honorable, Partner at Reed Smith and former Commissioner of the Federal Energy Regulatory Commission. Don James, retired Chairman of the Board and Chief Executive Officer of Vulcan Materials Company. Johnny Johns, Senior Advisor at Blackstone Inc., and former Chairman and Chief Executive Officer of Protective Life Corporation. Dale Klein, Associate Vice Chancellor of Research at University of Texas System and former Commissioner and Chairman of the United States Nuclear Regulatory Commission. Dave Meador, retired Vice Chairman and Chief Administrative Officer, DTE Energy. Ernie Moniz, Cecil and Ida Green Professor of Physics and Engineering Systems, Emeritus, Special Advisor to the MIT President and former United States Secretary of Energy.
Bill Smith, Chairman of the Board, President and Chief Executive Officer of Capital City Bank Group. Kristine Svinicki, Adjunct Professor at the University of Michigan and former Commissioner and Chairman of the United States Nuclear Regulatory Commission. Lizanne Thomas, Of Counsel, Jones Day. Chris Womack, President of The Southern Company, and upon conclusion of today's meeting, the Chief Executive Officer of Southern Company. Jenner Wood, retired Corporate Executive Vice President, Wholesale Banking of SunTrust Banks. These individuals and I have been nominated for election to the Board of Directors. Please give them a round of applause, and we'll let them sit down. Thank you, folks. I can't imagine a better team to work with, and thank you for all of your teamwork over the past 13 years or so. The second item is an advisory vote on the executive officer compensation.
It's often called a say on pay vote. The third item is an advisory vote to approve the frequency of the votes on executive compensation, and that's referred to often as a say on frequency vote. The fourth item is the ratification of the appointment of Deloitte & Touche LLP as the company's independent registered public accounting firm for 2023. The fifth item is an amendment to the restated certificate of incorporation to reduce the super majority vote requirement to a majority vote. The sixth, seventh, and eighth items are shareholder proposals. For Item 6, the stockholder proposal regarding simple majority vote, Kaylea Noce is here today on behalf of Mr. John Chevedden to present the proposal. Kaylea, you have three minutes to present the proposal. There you go. Welcome.
Thank you. Can you hear me?
Yeah.
Good morning. My name is Kaylea Noce. I am presenting shareholder Proposal 6, sponsored by John Chevedden. Shareholders request that our board take the necessary steps so that each voting requirement in our charter and bylaws that calls for a greater than simple majority vote be replaced by a requirement for a majority of the votes cast for and against such proposals or a simple majority. It is not necessary to stress the importance of Proposal 6, because the topic of Proposal 6 was approved by 98% of the Southern Company shareholders who voted in 2021. However, the topic of this proposal required the approval of 67% of all the Southern Company shares outstanding, including the Southern Company shares that never vote.
The problem is that not enough Southern Company shareholders vote, and Mr. Anthony Earley, who chairs the Southern Company Corporate Governance Committee, believes in pinching pennies regarding any effort to encourage more Southern Company shareholders to vote. Shareholders are willing to pay a premium for shares of companies that have excellent corporate governance. Super majority voting requirements, which this proposal will remove, have been found to be one of six entrenching mechanisms that are negatively related to company performance, according to What Matters in Corporate Governance by Lucian Bebchuk of the Harvard Law School. Due to the high market capitalization of the Southern Company, even a fraction of a 1% increase in the capitalization of the Southern Company means a $250 million increase. The topic of this proposal has the potential to increase the market capitalization of the Southern Company by $250 million.
If the Southern Company spent $1 million to make sure more Southern Company shareholders voted in order to adopt Proposal 6 as a Board of Directors proposal, the Southern Company Board of Directors would be getting a $250 return for every $1 invested. A $250 return for every $1 invested is an incredible opportunity for Mr. Anthony Earley, who chairs the Southern Company Corporate Governance Committee. A simple majority vote standard will facilitate the adoption of further improvements in the corporate governance of the Southern Company. The principle of a simple majority vote standard is a win for shareholders, the board, and management. Please vote yes on Proposal 6.
Thank you, Ms. Noce. We really appreciate that. After careful consideration, the board has recommended a vote against the proposal. You can read the board's statement and response beginning on page 111 of the proxy statement. For Item 7, the stockholder proposal regarding setting Scope 3 GHG targets. Ms. Noce will also present the proposal on behalf of As You Sow. Kaylea, you have the floor.
Thank you. Again, my name is Kaylea Noce, a shareholder representative from As You Sow. Thank you for the opportunity to present Proposal number 7 on the Southern proxy. This proposal asks Southern to set short and long-term Paris-aligned targets across its full range of value chain emissions. Investors are concerned that failure to fully account for material Scope 3 emissions in net zero target setting and planning will lead to ill-informed strategic investment decisions that can lock in large sources of emissions for decades to come, limit the company's progress on reducing emissions rapidly and cost effectively, and exacerbate company-level climate transition risk. Energy utilities that generate power and distribute natural gas have a critical role to play in achieving the Paris Agreement's goal of limiting global temperature rise to 1.5 degrees Celsius.
Net zero targets that address only Scope 1 emissions from generating electricity and other direct operations miss a significant portion of utilities' climate impact. Currently, Southern excludes downstream emissions from the sale of natural gas to 4.4 million customers from its net zero target. Furthermore, Southern also does not include the upstream emissions from the production of coal and natural gas that it procures or the power it purchases from the grid. Together, these three material sources of emissions account for approximately 30% of Southern's total emissions and represent a major source of exposure to disruptive climate risk.
The lack of inclusion of these material Scope 3 emissions means Southern fails to align with key climate benchmarks, including the Climate Action 100+ net zero benchmark, endorsed by 700 investors representing $68 trillion in assets, and the Science Based Targets initiative, widely considered a global gold standard in corporate climate target validation. Southern also lags peers on target setting for these emissions. Duke, Dominion, Sempra, Xcel, and CMS have all announced the expansion of their net zero emission reduction targets to include the sale of natural gas to customers from their gas distribution businesses. These demonstrate the U.S. energy utility industry's acceleration to better account for its climate impact and risk and to incorporate them into clean transition strategies. Southern must follow suit.
We look forward to working with Southern Company to address this vital issue. We ask for your support in voting yes for Proposal 7. Thank you.
Kaylea, thank you so much. As You Sow has been a great friend of this company over the years. Thank you very much. After careful consideration, the Board has recommended a vote against this proposal. You can read our statement in response beginning on page 113 of the proxy statement. For Item 8, the stockholder proposal regarding issuing an annual report on the feasibility of reaching net zero. Mr. Steven Milloy is here today to present the proposal. Is Steven here? Okay, he's not here. For Item 8, therefore, if neither Mr. Milloy nor an authorized representative representing him is here to present this proposal as required by SEC rules, as a result, this proposal will not be considered at this meeting. You need to be here or have a person, a representative. Since they're not here, we will not consider that proposal.
Now we'll take questions specific to the items up for vote. Are there any questions? Laura, where are you? Where's Laura? There you go. Are there any questions?
No questions for this session, just general Q&A.
Got it. Okay. Now we'll proceed with the balloting. If you've already voted, there is nothing else you need to do at this time. If you have not voted or if you wanna change your vote, please raise your hand and a representative will provide you with a ballot. Please raise your hand if you wanna take advantage. I got one here, back there. Anyone over there? No. We'll just take a pause for a sec.
When you have three of your votes-
Please raise your hand, and we'll take them up, and then we will move on to the rest of the meeting. How are we doing? There we go. We good back there? We're good? Yes. Is anybody still filling out a ballot? Have all the ballots been collected? Love the hat, by the way. Make Earth cool again. That's cool. I like that. We're all good. All the ballots have been submitted. Very good. Thank you. The polls are now closed, and I'll provide a preliminary voting report that reflects the votes submitted prior to this meeting. For Item 1, all 16 nominees for director have been elected, with each director having received at least 94% of the votes in favor. Well done, folks. For Item 2, say on pay, vote has been approved, receiving 93% of votes in favor.
For Item 3, for say on frequency vote, the frequency of one year has been approved, receiving 98% of the votes submitted. For Item 4, the appointment of Deloitte & Touche, the company's independent registered public accounting firm for 2023, has been ratified, receiving 98% of the votes. Way to go, Tim. For Item 5, the amendment to the restated certificate of incorporation to reduce the super majority vote to a simple majority vote has not been approved. It has received 66.3% of the issued and outstanding shares in favor. Remember, we needed 66% and 2/3 . Of course, I wanna remind you that the board supports this proposal. As has been pointed out, I'll just confirm that the shares that were voted were overwhelmingly positive, 98% for the amendment, but we needed 66% and 2/3. We hit 66.3%.
For Item 6, the shareholder proposal regarding the simple majority vote that was presented here has not been approved, receiving 38% of the votes in favor. For Item 7, the shareholder proposal regarding setting Scope 3 GHG targets has not been approved, receiving 20% of the votes in favor.
Finally, for Item 8, as I said before, the shareholder proposal regarding issuing an annual report on the feasibility of reaching net zero has not been approved, receiving 2% of the votes. Because Mr. Milloy didn't show, this proposal was not presented and therefore has not been considered at this meeting. I did wanna let you know that it did get about 2% of the votes. The shares represented by the votes submitted during this meeting will be included in the final voting report, which will be filed with the Securities and Exchange Commission in the next few days. With that, the formal business portion of the 2023 annual meeting of stockholders is hereby adjourned. Chris Womack is now the CEO of Southern Company. Please give him a standing O.
Thank you. All the best. Thank you. Thank you. Thank you very much, Tom. Thank you, board, for this wonderful opportunity. Ladies and gentlemen, I stand before you with a great degree of humility and honor. Thinking back, knowing that having grown up in South Alabama in the 1960s and now where I stand is a very humbling experience, humbling time for me in my life, and I say, board, thank you very much. As I also stand here, I think about the legacy of this company and the legacy of the leadership of this company that has been defined by incredible visionary leadership and incredible focus on results and success. Not being afraid to innovate and change things, but in also relentless commitment to serving customers and communities. For that, I also thank Tom Fanning, who has fully embraced the legacy of this company.
Tom, I thank you. I need to let you know that there will be some forward-looking statements that we'll make. You get the drift. I kinda got ahead of myself there. I probably got, you know, moving a little faster. We're gonna try to slow it down. Again, as I think about the legacy, and as I said, with that visionary leadership and the focus on success and results and all the wonderful things, Tom Fanning fully embraced that legacy and made it better. We are so fortunate to have had his leadership over the past 13 years. Tom came in in 2010, and one of the things he did was he put... You know, Tom, sports fans, this is how we're gonna do this, and all the wonderful references that he makes then.
Tom brought great simplicity to the business model that has served this company so very well, and we knew it. In Tom's own very unique way and how he does things, he brought great clarity to this business model that has provided success for this company for over a hundred years. He called it the Circle of Life. Customers being at the center of everything that we do, and if we do that, we will maintain this constructive regulatory environment, we'll work with our commissions and have this healthy capital spending that will bring about the reliability, resiliency, the price, and the levels of satisfaction that we need to serve our customers and make them feel good about doing business with us. He did that in 2010.
Shortly thereafter, this small little book, but with great power, with great references, with great language, that he called Leadership Perspectives. He brought this to this company to give us a roadmap, to give us a path of how we must lead to challenging us to be leaders, to leaning in, to supporting each other, for working hard and how to do this. Tom Fanning brought this to us. As a result of Tom Fanning's leadership, because of Tom Fanning's embracing and leaning into the legacy of this great company, we are better. And ladies and gentlemen, let's give Tom Fanning a big round of applause. Southern Company is a great company. Southern Company is a great company. We have a team of incredibly passionate people that are not afraid to do hard things and not afraid to do big things. We are a great company.
We've got incredible challenges ahead. We've got incredible hurdles in front of us. We have an incredibly bright future. We are so thrilled with the cards that we have. I wouldn't have anybody else's cards. I mean, we are in a wonderful place, and I am so proud with where we are. Southern Company is a great company. Let me go through a few things that further speak to that. If you look at making a $1,000 investment in the stock some 20, 22 years ago. You see what the returns are and how Southern has outperformed the Philadelphia index, how Southern has performed. That is great value contributions that has been made by investing in this company. Look out a little bit further, Tom's always talks about values, the function of risk and return. You look at the risk profile of our company.
It used to be we were right next to Hormel and Spam. We've moved up a little bit more, but we're still down below in the first quartile. You also look at the total shareholder return one, three, five, 10, 15, up to 25 years. You see kind of the results that we have delivered. A wonderful investment, a wonderful return by this company. You look at our dividend policy, our dividend tracker. We paid a dividend for 76 years. The last 22 years has been either flat or increased. This has been a remarkable success of this company. Then you look at the appreciation of the stock. 70% of it has been through dividends. Again, just a wonderful metric to say what a good investment in Southern is and the returns that it provides to our shareholders.
One of the things we think about as Dan and I think about going forward, as our earning profile increases, as we see earnings grow, that also gives us the opportunity to go to the board and ask them to consider increases in the dividend. It puts us in a wonderful place going forward. Tom talked about Plant Vogtle. Plant Vogtle, we are proud of where we are. Things are going incredibly well. As he said, just yesterday, we achieved the 90% power plateau on Unit 3. We've got about 10 tests, I think to go through over the next couple of days, and we look to move to 100% power. Could be as early as Saturday, could be sometime next week. Just wonderful success there.
If you look at unit four, we've transferred learnings from unit three over to unit four, as you saw that doing hot functional testing. It took us some 96 days, 92 days, I think, for unit three. It took us about 46 days for unit four. We've seen lessons transfer from unit three over to unit four as we go through the completion of Plant Vogtle. We're receiving fuel now at unit four, then we're moving to ITAACs, and you see we're moving down that list down to 102 to go. Then we'll get the 103(g) letter from the NRC. We'll begin a fuel load sometime as early as mid-July. Wonderful progress there. Yes, we've had our challenges.
I'm confident that the state of Georgia and our customers, our company, the world will be so proud of the work that we've done in bringing Vogtle online. This is gonna be an incredible success for a lot of stakeholders. We thank you all for standing with us as we have gone through this process. This is gonna be a wonderful success story for this company. We talk a lot about fleet transition, and this speaks to kind of how we have transitioned the fleet looking back from 2007. You look at the makeup of the fleet at that time, some 69% coal back in 2007 to first quarter of this year, some 14%. Just incredible economic transition that we have made.
This has been good for the company, but also has been incredibly good for our customers, but also good for the environment. You look at the coal plant reductions, the number of units, 99%, 91% reductions in the number of units, some 87% reduction in coal capacity. We've made this through making the best economic decisions for our customers. This is a wonderful result and a wonderful accomplishment for our company. At the same time, you've seen our renewable percentages grow as well from 2015 up to now, going from less than 5,000 megawatts to some 17,000 megawatts into the 2030s. A wonderful success by this company, not being driven by any renewable portfolio standard, but us again, making the best economic choices of generation for our customers.
A clear demonstration of our commitment toward net zero, a clear demonstration of our commitment to make the transition in our fleet. We're also thrilled to have the Southern Company Gas company to be a part of our team as we did the merger with AGL. As you can see, some 4.4 million customers across Georgia, Virginia, Tennessee, and Illinois. They too, with this focus on net zero, working toward net zero methane emissions, delivering customer solutions, enriching their communities and investing in innovation. You see, the CNG truck outside the ballroom, can burn on CNG or natural gas. Once again, the embracing of a technology, the embracing of leadership, the embracing of innovation in all parts of our business. We are so proud of the team at Southern Company Gas and the contributions they are making to this family.
It is a wonderful add, a wonderful contributor to the success of this company. We receive a number of accolades, which I think is another reflection of the greatness of this company. Alabama has been a leader in doing things, you know, that others don't do, as they have been a part, a member of the Alabama Rural Broadband Coalition. I mean, as they do trenching, as they do line work, as they do their grid improvements, they are now partners saying, "How do we make sure that all parts of the state have access to rural broadband?" Making sure families and students and children can have access, full access to technology. This is innovation, but more importantly, Jeff Peoples, this is leadership. This is stepping out, doing things that others don't do.
In Georgia, just last year, we had the largest blend of hydrogen in a combined cycle gas plant, some 20%. We saw CO2 emissions reduce, normal operations maintain at a stable level. Yeah, we had to make some modifications on burner tips and other things, but once again, working with partners at EPRI, working with Mitsubishi, we did this test to demonstrate that it is doable. This will support a lot of other work that we will do as we pursue more hydrogen utilization in our system. Lastly, SEEM, this energy exchange system that we led with other companies now in terms of trading on intra-hour, once again, providing opportunities to maximize the use of renewables, but meeting the needs of companies in this group to meet their needs on an hourly basis.
A wonderful, I think reflection of innovation led by Noel Black and a lot of member of our team who put all this together. We can go on and on. Tom talks a lot about our proprietary research and development. We do this with pride. This is a part of our legacy. We continue to embrace that legacy. We continue to lean into that legacy, and we'll continue to invest more and do more in R&D as we go forward. Just wonderful, exciting things that we are doing. Jim talked about Moving to Equity. This is our framework. This demonstrates our ongoing commitment to make sure that our commitment to equity, our commitment to inclusion, our commitment to belonging is not episodic. We are not giving up. We are not moving on.
We will continue to focus on this framework around equity, making sure that we're talking, making sure that we're listening, making sure that we're getting to know each other. This is not binary, just about black and white, male and female. This is all aspects of diversity being included into the culture and the fabric fully of our company. Also making sure that we're making commitments. We're holding ourselves accountable to the work that we commit ourselves to, but we start the process all over again. This never ends. Our commitment to equity is longstanding and forevermore, and we're excited about the work that we've accomplished and the work that we will do going forward into the future. Talk about accolades. This is a long list.
We got probably three or four or five more pages more, but these are some of the ones that we feel that we're excited about. From DiversityInc being top 50 company, Fortune 2023 World's Most Admired Company. You can see the list. I think once again, this reflects the elements, the aspects of a great company. Southern Company is a great company, and we'll continue to do things to make this company even greater. As we go forward, there's a lot of questions about what we do after Plant Vogtle goes online. We continue to embrace customers being at the center of everything that we do. If we stay grounded around the customer, everything else will fall in line. Yes, we have to do hard work. We have to get it done.
We must keep the interest and the best interest of customers at the center of everything that we do. We'll excel at the fundamentals, all the blocking and tackling. We'll make sure that we continue to focus on innovation, how we make, move, and serve energy, and then how we make sure we're partnering with our communities, partnering with our companies to make sure that our communities are better because we live and work there. What does that look like? It means maintaining a balanced, clean, safe, and reliable, affordable energy solutions for all of our customers, making sure we continue to engage ourselves in advancing the fleet transition, making sure we're meeting all our financial targets and having the level of financial integrity that you expect from us in being regular, predictable, and sustainable in our financial performance.
Transition operations to net zero. We have a goal to be net zero by 2050. The interim goal is 2025. We think we'll be at the interim goal sooner than 2025. As a result, Stan, Connie, and a lot of us are gonna look at do we adjust our goals? Do we move faster? Do we set earlier targets for our net zero goal as we go forward because of the success, because of the transition that we've already gone through and the reduction that we've experienced? I think there's an opportunity for us to advance our targets and advance our goals. Growing our communities. We're blessed to be in a region that is still experiencing some wonderful economic success. That also puts pressure on making sure that we have the workforce to support the economic activity that we're experiencing.
Seeking equitable outcomes for all of our people and investing capital to generate additional strong returns for this company going forward. Just a wonderful platform we have as we look to go forward, as we move into the future. Southern Company is a great company. We have the opportunity to make this company even better. We are in a wonderful place. We've got great cards. We've got a wonderful team leading this company. Together, working together, we will take this company to higher heights and better results and continue to make this company even greater. With that, Tom, you wanna join me?
Yeah, sure.
as you come. 13 years of whatever you wanna call it. I mean, what have you enjoyed most? I mean, what's been your experience? How have you felt about doing this for 13 years?
By the time I finish, so, I'm not retiring, staying on as Executive Chair of the Board which means I'm still an employee, That will carry on for some time. I'll have been the longest guy in this seat.
Yep.
in Southern's history.
Yeah.
I'm very proud of that. I'm very proud of the idea that these folks and the officer corps and, you know, one of the first things I did when I got this role was to move his office right next to mine.
What a-
I've always admired him and...
What a wonderful opportunity that presented. Yeah, he laughs about it all the time. He enjoyed it.
I learned so much from him. I think there was this idea of personal growth and the company's growth. I think as I assume this role, I had David hand it off, the coal plant in Mississippi, Kemper County Plant Ratcliffe, we call it now, and then the nuclear plant, which now we're finishing up. The tenacity to stay with those things and make them as successful as they possibly can be. More importantly, not to let the company get distracted.
Mm-hmm.
You know, it would be so easy to say, "Oh, they're just focused on Vogtle, and, you know, what I do isn't important." Put back up the slide on accolades, if you would. If you look at the what's of this company, and you look at some of the challenges that the rest of our industry has had through ice storms and blackouts and all kinds of stuff. Knock on wood, right? 'Cause it could happen to us. This company has performed like champions. On the basics: making, moving, selling, and I like your service nuance. That's a great thing.
Yeah, because as you know, from a service standpoint, you know, we've done it traditionally based on central station generation, but as their more distributive infrastructure, serving will be different...
Yeah.
and how it gets served. That's the transition we're making in terms of how we deliver energy to our customers.
Those are the what's. Here's the other thing that I'm really proud of, and I think this is a sustaining legacy issue. We've talked a lot about Moving to Equity. It's not the sine waves of public consciousness that we're concerned with. It's not when the headlines say, "Pay attention to this." Our focus on this is those days where nobody cares. We care deeply.
Yep.
Where it's not in the headlines, we will maintain a commitment to that ideal. The other thing, look at this. I mentioned the vets. Number one in our industry on vets. See there, number two, GI Jobs. Most admired. Where's the diversity one up here?
Right.
Eight consecutive year, number one for Black executives, number three for veterans, number five for supplier diversity. Here's the thing. When you treat people well, and the very first thing you do in treating people well is listen. My job as CEO was not to take tablets from the mountain and hand them down. Rather, it is to engage the employees, to make sure that they're part of the decision process. All the credit of this company, over at least my tenure, goes to them, not to me. When those people feel that value, that investment in them personally, you get this Forbes thing up here. 2023 America's Best Large Employees, number 15 overall. Last year, we were number two overall of all companies in America. I think we were 100 places better than the next best utility.
After the killing of George Floyd, and we began this work on Moving to Equity, one of your admonitions was, this work cannot be episodic.
That's right.
I mean, what was your thinking there? I mean, what were you feeling?
It's been a passion of mine forever. Look, you know, when the headlines happen, everybody jumps on, you know, they wanna lead the parade, right? This isn't about a parade, and it isn't about, you know, oh, in this moment, I'm gonna show everybody what I do.
Not a PR campaign.
No, hell no. This is about a cultural commitment to making sure that every employee here, no matter what their element of diversity may be, feels valued and can contribute to the best of their ability. I'm an old sports guy, and I remember under Paul Johnson, Georgia Tech football. Man, we ran the ball 90% of the time. What do defenses wanna do? They wanna make you stop the run. They wanna make you play so-called left-handed. They wanna take away what you do well and make you do something you're uncomfortable with. What we wanna do is increase the bandwidth so that we get people here that are not necessarily Black and White, male and female, and gay and straight, and Christian and whatever it is. We get people here.
The value of diversity is breadth of background, of context, of skill set, of judgment, so that we live not only in the moment, but we live for the future, so that these unseen corners of the future, we have better vision and courage in which to adapt to whatever comes. The final admonition is the greatest movie ever made, Casablanca. One of the great lines in there is the police chief says, "Well, I just take what comes." To heck with that at Southern. Our job is not to take what comes, but influence the future and make it as good as it can be for you, our shareholders.
Last question. What's your old man advice to the company as we go forward? I mean, the wisdom, the experience and as you look around corners of being, what's your advice to the company? What's your advice to the team?
You know what? I'm gonna keep this one short.
Sure. How do you spell short? They asked us if we were going to be organic.
I'm telling you. Hey, you know what it is? When I got this thing, I celebrated. We were right at the 100-year anniversary. Remember that? We created the book Big Bets. Isn't that so ironic? Big bets.
Yeah.
We've had a few of those. I think the issue is this, honor the past, build for the future. We've been so successful. One of the greatest harbingers of future failure is past success. If you look at it, people get addicted to what they've done in the past because they were successful. You can't do that. You must continually have the courage to reinvent yourself, to attack conventional wisdom. I tried to celebrate people in our company that were so-called revolutionaries, people that thought differently and asked why and why not. I can tell you, there were so many people in the past that were so successful, they wanna kill the revolutionaries. You don't understand. This is the way we did it last year.
Raising up the value of the revolutionaries has been so valuable, and instilling in this culture the courage to be different and to innovate and to continue to improve. Fire in your belly to make today better than yesterday, tomorrow better than today. Now even more playing offense, fire in your mind to be inventive, innovative, and have courage.
Shall we take some questions?
Please.
We're gonna do this. We got lunch at noontime, we're gonna go until noon.
That is a little bit of a departure. We went two hours and 45 minutes last time.
45 minutes.
Yeah. 2:40.
2:45.
Yeah.
Yeah. 2:45.
We got a lot of feedback. We are gonna try and be respectful of everybody's physical condition in here. Try and end around noon. We're not gonna be nerds about it, but we do wanna be respectful of everybody here. We're trying to consolidate. We're doing something a little different. You filled out cards out front. Laura has collected the cards, and we're trying to categorize them so that we don't have duplication and we're efficient. Please bear with us in this experiment this year.
Yes. Laura?
Great. The first question is from Sam Brewer, and it is about Tom Fanning's retirement.
Big Sam has been here... Sam, how many years?
About seven years before you came.
that'd be 20.
20.
20.
How many years? That's fabulous. Sam, we always appreciate you coming. He's working his way to the mic. Again, a great friend of the company, and he's always urged us to do better and do more. I think, Sam, through your efforts and others, we're better.
Sam, where's Ronny Just's coat you had?
I'm sorry.
Where's Ronnie Just's coat?
He took it back.
Oh.
I wish to thank Mr. Fanning for agreeing to put solar panels on my house. The two previous chairmen before him refused to even acknowledge my concern when I stood up and asked them. Mr. Fanning initially told me he would look into it, and he did. Every year, he kept us informed about the solar energy. After a few years, he had my solar panels installed on 12 April, 2015. As retired military, I was especially pleased to learn when Mr. Fanning was chair of a presidential committee, he was asked by the president to come up for a way to safeguard our military bases in the event of an enemy attacking the national power grid.
Mr. Fanning had solar panels installed on all of our military bases in Southern Company's area of responsibility and recommended across America that all the major power companies do the same. Yes, we pay Southern Company for the power they use as they always have. Thank you for reaching out and listening to the concerns of your shareholders. Again, it has been a pleasure for my wife and I knowing you and attending shareholder meetings.
Thank you, sir.
Thank you, Sam.
Appreciate it.
Thank you.
You all may know I have solar panels on my last house. Anyway, good stuff. I've always been an advocate of solar. Solar makes so much sense for Southern Company in the renewable sector. We do have some wind, but we import it from Kansas and Oklahoma via long-haul transmission lines. Solar is a big deal to us.
Laura, next question.
We got several questions on fuel cost and fuel cost recovery. We have selected Charlene White, representing Sierra Club to come present her question on that topic.
Charlene, where are you? There you are. Charlene, another longtime friend of the company. I can tell you, Charlene, I bet you could speak for this, but Sierra Club, you know, we've had kind of an interesting history if you go way back. I would argue over the past 10, 13 years, we've had a terrific constructive relationship. Personal friends in the Sierra Club, and you guys, again, have made us better. Thank you.
Thank you. I'm gonna sprinkle a little bit of equity here. I'm Charlene White. I come from Costa Rica. Who's been in Costa Rica? Raise hands. All right. Some of you know what pura vida is, right? Full of life. I wish both Chris and Tom the best in the next process that you're going through. Change is constant. Change is inevitable. I think I butchered that. English obviously is not my first language. I wish you the best.
Thank you.
Thank you for this opportunity. I'm gonna frame my question in as a fact, problem, and a solution. Fact, for the last 40 years or so, fuel costs have been 100% passed through the customers. Fact. Southern Company does not profit from fuel management. That's fact. The problem, fuel costs are one of the biggest line items in customers' bills, and people are feeling the brunt. Solutions, a modernized fuel cost share mechanism that centers around customers' needs by reducing their electrical bill, and if done right, can yield earnings, yes, you heard me right, earnings to the company.
My question to both of you gentlemen is: Would Southern Company consider supporting an earning incentive for fuel sharing where the utilities fuel cost management net gains and losses are shared between the company and ratepayers, especially since so many non-fuel cost technologies are now available at scale?
Chris, why don't you?
Yeah, I'll start by saying I think it's something worthy to consider. I mean, I'll also say to you, as we make fuel decisions, once again, we're making economic decisions in terms of fuel sources, buying fuel, coal, gas, and we're making significant economic decisions as we make those choices. The other thing is, as we talk about this balanced portfolio and all the arrows in the quiver, once again, I think that helps us mitigate some fuel cost volatility and exposure as we have this diverse portfolio. In some places, we do have hedging opportunities around fuel. We continue to find ways to minimize the cost impact and the volatility impact on our customers through a lot of different strategies and programs that we have at our companies. Is there some more we can do?
I mean, I think we'll talk to Jeff Burleson and some others at our companies to say, are there some other sharing mechanisms we should consider? We'd be glad to take a look at it. Once again, know that we have a sensitivity around pricing and the cost of our product. As we look at the portfolio, we're always trying to find ways to minimize and mitigate volatility and price impact to customers. We know that impacts the total bill, we wanna keep that total bill as low as possible.
Chris has done a heck of a lot of work since you've come on. Your background is mostly external affairs.
Yeah.
A Washington guy, a national leader. We're so gratified that as he's come into this new role, became president in the end of March, one of his very first things was affordability.
Yep.
Really focusing on keeping costs low and understanding that particularly for the people on the lower end of the economic spectrum, their energy share of their household disposable income is really big in the Southeast. That's a big deal to us. We wanna reduce as much of that pressure as we can. One last comment, and I so appreciate you raising the issue. About half of America is in these so-called organized markets. In those organized markets, let's just use Texas as an example, people make money off of fuel. They love it when you see spikes, and they profit from that. That's not what you're saying. Your suggestion is different than these flawed organized markets that really don't work very well. Your idea, I think, and I'm asking, is to assure that if there are savings, if there are benefits by doing something different-
Mm-hmm.
in the fuel regime area, that we profit from going lower, not higher.
Correct. We're not even closely saying, "Let's split 50/50." That's irrational.
Yeah.
Not even 80/20. Our experts say that a small risk can actually benefit and make a difference, both for customers and potentially for shareholders.
That's right.
I appreciate the opportunity, and on behalf of the Sierra Club, I love that we are able to make this connection. As you know, I am a woman of my word, so I will follow up with Jeff and Chris.
Yes.
Pura vida.
Thank you.
Thank you so much.
Thank you.
Thanks for coming in.
Thank you, Charlene. Thank you very much. Laura?
Yes. Because of that, I think we're gonna put the next topic as market reform. We have Bryan Jacob here with a question about market reform.
Bryan, welcome. Thanks for coming.
Yeah, thank you. I'm Bryan Jacob, representing Southern Alliance for Clean Energy, and I do wanna talk about market reform. Your last comments sort of touched on that already, so thanks, Laura, for reshuffling. The context for this is that over to our east in South Carolina, the General Assembly commissioned a study of market reform.
Mm-hmm.
That it was done by Brattle, and it was published, just about three or four weeks ago. The conclusion over there was that an organized market with the same footprint as SEEM, so Chris, you had mentioned the leadership that The Southern Company exhibited on setting up SEEM. Same footprint as SEEM would generate between $115 million and $187 million in benefits for South Carolina alone, and that's net of costs. We can reasonably estimate that for the broader footprint, for this business, would be somewhere in excess of $400 million a year, considerably higher than the savings from SEEM itself. Since you've exhibited leadership on SEEM, my question is, can The Southern Company continue that legacy of leadership, and champion this market reform effort?
You wanna start that one?
Man, I love this. I really do. You guys know that in addition to my role now as Executive Chairman of the Board, I have a whole lot of external things that I do that I think are helpful for America and helpful for Southern Company as a result. One of the things I do is I chair the advisory board to CISA. This is the cybersecurity agency inside Homeland Security. I've also been on the Cyberspace Solarium Commission, which is reimagining national security in a digital environment. One of the things that we are very conscious about in America right now is the notion of resilience. We have seen the damaging effects of if we lose a gas pipeline with Colonial. We have seen attacks on our system. I used to never say this, but now I say it pretty frequently.
Southern Company gets attacked in a cyber sense 3 million times a day, we're able to fight those things off. There is the notion of integrating, collaborating the private sector with the federal government in order to assure that we have a resilient system. With all due respect, I think the organized markets are fatally flawed in this regard. As you point out, people will do studies that will show, oh, there are savings in the short term by maximizing your electricity supply function around a short run, they call it marginal cost basis. That's how organized markets are typically structured, short run. Do you guys remember Silicon Valley Bank went bankrupt, okay? What was their fundamental problem? They had a mismatch of short term and long term based on their assets and their liabilities.
There is no organized market that is built off the short term that will support the viability of long-term assets. None. Doesn't exist. When we think about how you should structure our business, we say clean, safe, reliable, and affordable. That is an and proposition, not an or. You can't construct a market on short run profitability or cost. We must take into account building a long-term portfolio that maximizes the union of those qualities. There is no short-term market, no organized market that pays sufficiently for resilience. Look at Winter Storm Uri in Texas, they went black. Look at some of the recent, what is it, Elliott?
Elliott.
Some parts of the U.S. had rolling blackouts. When you think about the resilience required to support the attacks on our electricity grid, we need more than a short-run marginal cost signal to make sure that Americans are protected on the worst of days. Our integrated regulated market in the Southeast is absolutely the right way to approach balancing short and long run benefits. I absolutely believe, and I certainly appreciate the viewpoint of others. Different people can respectfully disagree. I absolutely believe that the organized market approach to the U.S. , which was founded on the basis of Texas many years ago, is a flawed science experiment. They need to figure out how to get back into providing for value on long-run assets. They don't do that now. One last example.
As wonderful as we're gonna celebrate Vogtle 3 and 4, tell me, how many new nuclear plants are surviving in these organized markets? Some of the most valuable assets we have as a nation are getting shut down. That's because these short-run marginal cost signals don't support long-run assets. It is a bad flaw and bad for America. Thank you.
Thank you, Bryan. Thanks for your question. Laura?
Yes. We've had a number of questions addressing energy efficiency and IRA, including carbon capture and other benefits of IRA. I think Norman Slosky might have a good representative question on the topic.
Norman. You've been here 100 times too, right? How many years?
Not quite 100. Maybe about five or six. We've been... Excuse me. We've been talking about the supply side.
Yeah.
Let's talk about demand side.
You bet.
Also, we have not mentioned very much the Inflation Reduction Act, the IRA.
Yeah.
The incentives that it creates both for customers
Customers.
for the company.
Yep.
It really changes the landscape. A few years ago, actually last year or the year before, companies started a on-bill financing for efficiency. The problem with that program is that no incentive for the company, not making money off it, and it's not a profit center, it's a cost center. Frankly, it's not been very successful. Now with the Inflation Reduction Act, IRA, customers can get rebates or, and/or tax credits, and the company can get rebates and/or tax credits.
Mm-hmm.
Southern loves tax credits. You've always talked about that. How could you design a program that creates incentives for the customer and for the company to utilize the IRA rebates and tax credits? Also, Southern Company is having a challenge with more demand data centers.
Mm-hmm.
Yeah.
Yeah. That's absolutely right.
You're gonna have to have more capacity, and efficiency can create more capacity as well as other generating facilities. How do you deal with that in the new landscape?
Hey, let me.
No, no. Let me.
Data centers, what do they require in terms of reliability? 100%.
Yes.
24/7, baby. You'll see more of that here than elsewhere.
Yeah. No, no, you want it?
No, go ahead.
No, you.
No, no. I just wanted to jump on the data center comment because you're absolutely right.
No, no. I mean, we have a history, a legacy of leading on energy efficiency across our companies, and there's not one solution on energy efficiency. We got a team of folks, Chris Kaminski and others, are scouring the Inflation Reduction Act, finding all kind of opportunities for us to participate. We're gonna do more. As we are blessed to have this new generation and new demand come into our territories, yes, a part of that solution, meeting that need, meeting that load is through energy efficiency. It's got to be a part of that mix, and we'll make sure that happens. Please, I mean, I won't say totally be comfortable about it, but yes, we're gonna fully invest.
We're gonna fully find ways to take advantage of the Inflation Reduction Act, as well as pursuing additional opportunities for energy efficiency as a part also as our strategy to address affordability. Energy efficiency has got to be a part of that solution as well. I hear you. I mean, we're fully on board. We're gonna continue to do more around energy efficiency.
Bryan Anderson is here. Where's Bryan? Bryan, there you go. He runs our Washington office and a variety of other things, too. He does all the PR and all that. We were big supporters of the IRA. What that does broadly to us is just reduce the cost curve in getting to the transition in net zero. You were focusing on the energy efficiency stuff. Amen, brother, I agree.
Yep.
Broadly, you said we love tax credits. This thing is technology agnostic, and it will help us keep the cost curve low-.
Yep.
as we transition to net zero. The way Southern does it, all the benefit from these tax goodies go to our customers.
Well, thank you.
Thank you, Mark.
Thank you. Thanks for your question.
Appreciate it, Norman.
Laura.
Great. The next question we have is from Brittney Linton. It is about clean energy and community impact.
Brittney.
My name is Brittney, and I am a member of Green Workers Alliance. You were speaking about clean energy, renewable energy. Well, I actually work in renewable energy. I came from corporate background, and I actually quit a salary job, and I started working to support my ex-husband at the time. I've been able to work directly with individuals, you know, people of all different types of backgrounds, and I think that there needs to be a little bit more concentration on the workers that are out there working every day. You talk about, you know, leaving a legacy, and we all know that renewable energy is just gonna continue to grow.
Mm-hmm.
What can we do to hold these contractors? Example, you have Alabama Power, and they have a, I guess, a contract with Mitsubishi Power, I believe that was coming up in March 2024. It's on your Southern Company page, and they are one of your companies, but that's where I found it at. They have a site that's gonna be coming up in Alabama. You have workers, and if you support the community, it's gonna be bring in, I believe it said $9 million in tax revenue. What can we do for the workers that are out there every day, their safety, their per diem?
Some of these companies, Strata Solar, which is under your Southern Power, sometimes they don't get per diem, they can't pay for their hotel, yet we're out there building these sites. How can we hold these contractors more reliable? How can we, I guess, change the regulations and the rules so that we can make sure that these workers are out here and that they are safe and that they are having, you know, like, it's proper treatment. It's not, you know, the buddy buddy system. I had the opportunity to move up in the company. I had the opportunity right now. I'm still getting paid while I'm, you know, coming here, where you have other individuals who don't even get per diem. You know, they drive two hours. They drive from here. They don't get their 15-minute breaks.
Yet y'all are giving these contracts to these different companies, and these electric companies are, you know, putting the money out there. How can we make it better for the workers that's out there working?
It's a wonderful question, and we use a lot of contractors in our business. We don't direct what they do. We don't, you know. They are contractors. The questions you raise says to us, maybe there's an opportunity for us to sit down with the contractors, understand their work profiles, understand their safety profiles and their working conditions, making sure we're having good conversations with them and encouraging them to may not do it the way we do it exactly, but making sure they have the right kind of standards and considerations for worker safety, for wages and all those various implications as they do the work. This is great feedback for us and something that we'll take into consideration as we engage with our contractors.
I want you to know too, this company has historically been associated with building strong alliances, particularly with covered workers. Jeff Peoples for years. Jeff, stand up. He's the new CEO of Alabama Power since Chris took over. Has been central to that relationship, we all have. Sean McGarvey and I, Sean is the President of North America's Building Trades Unions. He and I got a national award recognizing Southern Company's alliance with workers to make sure that we have a fair, equitable, and growing relationship. Steve Kuczynski, where are you? Sena. There's Steve, stand up real quick. He's the CEO of Southern Nuclear, President of Southern Nuclear. Pete Sena, stand up. We couldn't have done Plant Vogtle 3 and 4 without the IBEW and the other trades, the pipe fitters and everything else.
Listen, we get completely having a constructive relationship here, and so we'll continue to work on that.
Yeah. this is great feedback, and we'll follow up on it.
Thank you.
Thank you very much. Thanks for your time.
Thank you, ma'am. Appreciate it.
Thanks for being here.
Thanks for coming.
Yes. Laura?
Yes. We had several questions talking about our greenhouse gas targets.
Mm-hmm.
Both Scope 1, Scope 2, and Scope 3. In light of the shareholder proposal, we thought a question specifically focused on our Scope 3 targets might be appropriate. Ed Outlaw from Peachtree City here today.
Hey, Ed.
Hey, Ed.
Welcome.
Thanks for coming.
Thank you. It isn't afternoon yet, right? Good morning.
Not yet. It's not noon yet.
Yeah.
It's fastly approaching.
Before I start my question, I just would like to say, you mentioned, Tom Fanning mentioned, listening to your employees and treating them right, I see that also with shareholders at this meeting. I really appreciate that, being willing to listen, and being nice to people. My question's about upstream methane emissions, related to purchases of gas, both for electric generation, and for distribution and resale. Upstream methane emissions are significant greenhouse gases related to the activities of Southern Company. To put a perspective on this, there was a study done out of Cornell University that determined greenhouse gas footprint of shale gas is greater than that of coal.
Hmm.
You know, of course, there's less CO2 produced when you burn coal than when you burn, I'm sorry, when you burn gas than when you burn coal, but that's offset by the upstream methane emissions. While Southern Company has reported reductions in greenhouse gas emissions from switching from gas to coal, to gas from coal, these reductions are, in effect, not actual net reductions, at least not to the extent that they come from shale gas, from fracking gas. I'd also like to point out that it's possible to measure methane emissions on a source-by-source basis as opposed to an average basis, and this capacity is increasing. There's now satellites that can look on a site-by-site basis and determine methane emissions and measure methane emissions.
There's OGMP, significant funding for methane emission monitoring in the Inflation Reduction Act. Southern Company has the power to have a significant impact on greenhouse gas emissions here. For example, Southern Company could require that gas acquisitions come from sites that are low methane emitting. However, to put a focus on reducing methane emissions, it's necessary to include Scope 3 emissions in your measured target for greenhouse gas reductions. To use a sports metaphor, to put it on the scorecard. Which is why I encourage you to consider adopting the shareholder proposal on Scope 3 emissions. In many ways, Southern Company is an industry leader, with regard to addressing climate through greenhouse gas reductions, Southern Company is not leading.
Duke Energy, for example, has agreed to include scope three emissions in their net zero target, including upstream emissions as well as downstream, as has Dominion. My question is, when will you agree to include scope three emissions, especially upstream methane emissions, as part of your net zero target?
You wanna take that?
No, it's a wonderful question. Let me start, then you chime in. Be clear about our commitment to reduce methane emissions. I mean, there's a clear goal, clear effort by Jim Kerr and others at the gas Company and all the work we do on methane emissions. I think, and I can't speak for other companies, but I think trying to get a handle, a full picture on Scope 3 emissions at this point is very difficult and almost impossible as you go through the value chain. To put a target on it, to understand what the numbers are, an inventory, I think is almost impossible at this point in time.
There's a lot of work that we'll continue to do to get better at it, but I think it is early in the game to have a real handle on what the ballpark is of Scope 3 emissions. Like I said, we're gonna keep pushing. We're gonna keep working. We're gonna keep getting better at it. As you go through that value chain, the disposal, just all the aspects of it, I think is so complex, we're not there yet. We're committed to doing the real work to fully understand what the numbers are around Scope 3 and then setting the appropriate targets and timelines over time. I just don't think we're there yet. I think companies that say they can set those targets and set goals are being a tad bit premature. That's my view.
Couldn't agree more. I'll just add to that. Everything he said is accurate. Nobody out there, even if they've committed to some goal, is doing more than we're doing in terms of assuring that we minimize the emission of greenhouse gases. We have programs in place on our procurement of gas for generation. We have at the gas company, we have renewable gas programs in place. Listen, nobody out there, even though they're committed to trying to figure out Scope 3, is doing anything that we're not doing. We're doing that and more. The other thing, just inside baseball, I'll tell you, and I'll leave the names out to protect the innocent or those that are guilty. They don't know how to measure this stuff either.
You know, I'm very fond of saying that this is a company, Southern Company is a company that's not into rhetoric. We're into action. When we commit to a goal, and just as Chris said, if we can't measure it with credibility, then it's hard for me to say that we're committed to something we can't measure. We need to figure it out, and we're working very hard.
Yeah, we're gonna do it.
as you say, to figure it out.
Yeah.
Some of those companies called us immediately and said, "How do we do this?" Because we have such credibility in research and development and the technical side of our business. I can assure you, shareholders, we get it. Scope 3 is important. If we can somehow figure out how to measure it or hold ourselves accountable for something that currently we're not accountable for, then we're in. Right now, we just have a difficult time connecting the dots on how to be accountable for Scope 3.
We hear you.
We get the principle.
We hear you.
Yes.
Thanks for your comments.
100%. We're working on it.
Thank you very much.
Thank you, sir.
Laura.
Thanks for comment.
The next question is on ash ponds from Ronald Allen.
Ronald, where'd you go? Here he comes. No? Here he comes.
Here we go.
Ronald, welcome.
Thank you.
Thanks for being here.
First annual meeting I've come to. Give you a little background, I worked for EPA as an enforcement attorney for 10 years, Monsanto 5, and Georgia-Pacific 18 years as an environmental attorney. I have a concern about your Barry Plant, where you have a ash pond that was started in 1965, which makes it about 58 years old, and it has 21 million tons of ash. It does not have a bottom liner. You all are proposing to take the ash, dry it out, and consolidate it, but keep it in the pond with some changes. Yet the state of Virginia, North Carolina, South Carolina are requiring their companies to take the ash out and put it in a secure landfill. Georgia Power has 29 ash ponds in Georgia.
19 of those, they're gonna take the ash out, put it in a secure landfill, make sure the environment is fully protected. The Barry plant doesn't wanna do that. The Barry plant is on the Alabama River, goes to the Delta to Mobile Bay. The biologist E.O. Wilson called the Delta arguably the biologically richest place in America. It has, let's see. I think it's 350 different birds. It has reptiles. It has everything. It is something that must be protected. My question is to the... Let me make one more statement. This is Alabama Power's own emergency action plan says that more than 30 miles of the Mobile-Tensaw Delta would be covered by coal ash in the case of a breach. The length of the Mobile River to the state docks is 27 miles.
You would cover the Delta and part of Mobile Bay, which would destroy the Delta. My question to the Board of Directors of Southern Company is, if you all get it, why are you letting Georgia Power do the correct thing, but not Alabama Power on one of the most ecologically sensitive areas in the U.S. ? Why don't you tell Alabama Power to take the ash out and put it in a secure landfill?
Thank you.
Thank you.
Thank you.
Very good question. First of all, I'll start by saying all of our ash ponds are in compliance with the appropriate state federal laws. They're in compliance.
I disagree.
If you choose to.
Okay. There is a regulation which EPA says that if the ash is in groundwater, it must be removed, and Barry's ash pond is in groundwater. That's it. Thank you.
No, thank you.
Thank you, sir.
Thank you. Once again, we're in compliance with all federal and state laws as it relates to ash ponds. The second thing about Burleson and Peoples in this team on a regular basis are reviewing the dikes, reviewing the barriers. I mean, we're consolidating the ash ponds to remove it farther away from the Mobile Bay. They do analysis on an ongoing annual basis, looking at storm history for the past, I think, since 1965. Looking at storms and going even to other extreme conditions in terms of what would happen to those ash ponds under more extreme conditions, and those ash ponds can withstand those extreme conditions. We're continuing to monitor the ash ponds, strengthening the dikes, consolidating the ash into a smaller space.
The work is being done to make sure that we're sensitive and appropriate to the issues in that area as it relates to those ash ponds. We're not sitting back and just watching. That there's always ongoing, continuing work to protect the safety of those ash ponds and protect the safety and security of that environment. We understand the importance of the bay and the whole estuarine territory down there. Be clear, we're staying on top of the work, and we'll continue to be in compliance with all state and federal laws.
I wanna say this, Chris speaks with great credibility here. You were the senior vice president in charge of all of generation for Georgia Power.
Yeah.
for some period of time.
Yeah.
He's just not giving you rhetoric again. This guy has been in charge of this. You also may know that, I guess before I got this job, I was COO. Chief Operating Officer. Those of you that have been around for a while at these annual meetings, you may remember I made some news several years ago about coming out here and saying, for the first time anybody's heard it, we're gonna shut down our coal plants. Made news here. We did that before we were required to. With respect to Plant Barry, I personally have walked the boundaries around Plant Barry. This is something where we don't sit in the ivory tower and listen and think about things. We actually get out there and get the boots dirty. We're fully aware of Plant Barry.
We work with the Alabama EPD, and we have jointly with the EPD and with the EPA-
ADEM, ADEM.
ADEM, I'm sorry.
Alabama Department of Environmental Management, ADEM. ADEM.
We work with them in conjunction with the EPA to have a plan to address all these issues. We do comply with everything.
Yeah.
We are not out of compliance anywhere.
We hear you, and we'll continue to monitor. We'll continue to pay attention. We understand the importance of that part of Alabama, the Mobile Bay, the Alabama River. We get it.
We get the whole issue, too.
Yeah. Yeah, you know, people forget, we do care about the environment. I mean, we care about the environment. We live it. Our families, we participate in it, we're gonna help protect it. Yeah, we hear you, but we're gonna continue to do the work to make sure that the ash ponds at Plant Barry are in fact protected, they're secure, and they're safe.
Okay. The next question is about Plant Vogtle 3 and 4 costs.
Mm.
This is from Robert Searfoss.
Robert.
Thanks for being here, and this is the first time I've been at the annual meeting in person. Last year, I was outside with a sign.
Well, thanks for being here, man.
Welcome. Welcome for coming inside.
Yeah.
Thank you.
Yeah.
This relates to, of course, the Plant Vogtle, which is a big deal for the company. The typical customer, I think in general, the typical customer, the Georgia customer, has paid about $1,000 in surcharges to help finance our plant. They've paid that surcharge without compensation: no stock, no bond, no note, nothing. That money has been taken from the typical customer, about $1,000. Now, what is your thinking on who is gonna pay in the future for the mistakes in construction and to correct the mistakes in, at Plant Vogtle 3 & 4? We know it's a lot of money.
Mm.
We know it's not, it's not a secret that a lot of expensive mistakes were made there and corrections had to be handled, and it costs a lot of money. The question really is, who is gonna pay? Is the customer gonna have that put on their backs after they've already given $1,000 for the typical household? Now, I haven't paid $1,000. I'm really energy efficient at my place. In the winter, I wear a jacket and a hat in the house.
Thank you very much, sir.
What's your thinking on who is gonna pay for the mistakes and the corrections, the cost of corrections?
You wanna start?
Sure. Thanks for that 'cause we need to keep telling this story. The customers, I believe. Now, Kim Greene, where are you? Stand up. Stand up. Kim is the CEO of Georgia Power, okay? Thanks, Kim. We have in front of us a proceeding to ultimately recover the cost of Plant Vogtle, and some of those costs were incurred during construction and paid for, okay? We could not finance that plant. We could not take the burden of constructing this thing without the recovery of some of the costs during construction. That's the money I think you're talking about. That's not unusual. As Georgia Power builds assets, whether it's meter sockets at your house or transmission lines or building new solar, we put those in rate base on a regular basis, and customers pay for our investment.
What you're seeing at Vogtle is a similar arrangement. With respect to the total cost, this is often reported incorrectly. We know that the total cost of Plant Vogtle is really high. Customers aren't gonna pay for that total cost. Along the way, even before we started construction, we entered into a series of commercial relationships with our constructors so that burdens of cost or mistakes, as you put them, I don't like that word because I don't think there were mistakes in the classic sense. We can talk about those in a minute. I think we have commercial arrangements where different people bore the cost of something that they did. Westinghouse, during construction, went bankrupt. As Westinghouse, the original constructor of the project, went bankrupt, we negotiated a contractual arrangement with their parent, Toshiba.
The U.S. government really helped us in working with not only Toshiba, but the Japanese government, to assure that Toshiba paid us 100% of their obligation, in this case, $3.7 billion. That's money that's offsetting any customer burden. Along the way, we've written off some stuff. I think we've written off over $3 billion ourselves. Look, the total bill is not gonna be borne by the customer. It's gonna be something much smaller than that. In my view, we're gonna be faithful to customers in terms of what they thought, what the Commission thought Plant Vogtle would cost at the end of the day.
No, I think you hit it. I mean, just we'll be sharing in the total cost of the project. Customer would not bear the total cost of this project.
And, and-
Shareholders and others will participate.
Let me add just one other thing, the characterization of mistakes. I do just wanna say that because so many people have given their time and their life to make sure that Vogtle's successful. Think about what we've been through. I mean, Vogtle started before I got this job 13 years ago. When you think about the changes in conditions in America, the Westinghouse bankruptcy, economic malaise, COVID, for heaven's sakes, and waves of COVID, where we had to change the working environment of people to keep them safe on the site. We had 9,000 people on the site when COVID hit. How did we keep those people safe? Look at what would have happened if we had not had the courage and tenacity and just stopped.
This board had very long deliberations about how we continue to make that project successful. Boy, other mistakes. Changing condition. We had a single license, a single design, the Westinghouse AP1000 design, which we think is the best designed nuclear plant in the world today. As you put it on the site, you find things that are different than what you originally thought when the thing was designed. We had to make adjustments along the way, license amendments. There's no design in the world that can contemplate everything in the future. I would argue the NRC, we have two former chairman of the NRC, Kristine Svinicki. Son of a gun. I think the NRC is one of the toughest regulators in the U.S. , but I think they're exceedingly fair.
I think they've done a good job with us, Steve, Pete, in working through the problems that arise. Son of a gun, it's working. We're right on the doorstep of unit three going in service. If you look at the improvement on Vogtle 4, the second plant, we're seeing enormous improvements. Anyway, thank you.
Yeah. You just said, but I do want to add 'cause I don't think we said it during this program, but we expect unit three online commercial by the end of June of this year. Unit 4 could be online as early as the end of the year or no later than the first quarter of 2024. Wonderful accomplishments, wonderful success. That's gonna be great benefits to the customers in this state, to this state, to our company, but I think a major signal to this country that we can do hard things. We're excited about where we are and where we're headed.
Yeah.
Thanks for your question.
Yeah. Thank you.
Yes.
Next is Neil Sardana with a question about Southern Company's legacy.
Neil, I love legacy questions, man.
All right. Let's.
This is your second year here.
I joined y'all online during the pandemic, but it's...
Oh, okay.
Good to see people in person, face to face, in 3D, as I like to call it.
Hey, you're always welcome. Thank you.
All right. Thank you very much. Yeah. Thank you. You know, I would like to appreciate all the investors and Southern Company employees for being here today at this important meeting of the shareholders of Southern Company. Especially like to thank our esteemed host, CEO Tom Fanning, for putting on quite a show for many years. Tom, you've crafted quite a legacy in your tenure as the leader of our company. Unfortunately, this legacy has led to an over-reliance on coal and gas-fired power plants that emit or leak massive amounts of greenhouse gases, which pose a significant risk for our long, long-term profitability and certainly leads to devastating impacts upon our climate.
Furthermore, this legacy of resistance to invest in and transition to clean energy sources such as solar has put us way behind competitors in the race to eliminate the use of harmful fossil fuels. The nation and the world are moving forward with clean energy. Unless we transition, that shift threatens our future revenue streams and exposes our investments to further major losses. Southern Company's environmental legacy has left our water and air polluted with colossal amounts of toxic emissions and millions of tons of poisonous coal ash, leading to serious health consequences for the communities in which our utilities operate. This exposes us, as shareholders, to serious legal and regulatory risks and the financial implications they carry. Our legacy of out-of-control energy prices has left our three states of Alabama, Georgia, and Mississippi with some of the most overwhelming high energy burden levels in the entire nation.
Our lack of support for struggling customers and sudden massive rate increases has led to negative publicity and public backlash that seriously damage our brand image and reputation. Thousands of customers' utilities were shut off during the pandemic crisis, causing many additional deaths from COVID. This legacy has contributed to the corrosion of our democracy, with some of the most lobbying dollars spent by any corporation in the U.S. on climate denial and against protections of our environment. Southern Company was even caught funding politicians who were sponsoring voter suppression efforts. Denying reality and considering and trying to use insider connections to prevent accountability may only delay the inevitable, but are certainly not good practices, good business practices to rely on. Long-term, these lobbying tactics only undermine our confidence and trust in our company.
Finally, this legacy has laid a track record of mismanagement and poor financial decisions that cannot be ignored. Massively botched projects such as Vogtle, as we discussed, and the complete failure of Kemper have cost shareholders billions. These financial blunders have eroded shareholder value and have also damaged our confidence in Southern Company's ability, not only to deliver consistent returns, but to also make sound decisions. Fellow shareholders, it is expected for our leader and CEO to stand before us and paint a rosy picture of our company's history. It's essential for us to be honest about the legacy, given the negative impacts it has laid upon the communities we operate, and the impacts we have experienced as investors.
This legacy of overreliance on fossil fuels, resistance to clean energy, environmental devastation, climate denial, and financial mismanagement puts all of our portfolios at a significant risk. Unless this company reverses course, it is likely to be a poor long-term investment of our collective resources. My question is to you, and unfortunately, this may be better suited for your successor, Chris Womack, to answer? How will you deal with this tumultuous legacy and pave a better future for Southern Company that puts us in line with our customers' needs, the communities and the environment we impact, and addresses future generations so Southern Company can begin to inspire amongst shareholders confidence regarding our long-term investments with this company?
First of all, let me thank you very much for your commentary and your question. You wanna start, or you want me to start?
No.
No, no, let me take one first.
Okay.
Because your comment about during the COVID period about shutoffs was wrong. Okay? That is not what happened in our territory. There were not disconnects. The death that you associate, refer to, I don't know where you got that from.
There are studies that prove that.
I, I-
That disconnections during COVID-
I'd love-
-increased-
Yeah.
mortality of people from COVID.
Were you referring to our territory?
I'm referring to in this nation, if people-
Oh, across the nation.
Yeah.
Okay.
COVID wasn't different in Georgia, Alabama, and Mississippi.
I-
It was-
I would beg to differ.
Okay. That's fair. I mean, there are studies that-
In terms of our practices of disconnects.
Hang on. Hang on. We didn't do disconnects.
That's not true as well.
Well, COVID impacted everybody, but our policy during this time-
Yeah.
-was to enter into the most meager arrangements for-
Yeah.
-paying your power bill and keeping your lights on. We fully debated that as a board, as a management council. What Chris says is true. We had minimal, if any.
Yeah.
disconnects during COVID.
Yeah.
That is the policy of this company.
The Public Service Commission in the state of Georgia has the records from Georgia Power that detail the thousands of disconnections that occurred. Definitely, beg to differ on that one.
Yeah. We'd love to talk to you more about it.
Yeah, we'll be glad to do that.
Yeah. Yeah, we will.
Okay. That's fair.
Hey, again, I think Chris says thank you.
Yes.
You know, look.
Thank you.
I get everything that you're saying from your perspective. I obviously disagree with it, your perspective is as valid as mine, I suppose. Here is, I think, one of the things I would like for you to think about as you modify, change, or redouble on your perspective, that is, before I got this job, something like 70% of our energy came from coal. This company, when you consider all of our energy resources, is in round numbers, this analogy is a little bit dated, but it's still reasonably accurate, that we're about the size as the nation of Australia. This is a great big enterprise. You all went and heard, said, "Oh, you can't turn the battleship. You can't," you know.
We have moved from 70% to first quarter 14% energy from coal. We have plans to take it all the way to 0%. We were the first company to say low to no emissions, then we committed to net zero. I think we have entered a pathway to work constructively with the administration, the EPA, our local publics, to accomplish this in the best way we know how. I fully appreciate your point of view that you could do it faster. We worked with Bryan. Where's Bryan again? There you go. We worked with the Biden administration. In fact, when he took office, I wrote him a letter committing that we would try to support the advancement of a net zero future. We were one of the first ones that said, if you may remember, we've committed to net zero by 2050.
There was this idea that somehow we could advance it to 2035. We didn't say no. We said, "Yes, and..." We think we can advance it, but we need the federal government in on the boat, in the boat with us in order to reduce the cost to customers. Remember, we must balance the qualities of clean, safe, reliable, and affordable. If all our objective was to reduce net zero fast and ignore affordable and ignore resilient. Well, that would be one thing, but that's not the world we live in. We must balance these things, and sometimes you make tough choices along the way. What we have right now, given the construct of tax law, environmental law, given the construct of environmental justice to our customers, we must make sure that the communities are not impaired as we travel down this tough road.
I think we've made the best choices. I fully appreciate your point of view. I just disagree with it.
Thank you. All right. Thank you, guys.
Thank you, sir.
Thank you very much.
Thanks for coming.
Laura?
Do you wanna go another one? I know we're very close to time.
Yeah, let's take one more.
All right, great. This is a... It says Georgia Power carbon capture. Interesting. Kimberly Scott.
Kimberly, where are you?
I think she... Oh, there she is. Hey, Kimberly.
Good morning. Again, my name is Kimberly Scott, and I am a Georgia Power customer. Thank you for having us today.
Bless you.
Thank you for your business.
Thank you. Also the Executive Director for Georgia WAND, stands for Women's Action for New Directions. We're an environmental social justice non-profit organization. We advocate for nuclear harm reduction, for our energy-burdened communities in the city of Atlanta, but also more importantly, our Southeast Georgia communities along the Savannah River, Savannah River Site, and where Plant Vogtle is located in Burke County, Waynesboro, Georgia. We've heard a lot of presentations about what Georgia Power's energy future looks like. Less coal, less emissions. Thank you for that. More natural gas and solar, possibly incorporating more technology, carbon capture. But what we have experienced as ratepayers, again, is not what has been presented.
Not to prolong the time, I do have a question about entertaining technology like carbon capture, which we know is not carbon-free. When Georgia Power is having issues and continue to have issues bringing reactors three and four in Waynesboro, Georgia, Burke County, online and working properly. What we've seen is that Georgia Power's disconnection rate is not public knowledge, but it's logical to infer that a rate increase will increase disconnections. We heard about the rate increases, the $14-$23, that the PSC, the Georgia Public Service Commission, just passed in regards to the IRA. We're looking at also another rate increase.
When we talk about retired seniors and the ability for them to weatherize their homes, they shouldn't have to use their retirement, they shouldn't have to use their pension or their Social Security to weatherize their home. The weatherization programs and the energy assistance programs for our most energy-burdened communities are limited in scope, and they fail to address the cost increases to customers. What we would like for you to consider is a broader scope, expansion and tax incentives for residential and small businesses to take advantage of this. More access to contractors. Contractors that can provide these services that will really provide clean energy jobs, businesses, and true realized savings to the shareholders.
Again, going back to my initial question, why are we entertaining new technology like carbon capture, when we can't even bring reactors 3 and 4 on board and working properly in a timely manner and not that we're passing on the cost of the construction and the materials to the ratepayers? Thank you.
Thank you. You wanna start?
Sure.
Yeah.
Carbon capture is fundamental to this nation's energy security going forward. One of the great advantages the U.S. has relative to any other country in the world in a globally competitive economic environment. Remember, I spent six years on the Fed, was chair of the Atlanta Fed for three years and chaired the conference of chairs, kind of the advisory board to the big Fed, and was there during the time of the changeover from Janet Yellen to Jay Powell. One of the things we're very conscious of is how do we maintain a strong economy? This idea of maintaining an energy, not independent, but certainly energy sufficient environment is so important for us. It gives us enormous advantages relative to China or other countries that don't have the economic interests of our nation at heart.
It's vital to the U.S. not to turn our back on some of those fuels, particularly natural gas. As we advance our portfolio from where it is today to a net zero future, we must, as a national security imperative, continue to use natural gas. We fully recognize that there are carbon emissions from natural gas. In order to maintain natural gas as an important input into this nation's energy future, we must find a way to deal with the carbon emissions. This company understands the importance of carbon capture technology. Again, not rhetoric, real solutions. We have led now for almost 20 years, the nation's Carbon Capture Research Center in partnership with the DOE. For a period of time, we also led the International Carbon Capture Research Center.
For Kemper County, we actually demonstrated a lot of that technology and successfully captured carbon off the synthesis gas that we produced there, and that was successful. Here's my point. We must have carbon capture as an important part of the arrows in the quiver of the future. If we're gonna keep natural gas in play in America, then we've gotta find a way to capture the carbon. I believe we can do that. When you look at our expansion plan, really in the 30s, folks, and kind of going into the 40s, we have an economic choice, and it is to continue with natural gas with carbon capture or to build new nuclear. Those kind of look like similar choices right now. As we approach the time to make the call on new technology, we will certainly make that choice.
That's what it looks like right now. Future for us, net zero is 50% renewables. By far, it's gonna be solar. 20% nuclear, 20% natural gas with carbon capture, and 10% other. Could be energy efficiency, could be hydrogen, it could be a whole variety of other things. We believe that direct capture, biomass or some hybrid approach to take carbon out for whatever emissions we remain could be in existence. I can't stress it enough. For the security of the U.S. , for the lowest cost, most plentiful supply of energy, we've gotta keep natural gas in play. I completely agree we've gotta deal with the carbon. That has to go together. If we can't, then the switch will go to nuclear. Okay?
2 points. Plant Vogtle, we're getting it done, and we're getting it done right. Unit 3 online in June, Unit 4 as early as the end of the year, no later than first quarter in 2024. We're getting it done. We are very sensitive to issues of affordability. You look at this last fuel case that Georgia just completed. Traditionally, we do the recovery over a two year period. We stretched it out to a three year period. Also, we increased the senior citizen discount. There will be other things that we'll do, that we know we have to do to limit the impact of increases on customers. We will take affordability very, very seriously. Work with you, work with others, work with the commission, making sure we're doing all the right things around energy efficiency. We will pay attention. We will focus on affordability.
Hey. One last thing. At the risk of geeking out on you, which I don't mean to do, but, Burleson, where are you? Burleson.
Well, I'm an engineer by trade...
Oh, great.
You can't geek out on me. Sorry.
There in the Inflation Reduction Act, which we supported, there are credits, 45Q credits. What does it get to? About $80 a ton?
$85 a ton.
Bam. $85 a ton. One of the things we loved about the IRA, it didn't start out this way, it ended up this way, and I think effective working on Washington Office, it was technology agnostic. What we tried to do was deploy the tax benefits across a broad range of things that give us the best chance of having these technologies come to bear at the time in which we need them. At $85 a ton for 45Q credits, that makes carbon capture in play. That's something we gotta do.
Thank you.
Thank you very much.
Thank you. Awesome stuff.
Guys, thank you very much. We appreciate your time. We will be outside after we conclude if you have other questions. Thank you very much. Thank you for being with us today, and let's go enjoy lunch.
Hey. Hey, I just wanna end it with thank you. For my time here, I have so enjoyed this forum with you all. You know, we always do wanna make the company better. We don't have the hubris that says we're as good as we can be. We can always be better, it's with your help, your engagement. I think we get that, we're moving the ball forward. Chris will do a fabulous job.
Thank you.
Thank you. Thank you for your time.
Thanks so much.