Good morning, and welcome to the Southern Company's 2024 Annual Meeting of Stockholders. I would now like to turn the meeting over to Schuyler Baehman, Vice President of Communications of Southern Company. Please go ahead.
Thank you, Francisco. Welcome, stockholders and guests, to our 2024 Annual Meeting of Stockholders. Let me remind everyone that we will make forward-looking statements today in addition to providing historical information. Various important factors could cause actual results to differ materially from those indicated in the forward-looking statements, including those discussed in our Form 10-K, Form 10-Q, and subsequent filings. In the unlikely event that today's meeting cannot be completed due to technical difficulties, please stay connected to the meeting website for at least 10 minutes. If the meeting cannot be resumed, please visit our website at southerncompany.com for information about reconvening the meeting. We refer you to the agenda and the rules of conduct for today's meeting. They are posted on the virtual meeting web portal at the bottom of your screen. At this time, I'll turn the meeting over to Chairman, President, and CEO, Chris Womack.
Schuyler, thank you very much. Good morning, and welcome everyone. We are excited to be hosting today's meeting, utilizing the latest technology to provide expanded access for stockholders, regardless of physical location. This format is designed to ensure that stockholders have the same rights and opportunities as they would during an in-person meeting. The order of the meeting, as noted in the agenda, will be as follows: first, we will conduct the formal business of the meeting, in which we will present the items being voted on today, address any stockholder questions specific to being voted on today, and provide preliminary voting results. I will then provide a business update, followed by a general question- and -answer period. I would now like to introduce the individuals who, along with me, have been nominated for election to the Southern Company Board of Directors.
All the nominees for Director are participating in today's meeting. Janaki Akella, former Digital Transformation Leader of Google. Hal Clark, retired Senior Advisor of Evercore. Shan Cooper, Founder and Chief Executive Officer of Journey Forward Strategies. Tony Earley, retired Chairman, President, and Chief Executive Officer of PG&E Corporation. David Grain, Chief Executive Officer and Managing Director of Grain Management. Don James, retired Chairman 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, Reese Endowed Professor in the Cockrell School of Engineering at the University of Texas at Austin, and former Commissioner and Chairman of the U.S. Nuclear Regulatory Commission. David Meador, retired Vice Chairman and Chief Administrative Officer of DTE Energy. Bill Smith, Chairman, President, and Chief Executive Officer of Capital City Bank Group.
Kristine Svinicki, Adjunct Professor, University of Michigan, and former Commissioner and Chairman of the U.S. Nuclear Regulatory Commission. And Lizanne Thomas, retired Partner of Jones Day. Ernest Moniz and Jenner Wood are both retiring from our Board of Directors. Their retirements are effective as of the conclusion of this meeting. I want to sincerely thank Ernest and Jenner for their dedication, commitment, leadership, and expertise they have provided to Southern Company. We are grateful and honored for their service, and they will remain friends and invaluable resources to us. Again, gentlemen, thank you very much. We will now move to the formal business portion of the meeting. The meeting is called to order, and the polls are now open. Most stockholders voted in advance of the meeting. If you have not already voted, you may submit your vote now through the Vote Here button on your screen.
As described in our proxy statement, stockholders were able to submit questions in advance of this meeting through the proxy voting portal. If you are a stockholder who wishes to submit a question but have not already done so, you may type your question in the Ask a Question field on your screen now. Deloitte & Touche has been appointed by the Audit Committee as the company's independent registered public accounting firm for 2024. Tim Gillam and Dan Glaser of Deloitte & Touche are participating in today's meeting. We offered them the opportunity to make a statement, but they have advised us in advance of this meeting that they do not wish to make a statement. The board has appointed Broadridge Financial Solutions to serve as independent Inspector of Elections for today's meeting.
Deborah Baker, on behalf of Broadridge, is participating in today's meeting as the independent inspector. Myra Bierria, Corporate Secretary of the company, has confirmed that approximately 926 million shares, representing at least 84% of the issued and outstanding common stock on March 25, the record date for this meeting, are represented in person or by proxy. We have a quorum necessary to conduct business. There are six items we are voting on today: four company proposals and two stockholder proposals. The first item is the election of 13 directors. The second item is an advisory vote on executive officer compensation, often referred to as say on pay. The third item is the ratification of the appointment of Deloitte & Touche LLP as the company's independent registered public accounting firm for 2024.
The fourth item is an amendment to the restated certificate of incorporation to reduce the supermajority vote requirement to a majority vote. The fifth and sixth items are stockholder proposals. The proponents for each proposal will have three minutes to present their proposal. For item five, the stockholder proposal regarding simple majority vote, Mr. Glenn Beatty will present the proposal. Operator, please open Mr. Beatty's phone line.
Can you hear me?
Yes, Mr. Beatty, we can hear you.
Thank you. Proposal 5, Simple Majority Vote. Shareholders request that the Board of Directors take the steps necessary so that each voting requirement in the 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. This includes making the necessary changes in plain English. Shareholders are willing to pay a premium for shares of companies that have excellent corporate governance. Super majority voting requirements have been found to be one of the 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.
Super majority requirements, like those at The Southern Company, can be used to block corporate governance improvements supported by most shareholders, but opposed by a status quo management. This proposal topic to improve the corporate governance of The Southern Company, won 66% support at the 2023 SO annual meeting as a Board of Directors proposal. However, the sadly outdated corporate governance of The Southern Company is hamstrung by, with the requirement that the 2023 proposal needed to receive 67% approval from all outstanding Southern Company shares. If improved, Southern Company corporate governance increases the market capitalization of, of Southern Company by 0.25%, it will result in a $187 million increase in market capitalization of The Southern Company.
If [The Southern Company] management had spent the lowest possible six-figure sum to encourage more Southern Company shareholders to vote in 2023 in order to obtain the required 67% approval from all Southern Company shares outstanding, it would have resulted in an astounding $1,870 return for each $1 invested. Mr. Anthony Earley, Chair of the Southern Company Governance Committee, deserves resounding against votes in 2024 for missing this 2023 opportunity. This Proposal 5 has already been successful in moving The Southern Company Board of Directors to put Proposal 4 on the ballot today on the same topic as this Proposal 5. It is entirely consistent for Southern Company shareholders to vote for Proposal 4 and Proposal 5.
This Proposal 5 is a backup proposal for Proposal 4 in case Proposal 4 is not approved. The Southern Company Board of Directors should thus be in favor of shareholder approval for both proposals today on this same important topic. Please vote yes on Proposal 5.
Thank you, Mr. Beatty. After careful consideration, the board has recommended a vote against the proposal. You can read the board statement and response beginning on page 97 of the proxy statement. For item six, the stockholder proposal regarding disclosing short, medium, and long-term operational GHG targets, Mr. Christopher Richardson with Mercy Investment Services, is presenting the proposal. Mr. Richardson pre-recorded his presentation. Operator, please play Mr. Richardson's presentation.
Good morning. My name is Christopher Richardson with Mercy Investment Services. Today, I'm here to discuss a critical opportunity for The Southern Company to lead in climate action through proposal number 6 on your proxy ballot. Our resolution calls for The Southern Company to establish and disclose short, medium, and long-term operational GHG targets that are truly aligned with the Paris Agreement's goal of limiting global warming to 1.5 degrees. Despite Southern's progress in decarbonization, our analysis, supported by scientific consensus and independent benchmarks, shows that Southern's current targets fall short of what is needed to meet these international climate goals. The current lack of alignment not only risks Southern's reputation as a forward-thinking company, but also exposes it to increased regulatory, financial, and operational risks that global climate policies tighten.
Peers such as Xcel Energy and NextEra are setting aggressive targets, reducing their risk profiles, and capitalizing on the incentives for renewable energy, demonstrating the financial advantages of stronger climate commitments. Our proposal does not prescribe how Southern should meet these targets. Instead, it offers the flexibility to innovate and adapt, allowing Southern to utilize the best available technologies and strategies. This approach is not just about reducing emissions, it's about positioning Southern at the forefront of the energy sector's transformation. Investing in renewable and low carbon technologies not only aligns with global climate goals, but also sets up new avenues for growth and revenue. It ensures compliance with future regulations and aligns with the increasing demand from consumers and investors for responsible and sustainable business practices.
By aligning with the 1.5 degrees Celsius pathway, Southern stands to benefit from enhanced investor confidence and risk mitigation, which are crucial for long-term sustainability and profitability. I urge all shareholders to vote for proposal number 6. It's a vote for transparency, accountability, strategic foresight, and a sustainable financial future. Thank you for your attention and support.
Thank you, Mr. Richardson, for your presentation. After careful consideration, the board has recommended a vote against the proposal. You can read the board's statement and response beginning on page 99 of the proxy statement. I have been advised that there are no stockholder questions specific to the items up for vote. As a reminder, the general stockholder question- and- answer period will occur after the business update. We have finished the presentation of the six items up for vote at today's meeting, and the polls are now closed. I will provide a preliminary voting report that reflects the votes submitted prior to this meeting. For item one, all 13 nominees for Director have been elected, with each Director receiving at least 95% of votes in favor. For item two, the say on pay vote has been approved, receiving 95% of votes in favor.
For item three, the appointment of Deloitte & Touche as the company's independent registered public accounting firm for 2024 has been ratified, receiving 97% of votes in favor. For item four, the amendment to the restated certificate of incorporation to reduce the supermajority vote requirement to a majority vote has not been approved, receiving 66.5% of the issued and outstanding shares in favor. The shares that were voted were overwhelmingly positive, over 98% for the amendment, but not enough votes were cast on this item as of the preliminary voting report to reach the requirement of 67 % of the issued and outstanding shares required to amend our certificate of incorporation. For item five, the stockholder proposal regarding simple majority vote has not been approved, receiving 40% of votes in favor.
For item six, the stockholder proposal regarding disclosing short, medium, and long-term operational GHG targets has not been approved, receiving 9% of votes in favor. The shares represented by votes submitted during this meeting will be included in the final vote report, which will be filed with the SEC in the next few days. With that, the formal business portion of the 2024 Annual Meeting of Stockholders is hereby adjourned. Now, I have the pleasure to provide an update on the state of your company. Southern Company experienced an exceptional year in 2023. We reached new heights through excelling at the fundamentals, serving customers, elevating our communities, and leading through innovation.
Despite financial headwinds that included higher interest rates and inflation and historically mild weather to begin the year, the company delivered on our commitments as we continued our superior performance across all facets of our business by keeping the customers and communities we serve at the center of everything we do. The successful completion of Plant Vogtle Unit 3 in July, the first newly constructed nuclear unit in the U.S. in more than 30 years, marked a historic milestone for the United States. On April 29th of this year, Unit 4 successfully achieved commercial operation. With all four units now operational, Plant Vogtle is the largest generator of clean energy in the United States. I could not be prouder of the perseverance and the commitment this company demonstrated as we proved that new nuclear is achievable in the United States.
Along with our own team, success on this important project required the hard work and dedication of tens of thousands of American craft workers and engineers, as well as a committed group of co-owners, government partners, and regulators who had the courage to support new nuclear when others did not. In addition to the new nuclear units at Plant Vogtle in 2023, we successfully completed construction of a brand new combined cycle plant, Plant Barry Unit 8, constructed on time and within budget, is now serving customers across the state of Alabama. Our regulated electric utilities invested over $3 billion in transmission and distribution infrastructure across Mississippi, Alabama, and Georgia in 2023, helping ensure delivery of clean, safe, reliable, and affordable energy to customers.
Our natural gas businesses performed well during the year also, with ongoing infrastructure investment supporting the safety and reliability of our systems. We expanded our system to serve new customers and continued to score highly in the area of customer satisfaction and customer care. In 2023, nearly 1/3 of our electricity came from clean energy sources. Additionally, Southern Power acquired two solar facilities, expanding its renewable fleet to over 5,000 MW across the U.S. Strategic initiatives to reduce our environmental impact resulted in a 49% reduction of our GHG emissions compared to our 2007 baseline. Southern Company's future is bright, and we are optimistic for the future growth and development across our service territory.
Projected retail electric sales growth for the system has accelerated to about 6% from 2025 to 2028, driven today primarily by strong projected growth in Georgia. Looking ahead, we're encouraged to see signs of potential incremental growth also in Alabama and Mississippi. Growing energy needs across our territories continues to be driven by robust economic development across our states, and we are proud to partner with our states to grow the communities we are privileged to serve. As we work to serve these growing energy needs, our system-wide integrated resource planning process supports the addition of a balanced mix of generation resources over the next several years and projects a significant increase in renewable resources over the next decade.
In fact, over 80% of the resource additions planned across our system, totaling nearly 10,000 MW from 2023 - 2030, are zero carbon-emitting resources. There will be power. As we invest across our system to serve our economy and society, Southern Company's focus remains on providing clean, safe, reliable, and affordable energy for all of our customers. Affordable electricity and natural gas improve the quality of life, the quality and life of customers, and is the foundation for a healthy, growing economy. It is our objective to ensure customers and communities continue thriving, and that new customer demands don't place additional burdens on those less able to afford it.
Our balanced and intentional approach strives to support economic and population growth in a way that still moves us to decarbonize and a cleaner energy future, and in a way that maintains reliability and affordability for our customers. This balanced approach also includes our continued focus on achieving our long-term GHG reduction goals. Working closely with each of our states, we continue to make responsible, economical resource decisions over the long term. Southern Company has been recognized as an industry leader, ranking number one among electric and gas utilities in Fortune magazine's World's Most Admired Companies. This reflects our commitment to service, innovation, and community growth, supported by the investment in our people. In closing, we accomplished some wonderful things in 2023, and we are even more excited about our future.
We have seven quality state-regulated utilities with long track records of outstanding operational and financial performance, paired with a group of quality complementary businesses. We believe we have the ideal portfolio to support our long-term objectives. An important part of our value proposition is a remarkable track record of our dividend. The Southern Company Board of Directors recently approved an $0.08 per share increase in our annual common dividend. This action marks our 23rd consecutive annual increase, and this will now be 77 consecutive years. Dating back to 1948, Southern Company has paid a dividend that is equal to or greater than the previous year. Southern Company's value proposition has never been more attractive. Southern Company is a great company. Our team has never been stronger. We are positioned as well as we ever have been.
We have the people, we have the experience, and we have the scale for sustained long-term success, and our customer-focused business model continues to be the cornerstone of our value proposition. As always, thank you for your interest in Southern Company.
Thank you, Chris. We will now respond to your questions. We will try to answer all stockholder questions subject to time constraints. As noted in our proxy statement and the rules of conduct, questions from multiple stockholders on the same topic or that are otherwise related, may be grouped, summarized, and answered together. Our first question comes from a shareholder who has joined us for many years. Their question is: Having heard the Volts.wtf podcast,... entitled Nuclear? Perhaps! featuring Jigar Shah, a successful solar entrepreneur, and now head of the DOE's Loan Programs Office . I now see the wisdom of Vogtle 3 and 4, and applaud the company for working through the numerous challenges, the Westinghouse bankruptcy, pandemic, et cetera, to see them to completion and restoring America's nuclear technology in a globally competitive field.
What started as a hedge against volatile gas and coal prices, these plants will lead us into a carbon-constrained world, stabilizing the climate along with renewables, storage, and deep efficiency. As Mr. Shah points out, we will get the cost of the next reactors down due to the learnings of Vogtle Units 3 and 4. As the planet warms, we'll be increasingly glad for the effort our company put into this endeavor. So thank you. My question is in two parts: How do you communicate the various safety features built into these reactors? And two, what is the future of, quote, "closing the spent fuel loop with advanced nuclear designs?
Thank you for your question. I'm excited to have the opportunity to speak to you about Vogtle Unit 3 and 4. You are certainly correct to point out that these new nuclear units not only are the first built in the U.S. in more than 30 years, but they are, in fact, the first in this country to use the new advanced AP1000 design. You know, these units feature a suite of additional safety features as compared to traditional nuclear power plants. These features require no operator interaction in the unlikely event of an emergency, and the most visible example is the 750,000-gallon tank of water that's located on top of the AP1000 containment and shield building, that's there in case additional water is needed for cooling purposes.
There's enormous interest in these units from across the world, from around the world. A few weeks ago, we hosted the President of Poland at the site. I mean, they're seeking to enhance his own country's energy security by building AP1000 units. Going forward, we'll continue to highlight the, the enhanced safety measures and the performance of Vogtle Units 3 and 4. To your second question, I mean, I think there are many potential developments being pursued as part of the growing industry involvement in advanced reactor designs. I mean, I think the potential for a new design that could use reprocess or recycled spent fuel is just one example of the positive developments advanced reactors may bring. We continue to invest in R&D at this company and across the industry, and we'll continue to participate with the industry related to advanced reactors.
We are optimistic that the industry will make progress in this area. And lastly, let me say, in addition, we're committed to advancing nuclear fuel technologies that increase the fuel efficiency and reduce the number of fuel assemblies to store long-term. Our team members at Southern Nuclear are nationally recognized by the Nuclear Energy Institute for top innovative practices in the advancement of nuclear fuel technology, and we'll continue to pursue new technologies as we go forward. Schuyler, are there any additional questions?
Yes. Our next question comes from a stockholder who noted that he has attended a number of past annual meetings and is asking about Southern Company's perspective on the current technology for methane leak detection. Asking what Southern Company has done to reduce methane emissions and whether Southern Company will consider including Scope 3 emissions in our decarbonization goals. The stockholder specifically inquired about satellite-based tools for methane detection.
Thank you for that question. There are a few components that make up that question, so let me take a few minutes to address them separately. Southern Company has, and we've said this many times, we don't have direct control over Scope 3 emissions. At the same time, and however, we are employing a deliberate and very disciplined approach to reduce Scope 3 emissions by focusing on upstream as well as downstream solutions. And that includes things like seeking natural gas that has been certified to be produced with lower methane emissions, expanding our residential energy efficiency programs to include all of our natural gas local distribution companies, engaging in a wide range of hydrogen opportunities, and supporting efforts like GTI Energy's Veritas program to promote direct measurement, monitoring, and verification of methane emissions.
As to new technology for methane leak detection, including satellite-based tools, we're evaluating the ability of technologies like satellites to accurately provide methane leak data that can help inform participants across the value chain. We're implementing advanced leak detection technology today in our gas distribution business. As to including Scope 3 emissions in our net zero goals, you know, we agree that there have been tremendous improvements related to methane leak detection and measurement. We still do not have a Scope 3 goal because of the challenges around measurement, methodologies, and protocols related to emissions reporting. We cannot speak to the plans of our peer utilities, but it makes little sense to us at Southern Company to set specific targets and deadlines without standardized measurements and protocols.
We believe Southern Company and Southern Company Gas are industry leaders in driving down emissions across the value chain and providing transparent disclosure. If and when a Scope 3 goal makes sense, we will certainly set one that is in the best interest of our customers as well as our communities. Schuyler, do you have any more questions?
Yeah, we have a question from a stockholder who has asked: Will Southern Company consider proposing to its public service commissions, modernizing regulatory incentives to make energy efficiency an equally profitable choice for utilities while lowering consumer rates?
Yeah, and I'm very excited to respond to this question. Southern Company recognizes the value of demand-side options and supply-side options, both on an equal basis in our resource plans, and we believe that our integrated resource planning process will result in the best overall system for our customers. Demand-side options will include, and have for many years, for decades now, energy efficiency, demand response, distributed energy resources, and virtual power plants. You know, for more than 30 years, our operating companies have worked with regulators in our jurisdictions. They serve to deliver demand-side solutions, such as energy efficiency, that save customers money, and demand response that recognizes the value of customers being able to actively adjust their energy needs. These solutions save participating customers money and provide benefits to all customers, and we will continue to pursue such solutions.
As a company, and with our customer-focused business model, we have a duty to help customers use energy more efficiently, and our current planning processes and regulatory mechanisms will provide adequate incentives to develop demand-side and supply-side resources in the future. By evaluating demand-side options on an equal basis with supply-side resources, we're able to deliver a robust portfolio of resources that will continue to provide clean, safe, reliable, and affordable energy to all of our customers now and into the future. Schuyler, any more?
Yeah. Our next question come from the topic of residential solar. A stockholder has asked: Will Southern Company purchase the excess power generated by solar installations on homes and businesses at fair price? Will Southern Company encourage its operating companies to embrace a retail minus approach to solar that is returned to the grid rather than an avoided cost plus approach? The minus would be a fairly calculated cost of transmission and generation deducted from retail cost that would float with rate change.
A very, very good question, and a question that we talk about a lot inside the company. Let me walk through it. Our current practice of recognizing avoided cost value of solar generation, plus any policy and incentives granted in each jurisdiction, fully recognizes the value of solar generation and helps ensure that customer-sited solar generation provides benefits to all customers. Let me talk about the avoided cost plus approach. This approach starts with the actual cost that the company will avoid building or expanding, and allows the commissions, based on each jurisdiction, to add any additional policy incentives that they deem to be appropriate.
We believe the retail rates, minus generation and transmission approach, over-incentivizes solar production at the expense of customers who do not own solar, and eliminates the ability of commissions to develop policy incentives appropriate for each jurisdiction. The avoided cost plus approach represents the actual cost avoided by the company in the service of our customers, and helps ensure that the benefits of solar are realized by all customers. This approach aligns well with the established practice of each jurisdiction of our operating company serve, and provides regulatory flexibility to each commission as they seek to meet the needs of their specific states. Schuyler, are there more?
Yes. In fact, several stockholders have asked a question about increasing the amount of carbon-free generation for Georgia Power customers. These stockholders are concerned about the energy needs from the projected load growth in the state, and are asking why Southern Company is not giving a higher priority to investments in additional renewable energy and storage, as well as supporting the expansion of distributing energy resources.
Yes, Schuyler, thanks for that question, and let me kind of try to set the record straight. I mean, as I mentioned in my earlier remarks, I mean, as we serve these projected energy needs, we remain focused on achieving our long-term greenhouse gas reduction goals, which includes net zero greenhouse gas emissions by 2050. Also, as I spoke earlier, over 80% of our resource additions planned across our system from 2023- 2030 are zero carbon-emitting resources. Our planning process considers a host of factors, including affordability, reliability, safety, environmental impacts, and resiliency, as well as broader social and economic community impacts as we make generation decisions. We will continue to use this approach, one that places priority on the customers and communities we serve as we work to decarbonize in the decades ahead.
Schuyler, next question.
Yeah, our next question comes from a stockholder who asks why Hyundai, at the Bryan County, Georgia, facility, is using Texas solar power REC rather than using Georgia Direct Solar from Georgia Power?
Well, first of all, we're excited to have Hyundai as a customer for us in Georgia, and thrilled by all the economic activity that they're bringing to Bryan County and to that whole area around Savannah. Now, I can't speak to Hyundai's overall strategy or questions related to their specific contractual arrangements. However, as I said, you know, we're honored to serve Hyundai, and we're excited about to be the energy provider for the historic Metap lant. Beyond that, we can address a couple of themes of your question. Georgia continues to grow and has been recognized as the number one state in which to do business. We believe access to clean, safe, reliable, and affordable energy is a key driver of that growth, and we are proud of the role that we play.
It's common across the industry for large national or international customers to meet their renewable energy needs through a combination of programs and procurements, including the purchase of renewable energy credits, which we call RECs, from other regions and other sources. Georgia Power has worked closely with regulators to develop flexible, effective programs that can help businesses of all sizes meet their operational as well as renewable and clean energy goals, while also helping keep energy reliable and affordable for all of its customers. Schuyler?
Great. Our next question, we actually received two stockholder questions asking about stock splits. Asking about the company's guidelines in considering a stock split and whether one is likely in the not-too-distant future.
It's a very interesting question. We are not currently expecting to undertake a stock split. You know, a stock split reduces the per share price of a share of a common stock, but it does not change the overall market capitalization of the company. There are also some administrative costs to a stock split that would need to be considered. You know, at some point, we might consider a stock split if our stock price gets so high as compared to peer companies, that it deters investors and negatively impacts liquidity. In looking at our current stock price, which is about, I guess, close to $80 today, I'm not sure. I hadn't seen where the market was trading today.
The liquidity of our stock and our investor base, which still has about 35% retail holders, we believe that our stock remains fairly accessible for our investors and that our stock has sufficient liquidity. We will continue to monitor these factors in the future, and of course, any decision of this nature is under the purview of the Board of Directors and would require their full consideration and approval. Schuyler, anything more?
Yeah, we had some questions regarding customer service generally and some specifically. One stockholder asked about our efforts to improve customer service, including our builder hotline.
Okay, that's an interesting question. I mean, as I said before, and we say it all the time, we place customers at the center of everything that we do as we deploy and support the beliefs of our circle of life. We are always dedicated to delivering reliable and affordable energy to our customers and our community. Continuous efforts are made to improve customer service at every turn. I mean, we'll leverage our workforce planning. We'll look at skill development programs, and we're always looking at technology solutions to meet and exceed customers' expectations. One such technology solution that we're deploying is Builders Connect, a customer-facing portal designed to streamline the service order process for new construction. It also enhances the customer service experience for builders.
Upon completion, Builders Connect will streamline the process for new construction, including self-service and near real-time updates. It will reduce the effort needed for builders to access updates for their projects and enhance operational efficiencies for the company. We appreciate the feedback, and we'll continue to seek innovative solutions to meet the needs of our customers.
Our next question is regarding equity compensation. Well, we had a stockholder who asked: Why do we give shares to executives and directors? Why don't we pay them and allow them to purchase shares at a reduced rate, perhaps 75% or 85% of the current price, and require them to hold the shares for a specified period of time, depending on the discount? Giving away shares that are created for such use diminishes the equity and voting power of each shareholder. All shares used for such purposes should be purchased by the company on the open market.
Very interesting question. At our board, our Compensation and Talent Development Committee, which is comprised of our independent directors, establishes the compensation structure for executive officers. In looking at this compensation structure, the Board of Directors considers looking at competitive market information, along with what are the best design practices in the market, in determining what the equity compensation plans, what they should be, how they should pay out, and what the structure should be. Buying shares in the open market does not provide adequate upside or downside in pay outcomes for executives when placing pay at risk. Executive equity plans typically have a 0%-200% performance component to ensure we align executive management with shareholder interests. Getting this alignment right helps ensure we drive shareholder returns, and we also attract and motivate the best talent to run our business.
Equity compensation comprises only a very small portion of our overall outstanding shares and has a minimal dilutive effect. Finally, equity compensation is a cost-effective way to manage cash flow and preserve capital, as it does not require an immediate cash outlay. Schuyler, what's next?
Next, we're questions about the Georgia Power IRP update and our net zero goals. One question asked: Georgia Power's new IRP plan included three new gas turbines at Plant Yates in Georgia. Since the new turbines are designed for a 40-year life, this locks in fossil fuels past the 2050 goal that Southern Company has set. How will the company meet the 2050 goal of being net zero if it builds new fossil fuel plants with 40-year lifespans? Does the company expect to use carbon sequestration, which is still prohibitively costly?
Then another question that we got just a few minutes ago during the meeting asked: Southern Company claims it has a commitment to achieving zero carbon emissions by 2050, but how can shareholders have confidence in the company if methane gas seems to be the main form of energy production that is being immediately expanded upon, as seen in the IRP update for Georgia Power?
Let me touch on all those questions. And thank you for the questions. You know, we work very closely and very constructively with each of our states, and we have made what I think is significant progress in reducing the emission profile of our generation fleet. I mean, I'll say again, and when we say this often, we're fully committed to our greenhouse gas reduction goals and our commitment to net zero by 2050. We continue to believe natural gas will be a part of our generating fleet, and it will help us get to net zero, and we remain focused on solutions that can support methane reduction across the value chain. We believe that working constructively with our regulators helps reduce the risk of stranded assets.
We believe no company has done more to research carbon capture and sequestration than Southern Company. You know, we've been working with DOE now, and we've managed and operated the National Carbon Capture Center for more than 15 years, we have, I think, achieved and accomplished some 150,000 testing hours. We're excited by the science of carbon capture and sequestration and see it as a positive for our industry and our company in the long- term. At this time, however, concerns remain over its economic viability as a near-term solution.
The next question is regarding the company's political spending. We've had several stockholders ask a question about our political expenditures and how generally, how we participate in the political process.
Thank you for that question. We believe we have a responsibility to our stakeholder, all of our stakeholders, to participate in the political process. We've built a reputation for serving as a trusted source of helpful information and effective advocates for our customers, our stockholders, and other stakeholders before Congress, state legislators, local governments, and federal and state regulatory agencies. Our companies have put in place decision-making and oversight processes to promote and ensure compliance with applicable laws and regulations in alignment with our business strategies and priorities. Corporate political contributions and expenditures made by Southern Company and its subsidiaries are reviewed annually, at least annually, by our Nominating, Governance, and Corporate Responsibility Committee, which is comprised of our independent directors. We have a section on our investor relations website describing our policy engagement and advocacy that includes an overview of our policies and practices for political engagement.
The website also includes a report updated annually, disclosing our political engagement expenditures. I'm proud that Southern Company has earned top marks from the CPA-Zicklin Index of Corporate Political Disclosure and Accountability, a nonpartisan scorecard that measures electoral spending, transparency, and accountability among the largest U.S. public corporations.
Chris, we just had a question come in asking a little bit more about what we talked about in the script. Asking about the risks, challenges, and adverse effects of data centers and their need for massive amounts of electricity. Specifically, they mentioned Fayette County, Georgia. Just so, just, I guess, just to reiterate data centers and what the future looks like and their energy needs.
No, I mean, we are, as we said before, I mean, we are excited about the overall growth, economic development activity that we see occurring all across our territory. And our goal is to ensure that customers and communities continue to thrive, and that the new customers and demands don't place additional burdens on those less able to afford it. I mean, we're working through our orderly processes, our integrated planning processes, which provides a balanced approach and mutual benefits for all of our customers. We feel good about where we are, we feel good about the future, and we feel good about how we'll respond to and meet this demand as we go forward in a very, very balanced approach that meets the needs of all of our customers.
It's an exciting time in our territory, with this growth and activity. It's very positive, and it supports this bright future that I've talked about.
Great. Chris, we're nearing the end of our allotted time. We still have a few stockholder questions that we have not been able to address.
So if we've not been able to respond to your questions or your topic, we will respond to you directly via email. And I think if there are some questions that come in after us, we will post them on our website. So we will make sure that we respond to each question that you have. So with that, again, thanks, everybody, for your participation and for joining us today. In closing, let me say, as Memorial Day approaches, I want all of us to take a moment to remember and honor the brave men and women who have made the ultimate sacrifice in the service to our nation. I encourage each of you in the coming days to reflect on their legacy and how you will honor the values they fought to protect. Thank you for your time today.
Thank you for your continued support of Southern Company. Be safe, take care of yourselves, and take care of each other. Have a good rest of the day. Thank you very much. That concludes our meeting.
Meeting is now concluded. Thank you for joining. You may now disconnect.