hello my name is frzy Hughes CEO of gleo I'm really pleased to introduce another episode in our series of investor CEO interviews today Question Master will be Rodney Clayton of Duff and Phelps Investment Management from Chicago and Rodney will be interviewing Chris wmer who is president and CEO of Southern Company who are headquartered in Atlanta and also the second largest regulated utility in the Ft Wilshire Glo Global listed infrastructure index guys over to you thanks Frasier and thanks to gleo for everything you do for the infrastructure sector and the investment Community Chris it's great to be with you today R it's always a pleasure to see you hope you're doing well in Chicago absolutely same to you uh maybe we could start off with uh if you could just give an introduction to Southern Company maybe for those that are not as familiar as you know we're one of the largest utility holding companies in the in the US and with a deep focus on Clean safe reliable and affordable power to all of our customers and we operate some three electric uh vertically integrated uh regulated businesses here in the Southeast but also we have four uh ldcs across the country as well Gas Distribution businesses with a deep focus on on customer service we have some 9 million customers across Ross those businesses with a real strong focus on customer service customer satisfaction high quality customer delivery also with a real deep focus on operational excellence and operational performance and we're also fortunate uh and it's a real deep commitment of ours as well uh this focus on making sure we have these wonderful constructive regulatory environments which which serve us well and so that's kind of who we are um we've got a 48 billion fiveyear Capital plan which really supports our focus on being this sustainable regular predictable delivery of earnings which also feeds into our our five to seven perc growth rate uh on earnings and so all that comes together uh with supporting this strong balance sheet that we have that I think really uh probably one of the best in the industry if not the best uh which helps us uh through no matter what the time is may look like uh this real solid balance sheet and then lastly I I also have to speak to our our our dividend philosophy and kind of where we've been and kind of where we are uh we provided a dividend uh for the last 77 years add or greater than the previous year and for the past 23 years uh We've increased our dividends and so I think it's incredibly remark remarkable performance on on the part of this company and it speaks to kind of where we are and the value proposition that that we offer so just a lot of good things going on here at Southern Company that's great maybe let's start with demand growth you know Southern is seeing tremendous demand growth at this point for power you know particularly in Georgia but it seems to now also be spreading out to some of your other territories what's really driving that demand growth that you're seeing in your territory yeah R you're right mean we're seeing tremendous economic activity uh we've always been very strong and and started actually some of the early Economic Development departments uh here at Georgia power and and and and at Alabama power so this has been a a real focus of ours for a large part of the history of this company right now we're seeing unprecedented economic activity across our businesses uh we've seen it in Georgia uh we continue to see activity strong activity in Alabama as well as Mississippi uh if you look at uh Georgia Power filed an updated RP uh last fall and they got a resolution on that here in the springtime of this year really focused on uh this new growth a large portion of that is in fact data centers but it's also manufacturing uh Hyundai electric vehicle uh infrastructure facility down around some Savannah uh you see incredible expansion by Gulf Stream down in the savannah area as well additional activities around the port in Savannah Port of mobile uh meta recently made an announcement of a project in Alabama so just a lot of solid growth that we see all across our territory that's that's really exciting and it's what we say it's incredibly unprecedent great you know a key question in your recent IRP filing in Georgia which you just alluded to was the level of confidence that that demand is actually going to show up you know how do you get confident that you aren't overestimating the opportunity that's that's in front of you today yeah once again I I think the experiences that we have of of working through these kind of projects before I mean and and just going back to the growth you know we we've been seeing uh somewhere something right around one one and a half% growth with this activity that we're seeing now we're looking out into the latter part of this decade growth across on average across our entire system of around 6% but in Georgia around 9% but as we look at these projects uh there's an incredible uh diligence process that I mean companies are always looking at different locations in different states and so we factored that in but we take them through a funnel of process of them making decisions about Lo locations them making decisions about suppliers of energy and then the those requests for services if you look at kind of the the filing at Georgia uh last year with the request we saw a demand increase of about 6600 megawatts I mean and that that capacity has been fully subscribed and and we're seeing even more but we work to make sure that we kind of do a a full-fledged risk mitigation process to make sure that we're pretty certain about these projects that are forthcoming and that they are in fact real and so feel good about the rigor that we put into that process and making sure that you know we're not just chasing customers that that may not show up and move somewhere else so feel real good about our process to make sure that we know that these projects these customer are real and they are in fact coming to our territory all right those are impressive numbers for sure you know some investors might question whether all this data center demand growth is is healthy uh for the utilities you know they'll say you know it's not going to materially impact earnings on one hand and you know it doesn't you know have good secondary impacts for example leading to significant population growth what would you say to those investors those people who have this view I mean Ry I have to tell you being for a utility company to have customers that want electricity 247 all the time it's a wonderful way to to to to to have this demand that is constant and thus you have the opportunity to to to spread these kilowatts across this this large base and thus also as you price these projects you have the opportunity we make sure we understand what marginal costs look like and doing all that that analysis to make sure that as we operate our system as we price this load uh we have these customers that we understand what their costs are and we charge them uh for that cost and so thus we don't have to spread that across the entire system the entire base so these customers provide a wonderful benefit a wonderful utilization of the resources of our system and providing services to them but also providing benefit and value to the entire system so it's a it's a mutual beneficial opportunity with these data center customers with their kind of port with their how they what their needs are as we look at what the utilization uh process and their rates look like uh it's just uh mutually beneficial for them but also uh to the rest of the customers on our system system so good points you know for an investor uh in in the utility sector regulatory relationships are very critical and you know that's one thing that southern is really known for is having extremely strong relationship with with Regulators across multiple jurisdictions you know would love for you to talk about how you've been able to achieve that and and maintain that over the years and and Rodney that also goes back to this deep commment that I that I refer to very often and it starts with the focus on customers and that high quality uh level of service that you provide customers and we use language and we believe it that customers at the center of everything that we do and if we we stay focused on on that priority from a service standpoint from an operational standpoint uh if we do that from a pricing standpoint if we do that on an ongoing regular basis that's what I think is fundamental in terms of maintaining this constructive regulatory environment all across all of our territories and we feel real good about that I think the other thing that we have to make sure that we continue to do is be a a good citizen be a good corporate citizen in the communities where we are privileged to serve and operate and so the Deep Roots that we have with the members of our team of our companies leading a lot of community Endeavors doing things to make the communities better uh making those kinds of Investments I think those things go hand in hand because that's what our Regulators expect from us and want us to see the Deep commitment we have to making our communities better the leadership roles we play on economic development and so across the board our employees are there I mean their leaders in in every aspect of these communities and so I think when you add all that up in terms terms of the service we provide and the quality service we provide to our customers with this community investment um making the helping the communities grow uh helping the school systems be better I think all those things kind of feed into making sure that we have this constructive wonderful positive uh regulatory relationship uh with with our regulators and it it serves us well and it it serves the regulators and the commissions well also I mean so once again I mean it's uh kind of who we are what we have been doing for for for decades and things that we continue to do even in the in the period of this kind of the dynamic Evolution and changes that we're seeing with this incredibly unprecedented demand uh we still have to make sure that the customers are at the center of everything that we do and if we do that uh this kind of model that we have relationships that we have I think will continue to serve all of us very well all right great uh let's talk about nuclear uh you know you recently brought on America's first two nuclear units in you know about 30 years which is extremely impressive uh you know you've been vocal about how America really shouldn't let another 30 years go by without building know new nuclear units why why do you think that's so important for the country and and then what can be done to facilitate a cycle of new bills across the industry right you always have to start out with I mean it's a it's an incredibly proud moment for us for for Southern Company to bring these two units online yeah it's been it was an arduous journey and we know that but to to demonstrate that we as a company can do hard things that our employees can do and and and solve difficult complex challenges I think is just a great great contribution for this company and kind of demonstrates kind of who we are and the things that we are committed to do I mean when you look at this demand that we see across the country and the the demand we see in our territory we always say there's got to be a diverse mix of resources available to meet this growing demand I do think uh that nuclear has got to be a part of that mix and this country should not wait another 30 years to to build another nuclear plant and so I mean yeah I I I talk a lot about what needs to happen going forward to making sure that in partnership with the government there are incentives there are understandings of what risks need to be mitigated uh in terms of cost overrun Insurance some upfront incentives loan guarantees a lot of things that were part of our project at plant vogo but making sure these things are being done and making sure that we're creating the momentum uh to to make this a reality and not just having oneoff projects but we're having projects all across the country whether it's uh 10 new projects of ap1000 also investments in in advanced nuclear uh small module reactors uh I think this country has got to make this kind of commitment and and the government has got to be a great partner to to give this momentum started and keep it going and making sure that we have the work for us making sure we have the supply chain making sure we have H have the labor force the skill labor force we need to make this a reality all across the country and so I'm excited about it and I'm going to keep talking about it keep working with policy makers all across the country uh to hopefully keep this going build on the momentum of vogo 3 and four and continue this effort and and see more projects get started and come online in this country in the future I I think it's I think it's very very important I I mean I say a lot I mean the energy security of this country supports our national security uh but also feeds in and is very critical to the economic security of this country and we've got to make sure that this country continues to have the energy resources that it needs and I think it must be diverse but nuclear's got to be a real big part of it indeed um you know Southern investors right now we awaiting a an updated Capital plan from you following your you know uh IRP updated uh approval in Georgia recently you know your existing plan included a minimal amount of of new Equity issuance maybe if you could talk just a little bit about what your general approach is uh to funding all of your growth and and and also managing your balance sheet overall yeah and like I said like I said earlier I mean I I think if if we don't have the best I think you know we're we're right at the top in terms of the quality of our balance sheet and look on the credit side but also on the equity side and you we know we have some Equity needs we have to issue about 350 million uh and then we have the opportunity to turn on our our internal plans our our ATM opportunities are available to us and so I mean that's what we'll do I mean so once again I think we have the strength we have the C capacity uh to do this to meet our needs to support uh we increased our our capital budget to 48 billion dollars for the next five years which feeds into our earnings trajectory and so once again having the the the cash coming in cash flow coming in after the vocal projects went online puts us in just a very strong position going forward and so I think we have a solid plan going forward and we'll continue to build that out as we move into the future okay uh final question uh 2025 Big Year in Georgia for you you've got a raid case upcoming and that's your regular IRP cycle year so just talk maybe a little bit about what your outlook is going into such an important year for southern no it it really is and the thing that I'm excited about with Southern Company is that and we have these orderly processes that I feel good that will help us make sure we respond to the near-term needs that we see but also put us in a place to to deal with the the ongoing longer term demands that we see forthcoming and that's what's afforded to us in this integrated resource plan that Georgia will file in January and we'll get a decision sometime in July and then subsequently coming behind that there will be a a the tri anual rate case that Georgia has every three years in terms of funding and paying for uh these these investment opportunities and so clearly we'll see uh increased demand that's reflected in announcements that we see and that that that we know about uh beyond what we filed and got approved in this updated plan here earlier this in April I mean so I think it's it's more to come uh but I think the the good thing about it and and and what we have the opportunity to show is the ordering process the nature in terms of how we will deal with this unprecedented growth and and the opportunities that it presents for our company into the future and all of this just feeds into our ability I think to to lengthen and strengthen and deepen this the value proposition that we offer as a company in terms of the solid earnings opportunities and the growth that we have in front of us uh it just I think extends the opportunity and and and the value proposition uh that we bring to the market great uh Chris any final remarks no Rodney I just got to say me it's it's an exciting time for for Southern Company uh uh com completing and bringing online the Vogal units and they're they're operating very well and when you see the growth opportunities that we SE that we've seen uh thus far and that we see coming in the future is just an exciting time uh but more important importantly I think is the opportunity and and and with this deep focus on customers and having this constructive regulatory environment that we have our ability to to meet this demand to to make sure we have resources available to meet this unprecedent and growth and to be able to to to serve it in a way uh that benefits all of our customers and so it's an exciting time feel real good about where we are and really excited about the future so so thanks for H giving me this opportunity to talk about Southern Company and where we are we've got a great story uh we we got a great business and and we're doing very well we're going to continue to make sure that we keep our customers at the center of everything that we did great Chris it's been a pleasure R it's always good to see you thanks for me and thanks Chris for your Q&A session at last point at my side this week we published the 15th Edition of the gleo journal which you can now download uh from here so if you choose the link on the uh image on your screen you should be able to download uh the journal if you have any questions about the journal if you have any questions about membership please get in contact with me on the email below thanks for listening