Bonbright Conference Current Environmental Issues A Utility Perspective

1. Bonbright ConferenceCurrent Environmental IssuesA Utility Perspective Chuck Huling Vice President, Environmental Affairs Oct. 10, 2008

2. Today’s Discussion • Who we are • Environmental challenges • What we’re doing • Where we’re headed • Our commitment

3. Alabama Power Georgia Power Mississippi Power Gulf Power Who we are • Largest of four Southern Company electric utilities • $7.2 billion in revenue • 2.3M+ customers • 9,000 employees • 13,000 miles of transmission lines • 61,000 miles of distribution lines • High customer satisfaction • Rates about 15 percent below the national average Alabama Power Georgia Power

4. Hydro 2% Nuclear 16% Hydro 5% DSM 4% Nuclear 10% Coal 66% Gas 16% Coal 44% Gas 37% 2008 Capacity 2008 Energy Georgia Power Generation Mix

5. U.S. Capacity Additions Percent of total

6. Environmental Challenges • Environmental controls • Climate change • Growth • Water and waste management • Changing landscape • Political, regulatory, judicial

7. Environmental Controls 2007 2008 2009 2010 2011 2012 2013 2014 Bowen 1-2 Bowen 3-4 1 1 3 3 Branch 1-2 Branch 3-4 Hammond 1-4 Scherer 1-2 1 Scherer 3-4 3 Wansley 1-2 Yates 6-7 Not to scale Baghouse Scrubber SCR

8. Climate Change

9. Southern Company’s Position Climate change is a challenging issue for our world and our nation. Southern Company is committed to a leadership role in finding solutions that make technological, environmental and economic sense. The focus of this effort must be on developing and deploying technologies that reduce greenhouse gases while making sure electricity remains reliable and affordable.

10. Climate Change Principles • Any policy or legislation must ... • Take a global approach • Apply economy-wide – i.e. not target one sector over another • Have limited economic impact • Have achievable targets and timetables tied to the availability of technology

11. 2008 2030 Environmental ChallengesGrowth

12. Water Management

13. Waste Management Plant Bowen Gypsum Storage Georgia Dome

14. Changing Landscape • Political, regulatory, judicial uncertainty • Clean Air Interstate Rule (CAIR) • Clean Air Mercury Rule (CAMR) • Non-attainment for ozone and particulate matter

15. What We’re Doing • The basics • Conserving, recycling, compliance with regulatory requirements • … and so much more • $5 billion in environmental controls, a diverse energy plan, sustainable change

16. What We’re DoingReducing Emissions with Environmental Controls 21 Scrubbers 9 SCRs 4 Baghouses

17. SO2 Scrubbers SO2 Scrubbers Scrubber’s reduce sulfur dioxide emissions

18. Historical Emissions Trends Population Up 58% MERCURY DOWN 75% NOx DOWN 85% SO2 DOWN 93% 1990

19. Plant Vogtle Conceptual View with Units 3 & 4 Plant McDonough Combined Cycle Diverse Energy Mix • Replacing 540 megawatts of coal-fired generation with more than 2,500 megawatts of natural gas-generation • Adding zero-emissions nuclear generation

20. Hybrid bucket trucks Voluntary no-idling policy SmartRide Sustainable Change

21. Where We’re Headed • Investing $400 million on environmental research and development • Developing one of nation’s largest biomass plants • Energy efficiency programs to reduce demand by 1,000 MW by 2010

22. Our Environmental Commitment We have a good environmental record and are taking steps to improve the environment in the communities we serve. • Solutions – • Balance – • Stewardship – We must balance environmental requirements with growing energy needs and the economy. We evaluate environmental concerns in the business decisions we make.