USA: Southern Company has increased its five-year capital spending plan from $76 B to $81 B as it prepares for strong growth in electricity demand across the US Southeast. The utility says the higher investment reflects major new infrastructure needs linked to large customers, particularly data centres.

Southern is working to add 10 GW of approved new generation and reported that its large load pipeline has reached 75 GW. Of this, 10 GW is already fully contracted, with a further 10 GW in late-stage negotiations. Around 3 GW of those projects are close to final approval, according to the company’s fourth-quarter earnings call.

Commercial electricity sales, which currently make up about one-third of Southern’s retail sales, are expected to more than double by the end of the decade, growing at around 20 % per year. To limit risk, Southern requires data centre customers to sign contracts lasting at least 15 years, supported by minimum payment clauses and termination fees.

Natural gas plays a central role in meeting the rising demand. Southern plans up to 700 MW of capacity upgrades at existing gas plants, potentially available from 2029, and is assessing new gas projects at six existing sites. Alongside this, the company has over $1 B of renewable projects under construction and has recently completed a 200 MW solar expansion in Texas.

Southern says its regulatory structure allows it to negotiate contracts directly with large customers, helping to shield existing users from costs. Subsidiaries Georgia Power and Alabama Power have secured rate stability agreements, with Georgia Power expecting $1.7 B in customer benefits between 2029 and 2031.

Source: Utility Dive

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