Background

Alabama Power provides the valuable combination of competitive prices, reliable electricity supply and unparalleled service to 1.4 million homes, businesses and industries in the southern two-thirds of Alabama. It is one of four U.S. utilities operated by Southern Company, one of the nation's largest producers of electricity.

Service territory
Alabama Power is the second largest subsidiary of Southern Company, serving homes, businesses and industries in the southern two-thirds of Alabama. More than 78,000 miles of power lines carry electricity to customers throughout 44,500 square miles.

Customers first
Our top priority is taking care of our customers. This means keeping reliability high and power rates low. In 2005, we had electricity available an average of 99.96 percent of the time while providing electricity at prices at least 15 percent below the national average.

Restructuring
California's power struggles: can they happen here?
While Alabama Power cannot speculate about what has caused the problems in California, experts say there are a number of contributing factors. However, given what we do know and are continuing to learn, it is unlikely that Alabama Power will experience similar problems in the near term.

Here's what you need to know about deregulation and Alabama Power:

• Alabama is not a deregulated state and there are no plans to deregulate at this time. California residents are experiencing problems as a result of deregulation.
• Price is usually a driver for deciding to deregulate. Alabama Power's prices are well below the national average.
• Alabama Power generates electricity from coal, hydro, natural gas, oil and nuclear sources. California relies mostly on hydro and natural gas to fuel its plants.
• We're building new plants and purchasing long-term wholesale power contracts to bolster our available energy resources. No new plants have been built in California in more than 10 years, and deregulation rules there prohibit long-term wholesale power contracts.

Alabama Power is confident about our ability to compete in a deregulated environment. However, we agree with the Alabama Public Service Commission's decision to hold off on the process until it is clear that it can be fair and produce savings for all customer classes.

Environmental stewardship
Alabama Power actively promotes electricity's environmental friendliness, funding research and development. Alabama Power meets or exceeds all standards set by state and federal environmental agencies. According to the U.S. Energy Information Agency, Alabama Power ranks among the top of all investor-owned utilities for its investment in equipment and technology to improve the environment. Environmental stewardship is good business.

Economic development
Alabama Power was the first electric utility in the U.S. to establish an Economic Development Department. We have been committed to encouraging and supporting economic growth throughout Alabama for decades. In fact, we've been helping companies with their site selection process for more than 80 years. Our commitment to Alabama's economic growth remains as strong as ever.

Energy conservation
Our employees work with customers to help them improve the energy efficiency of their homes, businesses and communities. Alabama Power also offers a variety of incentives and pricing options that allow Alabamians to better control their energy costs.

Community commitment
In the past year alone, the Alabama Power Service Organization contributed more than $1 million to Alabama communities and logged more than 70,000 hours of community service.

Lakes and recreation
Alabama Power's hydroelectric generating plants created several lakes on the Tallapoosa, Coosa and Warrior Rivers. The plants provide Alabama Power customers with clean, reliable electric energy. The surrounding waters offer abundant recreational opportunities for all who live and visit the state.

We engage in active land management programs to preserve the natural beauty of the area surrounding the lakes. Forests, wildflowers and water quality are managed and protected on company lands. And the public has lakeshore access through public recreation areas. Beaches, boat ramps, picnic areas, trails and camping sites are maintained for the public's enjoyment.