Southern Company’s Lobbying Disclosures Obscure State-Level Information from Investors, Public

Southern Company faces another challenge to improve its limited lobbying disclosures at the company’s upcoming Annual Meeting of Stockholders on May 27, according to a filing by Majority Action. Southern’s current lobbying disclosure policy allowed for secret expenditures to the Utility Air Regulatory Group, which litigated against environmental regulations. The company does not publish or report total lobbying expenditures in Alabama or Georgia despite employing almost 50 lobbyists in the two states, according to state records.

Southern Company’s low- to no lobbying disclosures have enabled lobbying activity that has been discordant with the policy objectives that the company has espoused to investors and the public. Southern has actively lobbied against environmental regulations and action on climate change at the federal level. The company’s state-level disclosures offer almost no indications of whether the company’s state lobbying follows its federal pattern or aligned with Southern’s stated corporate “low- to no-carbon” goals. Southern’s operating companies, Alabama Power, Georgia Power, and Mississippi Power have ignored the company’s “low- to no-carbon” goal, according to their own statements to regulators. 

CEO Tom Fanning frequently refers to utilities who resist technological change as trying to “keep the waves off the beach”.

Southern, however, was the world’s leading utility company opposing the Paris Climate Accord, according to a 2019 Influence Map report. The company was a primary voice denying the science of climate change via the Global Climate Coalition, the Information Council on the Environment, and funding discredited anti-climate researcher Willie Soon. Fanning previously denied the role of CO2 in climate change on CNBC. Fanning has been outspoken in his belief that Southern Company should invest heavily in government relations. 

Fanning gets credit toward bonus for coal closures after opposing federal regulations

Southern Company is frequently cited as one of the nation’s most prolific spenders on lobbying and has been one of the most vocal and steadfast utility opponents of environmental regulations and federal action on climate. Since 2010, Southern has spent more than $135 million on lobbying at the federal level, the most of any utility in the country. Southern has actively lobbied or litigated against the Clean Power Plan, Mercury and Air Toxics Standards, Cross State Air Pollution Rule, Coal Combustion Residual rules, and the Paris Climate Accord, among others. 

After opposing almost every federal initiative to reduce carbon emissions and increase clean energy, the company now claims that it has changed course, and has built additions of zero-carbon electricity and closures of coal plants into Fanning’s compensation incentive package. However, Fanning’s greenhouse gas bonus pays him for coal retirements that Southern says were caused by the very policies that Southern opposed under his leadership. In 2019, Alabama Power blamed, “federally driven environmental mandates related to coal” for the closure of Plant Gorgas, a coal-fired power plant. Alabama Power had upgraded pollution controls to the plant in 2015 for a total cost to customers of $740 million, including the company’s profit. Fanning received bonus credit for the closure of Gorgas.

Operating company CEOs, Mark Crosswhite of Alabama Power, Paul Bowers of Georgia Power, and Anthony Wilson of Mississippi Power, are not compensated for their performance toward Southern’s “low -to-no carbon” goal.

Despite its “low- to no-carbon” goal, Southern Company is actively lobbying Congress for “environmental regulatory relief, generally,” according to its first quarter 2020 federal lobbying disclosure.

Southern Relies on Limited State Filings to Obscure Lobbying

Investors have led calls for Southern Company to increase its lobbying disclosures, particularly at the state level, in light of the company’s substantial federal lobbying. The company has opposed shareholders’ calls for increased transparency. 

Southern told investors it already had “policies in place to provide transparency about its participation in the legislative process […].” Southern further claimed that it provided lobbying details to state ethics agencies, but state ethics laws in Alabama and Georgia do not require lobbyists or companies to disclose lobbying expenditures. Southern has yet to disclose total expenditures or information about its lobbying in those states.

Alabama is home to some of the weakest ethics laws in the nation. The state does not require lobbyists or companies to disclose the issue on which they lobbied, or the amount spent on lobbying. 16 lobbyists and lobbying firms worked for Southern Company in Alabama, yet no lobbyist disclosed any spending, according to Alabama Power’s first quarter 2020 lobbying report filed with the Alabama Ethics Commission.

Georgia similarly offers little detail on Southern Company’s lobbying priorities or expenditures. Georgia state law requires companies only to disclose spending on gifts to officials and public events. In 2019 and to date in 2020, Southern Company has employed 36 lobbyists in Georgia who spent almost $60,000 on food, tickets to football games, and other events with Georgia officials.

Mississippi requires that companies disclose slightly more information than Alabama and Georgia. Mississippi Power, Southern’s smallest electric operating company, spent more than $407,000 on lobbying in 2019 and more than $677,000 in 2018. However, Mississippi Power does not disclose the issues on which it lobbies, as Southern’s lobbyists do at the federal level.

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