DOE closes $26.54B loan to Southern subsidiaries for nuclear, 16-GW, 1,300-mile transmission

The Department of Energy closed a record $26.54 billion loan package that will finance more than 16 gigawatts of firm generation and over 1,300 miles of transmission and grid upgrades for Georgia Power and Alabama Power, a move the agency says will bolster reliability across the Southeast. The transaction was completed through DOE’s Office of Energy Dominance Financing, the agency’s newly created lending arm, and is characterized by DOE and multiple outlets as the largest single loan commitment in department history.

Powermag reports the $26.54 billion is split roughly $22.4 billion to Georgia Power and about $4.1 billion to Alabama Power. The loan documents carry an approximately 30-year term and remain available for draw through Sept. 15, 2033, giving Southern subsidiaries a multi-year window to pull funds for projects. Powermag also said the single closing “eclipses the entire prior EDF loan portfolio in a single closing.”

DOE described the package as funding a diversified suite of dispatchable resources and grid work. The department used the phrase “over 16 GW” of firm reliable power; Utility Dive provides a more specific aggregate of 16.7 GW of grid resources. Public statements and reporting list explicit components: 5 GW of new natural gas generation, about 6 GW from nuclear uprates and license renewals, hydropower modernization projects, battery energy storage systems, and more than 1,300 miles of transmission infrastructure and grid enhancement.

U.S. Secretary of Energy Chris Wright framed the deal as tied to administration energy priorities, saying, “Thanks to President Trump and the Working Families Tax Cut, the Energy Department is lowering energy costs and ensuring the American people have access to affordable, reliable, and secure energy for decades to come.” He added, “The President has been clear: America must reverse the energy subtraction agenda of past administrations and add more reliable power generation to our electrical grid. These loans will not only lower energy costs but also create thousands of jobs and increase grid reliability for the people of Georgia and Alabama.”

Southern Company leadership pitched the financing as essential to company growth. Southern’s chairman, president and CEO Chris Womack said, “These investments will support the extraordinary and transformative projected growth we're seeing across our company.” DOE and Southern estimate the package will deliver about $7 billion in electricity cost savings to Georgia and Alabama customers and reduce Southern’s interest expense by over $300 million per year, though E&E News noted that DOE and Southern “did not explain how it would help lower ratepayers’ bills.”

The loan arrives against the backdrop of Southern’s five-year multistate capital program totaling $81 billion. Powermag reports Southern already addressed roughly $9 billion of required equity through transactions including a $4 billion at-the-market program with forward contracts settling through 2026 and 2027 and $2 billion in equity units that convert to shares in 2028, and that the DOE loan will help avoid strain on credit ratings and borrowing costs.

DOE linked the transaction to President Trump’s Jan. 20, 2025 executive order “Unleashing American Energy” and said funding would be provided under the administration’s “Working Families Tax Cut.” Despite the scale and claims of consumer savings, public reporting contains no project-by-project list, no detailed timeline for in-service dates, and no public loan term sheet showing interest rate structure or covenants, leaving critical questions about how and when customers will see the promised benefits.