Christopher C. Womack
Chairman, President and Chief Executive Officer at Southern
Thank you, Dan. Our system performed extremely well, and that's a testament to our team's collective commitment to serving customers reliably across our business, especially as we meet the demands of the extraordinary growth that we're seeing. Particularly within our Southeast footprint, we continue to see strong economic development activity with first quarter investment announcements, representing the second highest first quarter on record, as our teams continue to work closely with our states and local development authorities to attract new businesses. This growth continues to reflect a diverse mix of sectors with recent announcements, including automotive suppliers, flooring and glass manufacturers, data centers and mixed-use developments.
During our year-end earnings call in February, we updated our forecast to reflect projected retail electric sales growth that is accelerating to a projected growth rate of approximately 6% from 2025 to 2028. The underlying Georgia Power projected sales growth rate is approximately 9% over the same period. As we look ahead, we're encouraged to see the signs of incremental growth also materializing in Alabama and Mississippi.
A little more than weeks ago, the Georgia Public Service Commission approved a stipulated agreement among Georgia Power the Public Service Commission staff and multiple interveners in the 2023 IRP update docket. This approval affirms the need to quickly procure and deploy several thousand megawatts of resources to serve customers for rapidly growing project electricity demands by the winter of 2026 and 2027.
Georgia Power was also authorized to build and own a balanced collection of resources, including new natural gas combustion turbines and battery energy storage systems, while also providing for an accelerated RFP process for incremental battery energy storage systems. The constructiveness and timeliness of decisions like this are a testament to the quality of our Southeastern states regulatory environment and our ability to meet the projected rapid demand growth garnering headlines across the country.
Coinciding with Georgia Power's 2023, IRP update filing last fall, and the release of our sales forecast in February, external attention, including from the investment community has focused on several key questions. How do you know the load in your forecast is real? How do you know you're pricing this new load appropriately? And what protections are in place if the forecasted load does not materialize? Those are all very important questions and the answers are all fundamentals to how Southern Company has run our electric utilities for a very, very, very long time. We'll address each one, each one of those questions in just a moment.
First, I want to share with you what we believe are the four key characteristics required to successfully navigate this tremendous growth opportunity. We believe Southern Company is positioned as well or better than any utility company in the country on these four fronts.
First, it requires supportive states and constructive regulation. Our states continue to be great economic development partners and they have advanced economic policies that support healthy growth. When it comes to utility regulation, our states are among the best in the country at balancing the needs of customers while helping ensure utilities provide real value to customers in the form of clean, safe, reliable, and affordable energy.
Second, it requires institutional wherewithal. We have vast expertise and experience deploying energy infrastructure. We've been investing billions to improve the resilience of our electric and gas transmission and distribution networks. In recent years across our subsidiaries and across the country, we've built thousands of megawatts of energy supply in the form of new solar, wind and battery facilities, advanced micro grids, a state-of-the-art combined cycle natural gas plant and the only new nuclear units built in this country in more than a generation. These new assets, along with the existing electric and gas infrastructure we operate, have served customers with a superior measure of reliability and resilience. We have the people, we have the experience and we have the scale to be successful.
The third requirement is a flexible pricing framework. Our electric utilities working with existing customers approved by their respective public service commissions have a history of being able to price new large-load projects appropriately even in periods of high-demand and challenging market conditions. These frameworks are designed to benefit all customers. For example, Georgia Power's real-time pricing rate or RTP, which was pioneered decades ago allows for the flexibility to price individual customers based on their unique low-profile and risk characteristics.
And finally, success in this environment requires experience and discipline, experience understanding utility economics and the true marginal cost-to-serve new customers, experience identifying and mitigating the risk inherent and new or expanding large-load customers and experience in competing for new load with an objective of capturing tangible economic benefit for customers and states.
Our experience, combined with the robust models and tools we employ are partially a product of the competitive economic environment we've navigated in the Southeast for decades. For example, in Georgia, most new large-load customers can choose their electricity supplier. Over the years, we've been the chosen provider more often than not, however, its the load we did not win or perhaps did not even choose to compete for that reflects our discipline and experience by offering prices designed to recover the marginal cost-to-serve new loads. We seek to protect all other customers and importantly, maintain our credibility with our regulators and state policy makers.
I'll now turn back to Dan to address those three key stakeholder questions pertaining to this extraordinary growth opportunity.
