Georgia Power just landed one of the biggest data center deals in the country, and Wall Street is paying attention. OpenAI announced plans for a new project in Effingham County, Georgia, located about 45 minutes outside Savannah. The site is expected to bring thousands of jobs and billions of dollars in investment to the local community, according to a company statement from Georgia Power.
For Southern Company (SO), the parent of Georgia Power, the deal is the latest sign that its bet on the AI boom is paying off. The utility has spent the past year signing contract after contract with data center operators, and this OpenAI deal may be the largest single facility agreement in the bunch.
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www.barchart.com The OpenAI Power Deal Is Key for Southern Company
OpenAI is expected to need roughly 3,200 megawatts of power for the new facility. To put that in perspective, that is enough electricity to power more than two million homes. OpenAI has agreed to cover the full infrastructure and electric service costs needed to serve its facility. The company will also meet requirements for long-term energy contracts and provide financial assurances designed to protect existing Georgia Power customers.
That structure lines up with rules the Georgia Public Service Commission approved in January 2025, which sit at the center of Georgia Power's approach to serving large energy users without pushing costs onto everyday households. Under the 25-year agreement, OpenAI has committed to providing up to 1,000 megawatts of flexible demand response.
In simple terms, that means OpenAI agreed to cut its own power use during times of peak demand, giving Georgia Power more breathing room to keep the lights on for everyone else.
"We appreciate the leadership and thoughtfulness of the OpenAI team as they prepare to bring significant investment and cutting edge technology to Georgia," said Aaron Mitchell, senior vice president of Strategic Growth for Georgia Power, in a statement.
Georgia Power called its load flexibility agreement with OpenAI among the largest single-facility demand response commitments in the country.
Southern Company Stock Benefits From AI Boom
The OpenAI project is just one piece of a much bigger picture at Southern Company. On the company's first-quarter 2026 earnings call, Chairman, President, and CEO Chris Womack said the utility now has more than 11 gigawatts of contracted large-load agreements across its electric subsidiaries, up 1.9 gigawatts in just the last two months.
Chief Financial Officer David Poroch said data center usage jumped 42% year-over-year (YoY) in the first quarter, driving much of the company's commercial sales growth. Southern Company is also in active late-stage talks for another 12 gigawatts of contracted load through the mid-2030s. It has structured these deals so customers driving the new demand cover their full share of the cost.
Poroch explained that minimum bills built into the contracts are designed to recover costs upfront, rather than relying on data centers to hit certain usage targets before the company gets paid. That approach has helped Southern Company keep rates stable. Base rates are frozen in Georgia through 2028 and in Alabama through 2029.
The company is also getting a boost from Washington. Georgia Power and Alabama Power received a loan package of up to $26.54 billion from the Department of Energy's Office of Energy Dominance Financing. Over the roughly thirty-year term of the loans, customers are expected to see an estimated $7 billion in savings, according to a company statement.
Southern Company also joined President Donald Trump's Ratepayer Protection Pledge, a move Womack said reflects the company's commitment to making sure AI-driven growth benefits customers rather than burdens them.
Speaking at the Reindustrialize Summit in Detroit, Chief Operating Officer Stan Connally told an audience of 2,500 technology leaders, investors, and policymakers that the company is moving quickly to meet surging demand. "We've got to think differently," Connally said. "We've got to deploy technology differently, but we've just got to move faster."
What Is the SO Stock Price Target?
Analysts tracking the energy stock forecast adjusted earnings per share to expand from $4.30 in 2025 to $6.14 in 2030. If SO stock is priced at 18.5x forward earnings, similar to its 10-year average, it could surge roughly 30% within the next four years, after accounting for dividends.
Notably, Southern Company has increased its dividend for 25 consecutive years and has paid a dividend equal to or greater than the prior year for 79 straight years, dating back to 1948.
For a stock long known as a steady dividend payer, a combination of federal support, protective contract terms, and surging demand from names like OpenAI gives investors a reason to watch Southern Company closely as the AI buildout continues across the Southeast.
Out of the 25 analysts covering SO stock, six recommend “Strong Buy,” one recommends “Moderate Buy,” 16 recommend “Hold,” and two recommend “Strong Sell.” The average SO price target is $102.97, above the current price of about $98.
www.barchart.com On the date of publication, Aditya Raghunath did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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