UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q


(Mark One)
ý		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended ~~June~~September 30, 2009
OR
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to

Commission File No. 333-159338

(An Electric Membership Corporation)
(Exact name of registrant as specified in its charter)


Georgia (State or other jurisdiction of incorporation or organization)		58-1211925 (I.R.S. employer identification no.)
2100 East Exchange Place Tucker, Georgia (Address of principal executive offices)		30084-5336 (Zip Code)
Registrant's telephone number, including area code		(770) 270-7600

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):Large Accelerated Filer o Accelerated Filer o Non-Accelerated Filer ý (Do not check if a smaller reporting company) Smaller Reporting Company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date.The registrant is a membership corporation and has no authorized or outstanding equity securities.

(This page has been left blank intentionally.)

Table of Contents

OGLETHORPE POWER CORPORATION
INDEX TO QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED ~~JUNE~~SEPTEMBER 30, 2009

			Page No.

PART I—FINANCIAL INFORMATION
	Item 1.	Financial Statements	2
		Unaudited Condensed Balance Sheets as of ~~June~~September 30, 2009 and December 31, 2008	2
		Unaudited Condensed Statements of Revenues and Expenses For the Three and ~~Six~~Nine Months ended ~~June~~September 30, 2009 and 2008	4
		Unaudited Condensed Statements of Patronage Capital and Membership Fees and Accumulated Other Comprehensive Deficit For the ~~Six~~Nine Months ended ~~June~~September 30, 2009 and 2008	5
		Unaudited Condensed Statements of Cash Flows For the ~~Six~~Nine Months ended ~~June~~September 30, 2009 and 2008	6
		Notes to Unaudited Condensed Financial Statements For the Three and ~~Six~~Nine Months ended ~~June~~September 30, 2009 and 2008	7
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	2018
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3331
	Item 4.	Controls and Procedures	3331
PART II—OTHER INFORMATION
	Item 1.	Legal Proceedings	3432
	Item 1A.	Risk Factors	3432
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3439
	Item 3.	Defaults Upon Senior Securities	3439
	Item 4.	Submission of Matters to a Vote of Security Holders	3439
	Item 5.	Other Information	3439
	Item 6.	Exhibits	3539
SIGNATURES			3640

Table of Contents

PART I—FINANCIAL INFORMATION
Item 1. Financial Statements

Oglethorpe Power Corporation
Condensed Balance Sheets (Unaudited)
~~June~~September 30, 2009 and December 31, 2008

(dollars in thousands)

2009

2008
Assets

Electric plant:

In service
$ 6,280,588 $ 5,906,865

Less: Accumulated provision for depreciation
(2,856,336 ) (2,753,954 )

3,424,252 3,152,911

Nuclear fuel, at amortized cost

194,771
179,020

Construction work in progress
418,289 307,464

4,037,312 3,639,395

Investments and funds:

Decommissioning fund
210,572 201,094

Deposit on Rocky Mountain transactions
111,868 108,219

Bond, reserve and construction funds
3,514 4,560

Investment in associated companies
53,491 43,441

Long-term investments
83,525 81,550

Other
391 391

463,361 439,255

Current assets:

Cash and cash equivalents, at cost
382,221 167,659

Restricted cash, at cost
— 10,255

Restricted short-term investments
80,756 —

Receivables
156,147 116,679

Inventories, at average cost
191,640 175,350

Prepayments and other current assets
6,566 5,619

817,330 475,562

Deferred charges:

Premium and loss on reacquired debt, being amortized
123,678 130,013

Deferred amortization of capital leases
81,629 85,612

Deferred debt expense, being amortized
51,672 41,905

Deferred outage costs, being amortized
30,123 27,137

Deferred tax assets
48,000 48,000

Deferred asset associated with retirement obligations
57,280 60,310

Deferred interest rate swap termination fees, being amortized
31,291 33,286

Deferred depreciation expense
54,768 42,955

Other
21,630 21,022

500,071 490,240

$ 5,818,074 $ 5,044,452


			(dollars in thousands)
		2009			2008
Assets
Electric plant:
	In service	$	6,346,830		$	5,906,865
	Less: Accumulated provision for depreciation		(2,890,826	)		(2,753,954	)

			3,456,004			3,152,911
	Nuclear fuel, at amortized cost		197,642			179,020
	Construction work in progress		501,281			307,464

			4,154,927			3,639,395

Investments and funds:
	Decommissioning fund		234,820			201,094
	Deposit on Rocky Mountain transactions		113,754			108,219
	Bond, reserve and construction funds		3,983			4,560
	Investment in associated companies		52,351			43,441
	Long-term investments		87,322			81,550
	Other		391			391

			492,621			439,255

Current assets:
	Cash and cash equivalents, at cost		470,611			167,659
	Restricted cash, at cost		—			10,255
	Restricted short-term investments		39,738			—
	Receivables		115,542			116,679
	Inventories, at average cost		199,847			175,350
	Prepayments and other current assets		5,503			5,619

			831,241			475,562

Deferred charges:
	Premium and loss on reacquired debt, being amortized		120,511			130,013
	Deferred amortization of capital leases		79,592			85,612
	Deferred debt expense, being amortized		52,106			41,905
	Deferred outage costs, being amortized		29,166			27,137
	Deferred tax assets		24,000			48,000
	Deferred asset associated with retirement obligations		33,470			60,310
	Deferred interest rate swap termination fees, being amortized		30,293			33,286
	Deferred depreciation expense, being amortized		54,412			42,955
	Other		24,366			21,022

			447,916			490,240

		$	5,926,705		$	5,044,452

The accompanying notes are an integral part of these condensed financial statements.

Table of Contents

Oglethorpe Power Corporation
Condensed Balance Sheets (Unaudited)
~~June~~September 30, 2009 and December 31, 2008

(dollars in thousands)

2009

2008
Equity and Liabilities

Capitalization:

Patronage capital and membership fees
$ 564,285 $ 535,829

Accumulated other comprehensive deficit
(1,427 ) (1,348 )

562,858 534,481

Long-term debt

3,637,431
3,278,856

Obligation under capital leases
216,475 236,067

Obligation under Rocky Mountain transactions
111,868 108,219

4,528,632 4,157,623

Current liabilities:

Long-term debt and capital leases due within one year
115,023 110,647

Short-term borrowings
221,974 140,000

Accounts payable
39,899 29,305

Accrued interest
49,285 34,539

Accrued and withheld taxes
13,982 18,827

Members' advances, current
154,109 —

Other current liabilities
38,118 28,081

632,390 361,399

Deferred credits and other liabilities:

Gain on sale of plant, being amortized
32,299 33,536

Net benefit of Rocky Mountain transactions, being amortized
55,743 57,336

Asset retirement obligations
290,589 281,458

Accumulated retirement costs for other obligations
45,343 49,675

Long-term contingent liability
48,000 48,000

Members' advances, non-current
31,643 5,000

Power sale agreement
95,128 —

Other
58,307 50,425

657,052 525,430

$ 5,818,074 $ 5,044,452


			(dollars in thousands)
		2009			2008
Equity and Liabilities
Capitalization:
	Patronage capital and membership fees	$	575,647		$	535,829
	Accumulated other comprehensive deficit		(1,085	)		(1,348	)

			574,562			534,481
	Long-term debt		3,672,139			3,278,856
	Obligation under capital leases		214,288			236,067
	Obligation under Rocky Mountain transactions		113,754			108,219

			4,574,743			4,157,623

Current liabilities:
	Long-term debt and capital leases due within one year		116,766			110,647
	Short-term borrowings		346,672			140,000
	Accounts payable		16,638			29,305
	Accrued interest		31,220			34,539
	Accrued and withheld taxes		20,940			18,827
	Members' advances, current		183,047			—
	Other current liabilities		19,599			28,081

			734,882			361,399

Deferred credits and other liabilities:
	Gain on sale of plant, being amortized		31,680			33,536
	Net benefit of Rocky Mountain transactions, being amortized		54,947			57,336
	Asset retirement obligations		295,155			281,458
	Accumulated retirement costs for other obligations		44,846			49,675
	Long-term contingent liability		24,000			48,000
	Members' advances, non-current		11,000			5,000
	Power sale agreement, being amortized		90,670			—
	Other		64,782			50,425

			617,080			525,430

		$	5,926,705		$	5,044,452

The accompanying notes are an integral part of these condensed financial statements.

Table of Contents

Oglethorpe Power Corporation
Condensed Statements of Revenues and Expenses (Unaudited)
For the Three and ~~Six~~Nine Months Ended ~~June~~September 30, 2009 and 2008

(dollars in thousands)

Three Months

Six Months

2009 2008 2009 2008
Operating revenues:

Sales to Members
$ 300,527 $ 319,045 $ 582,232 $ 610,355

Sales to non-Members
332 240 640 573

Total operating revenues
300,859 319,285 582,872 610,928

Operating expenses:

Fuel
98,592 119,903 187,166 218,790

Production
69,269 69,052 140,033 138,798

Purchased power
34,050 43,101 59,196 79,499

Depreciation and amortization
32,827 29,813 63,711 59,537

Accretion
4,566 4,272 9,131 8,575

Other
(47 ) (325 ) (47 ) (327 )

Total operating expenses
239,257 265,816 459,190 504,872

Operating margin
61,602 53,469 123,682 106,056

Other income (expense):

Investment income
8,561 7,823 16,063 16,689

Other
2,308 2,444 5,266 5,105

Total other income
10,869 10,267 21,329 21,794

Interest charges:

Interest on long-term debt and capital leases
59,439 53,378 115,575 109,006

Other interest
587 476 1,204 858

Allowance for debt funds used during construction
(4,739 ) (2,813 ) (8,544 ) (5,149 )

Amortization of debt discount and expense
4,375 3,877 8,320 7,650

Net interest charges
59,662 54,918 116,555 112,365

Net margin
$ 12,809 $ 8,818 $ 28,456 $ 15,485


				(dollars in thousands)
			Three Months						Nine Months
			2009			2008			2009			2008
Operating revenues:
	Sales to Members		$	308,414		$	333,725		$	890,646		$	944,080
	Sales to non-Members			334			296			974			869

		Total operating revenues		308,748			334,021			891,620			944,949

Operating expenses:
	Fuel			94,508			135,677			281,674			354,467
	Production			69,144			71,052			209,177			209,850
	Purchased power			44,349			43,048			103,545			122,547
	Depreciation and amortization			34,301			29,904			98,012			89,441
	Accretion			4,565			4,287			13,696			12,862
	Other			—			468			(47	)		141

		Total operating expenses		246,867			284,436			706,057			789,308

Operating margin				61,881			49,585			185,563			155,641

Other income (expense):
	Investment income			8,147			7,055			24,210			23,744
	Other			2,152			3,447			7,418			8,551

		Total other income		10,299			10,502			31,628			32,295

Interest charges:
	Interest on long-term debt and capital leases			59,419			53,883			176,198			163,747
	Allowance for debt funds used during construction			(3,979	)		(3,233	)		(12,523	)		(8,382	)
	Amortization of debt discount and expense			5,378			3,838			13,698			11,488

		Net interest charges		60,818			54,488			177,373			166,853

Net margin			$	11,362		$	5,599		$	39,818		$	21,083

The accompanying notes are an integral part of these condensed financial statements.

Table of Contents

Oglethorpe Power Corporation
Condensed Statements of Patronage Capital and Membership Fees
and Accumulated Other Comprehensive Deficit (Unaudited)
For the ~~Six~~Nine Months Ended ~~June~~September 30, 2009 and 2008

(dollars in thousands)

Patronage
Capital and
Membership
Fees

Accumulated
Other
Comprehensive
(Deficit)

Total

Balance at December 31, 2007 $ 516,570 $ (32,691 ) $ 483,879

Components of comprehensive margin:
Net margin 15,485 — 15,485
Realized deferred loss on interest rate swap arrangements — 32,806 32,806
Unrealized loss on available-for-sale securities — (4,527 ) (4,527 )

Total comprehensive margin 43,764

Balance at June 30, 2008 $ 532,055 $ (4,412 ) $ 527,643

Balance at December 31, 2008

$
535,829
$
(1,348
)
$
534,481

Components of comprehensive margin:
Net margin 28,456 — 28,456
Unrealized loss on available-for-sale securities — (79 ) (79 )

Total comprehensive margin 28,377

Balance at June 30, 2009 $ 564,285 $ (1,427 ) $ 562,858

		Patronage Capital and Membership Fees		Accumulated Other Comprehensive (Deficit)			Total

			(dollars in thousands)
Balance at December 31, 2007		$	516,570	$	(32,691	)	$	483,879

Components of comprehensive margin:
	Net margin		21,083		—			21,083
	Realized deferred loss on interest rate swap arrangements		—		32,806			32,806
	Unrealized loss on available-for-sale securities		—		(5,209	)		(5,209	)

Total comprehensive margin								48,680


Balance at September 30, 2008		$	537,653	$	(5,094	)	$	532,559

Balance at December 31, 2008		$	535,829	$	(1,348	)	$	534,481

Components of comprehensive margin:
	Net margin		39,818		—			39,818
	Unrealized gain on available-for-sale securities		—		263			263

Total comprehensive margin								40,081


Balance at September 30, 2009		$	575,647	$	(1,085	)	$	574,562

The accompanying notes are an integral part of these condensed financial statements.

Table of Contents

Oglethorpe Power Corporation
Condensed Statements of Cash Flows (Unaudited)
For the ~~Six~~Nine Months Ended ~~June~~September 30, 2009 and 2008

(dollars in thousands)

2009
2008
Cash flows provided (used) by operating activities:

Net margin
$ 28,456 $ 15,485

Adjustments to reconcile net margin to net cash provided (used) by operating activities:

Depreciation and amortization, including nuclear fuel
109,999 105,710

Accretion cost
9,131 8,575

Amortization of deferred gains
(2,830 ) (2,830 )

Allowance for equity funds used during construction
(1,406 ) (1,300 )

Deferred outage costs
(18,402 ) (21,858 )

Loss on sale of investments
13,981 4,840

Regulatory deferral of costs associated with nuclear decommissioning
(19,413 ) (6,622 )

Other
65 1,263

Change in operating assets and liabilities:

Receivables
(28,370 ) (90,829 )

Inventories
(15,850 ) 2,898

Prepayments and other current assets
(933 ) (669 )

Accounts payable
(11,184 ) 20,076

Accrued interest
14,745 9,182

Accrued and withheld taxes
(4,885 ) 6,837

Other current liabilities
375 (10,501 )

Settlement of interest rate swaps
— (33,771 )

Increase in Members' advances
180,753 —

Total adjustments
225,776 (8,999 )

Net cash provided (used) by operating activities
254,232 6,486

Cash flows provided (used) by investing activities:

Property additions
(270,099 ) (170,083 )

Plant acquisition
(105,008 ) —

Activity in decommissioning fund—Purchases
(351,150 ) (410,651 )

                                                       —Proceeds
348,283 404,134

Activity in bond, reserve and construction funds—Purchases
(4 ) (55 )

                                                                             —Proceeds
1,049 1,078

Decrease in restricted cash and cash equivalents
10,255 48,124

Purchase of restricted short-term investments
(80,756 ) —

Activity in investment in associated organizations—Purchases
(11,254 ) (349 )

                                                                                —Proceeds
967 2,240

Activity in other long-term investments—Purchases
(742 ) (183,853 )

                                                                —Proceeds
200 193,413

Other
(493 ) (3,025 )

Net cash provided (used) by investing activities
(458,752 ) (119,027 )

Cash flows provided (used) by financing activities:

Long-term debt proceeds
408,900 23,591

Long-term debt payments
(65,552 ) (360,810 )

Increase in short-term borrowings
81,974 260,290

Other
(6,240 ) (1,226 )

Net cash provided (used) by financing activities
419,082 (78,155 )

Net increase (decrease) in cash and cash equivalents
214,562 (190,696 )
Cash and cash equivalents at beginning of period
167,659 290,930

Cash and cash equivalents at end of period
$ 382,221 $ 100,234

Supplemental cash flow information:

Cash paid for—

Interest (net of amounts capitalized)
$ 93,489 $ 95,532
Supplemental disclosure of non-cash investing and financing activities:

Plant expenditures included in ending accounts payable
$ 20,686 $ (12,121 )

Power purchase and sale liability
$ 98,100 $ —


					(dollars in thousands)
				2009			2008
Cash flows provided (used) by operating activities:
	Net margin			$	39,818		$	21,083

	Adjustments to reconcile net margin to net cash provided (used) by operating activities:
		Depreciation and amortization, including nuclear fuel			171,124			159,865
		Accretion cost			13,696			12,862
		Amortization of deferred gains			(4,245	)		(4,245	)
		Allowance for equity funds used during construction			(1,904	)		(2,107	)
		Deferred outage costs			(25,362	)		(27,245	)
		Loss on sale of investments			12,018			5,998
		Regulatory deferral of costs associated with nuclear decommissioning			(20,810	)		(10,948	)
		Other			(483	)		2,163
	Change in operating assets and liabilities:
		Receivables			(5,501	)		(106,320	)
		Inventories			(24,056	)		(4,876	)
		Prepayments and other current assets			131			26
		Accounts payable			(12,512	)		1,685
		Accrued interest			(3,319	)		4,808
		Accrued and withheld taxes			2,072			13,482
		Other current liabilities			(92	)		(8,240	)
		Settlement of interest rate swaps			—			(33,771	)
		Increase in Members' advances			189,047			—

			Total adjustments		289,804			3,137

Net cash provided by operating activities					329,622			24,220

Cash flows provided (used) by investing activities:
		Property additions			(454,313	)		(245,452	)
		Plant acquisition			(105,008	)		—
		Activity in decommissioning fund—Purchases			(495,689	)		(463,768	)
		—Proceeds			491,715			456,451
		Activity in bond, reserve and construction funds—Purchases			(475	)		(73	)
		—Proceeds			1,052			1,132
		Decrease in restricted cash and cash equivalents			10,255			48,124
		Purchase of restricted short-term investments			(39,738	)		—
		Activity in investment in associated organizations—Purchases			(11,395	)		(1,349	)
		—Proceeds			1,666			5,599
		Activity in other long-term investments—Purchases			(1,037	)		(184,336	)
		—Proceeds			900			193,413
		Other			(2,735	)		(1,950	)

Net cash used by investing activities					(604,802	)		(192,209	)

Cash flows provided (used) by financing activities:
		Long-term debt proceeds			464,026			282,936
		Long-term debt payments			(86,419	)		(578,475	)
		Increase in short-term borrowings			206,672			238,688
		Other			(6,147	)		(3,035	)

Net cash provided (used) by financing activities					578,132			(59,886	)

Net increase (decrease) in cash and cash equivalents					302,952			(227,875	)
Cash and cash equivalents at beginning of period					167,659			290,930

Cash and cash equivalents at end of period				$	470,611		$	63,055

Supplemental cash flow information:
Cash paid for—
		Interest (net of amounts capitalized)		$	161,457		$	145,375
Supplemental disclosure of non-cash investing and financing activities:
		Plant expenditures included in ending accounts payable		$	(977	)	$	(11,978	)
		Acquired power purchase and sale liability		$	98,100		$	—

The accompanying notes are an integral part of these condensed financial statements.

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Oglethorpe Power Corporation
Notes to Unaudited Condensed Financial Statements
~~June~~September 30, 2009 and 2008

(A): General. The condensed financial statements included in this report have been prepared by Oglethorpe Power Corporation (an Electric Membership Corporation) (Oglethorpe), pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). In the opinion of management, the information furnished in this report reflects all adjustments (which include only normal recurring adjustments) and estimates necessary to fairly state, in all material respects, the results for the ~~three-and six-month~~three- and nine-month periods ended ~~June~~September 30, 2009 and 2008. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles (GAAP) have been condensed or omitted pursuant to SEC rules and regulations, although Oglethorpe believes that the disclosures are adequate to make the information presented not misleading. These condensed financial statements should be read in conjunction with the financial statements and the notes thereto included in Oglethorpe's Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (Oglethorpe's 2008 Form 10-K), as filed with the SEC. The results of operations for the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 are not necessarily indicative of results to be expected for the full year. As noted in Oglethorpe's ~~Annual Report on~~2008 Form 10-K, ~~for the fiscal year ended December 31, 2008,~~ substantially all of Oglethorpe's sales are to its 38 electric distribution cooperative members (the Members) and, thus, the receivables on the accompanying balance sheets are principally from its Members. (See "Notes to Financial Statements" in Oglethorpe's ~~Annual Report on~~2008 Form ~~10-K for the fiscal year ended December 31, 2008.~~10-K.)
(B): Fair Value Measurements. ~~Fair~~Authoritative guidance regarding fair value measurements for financial and non-financial assets and liabilities ~~are disclosed in accordance with Statement of Financial Accounting Standards (SFAS) No. 157, "Fair Value Measurements." SFAS No. 157~~ defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosures about fair value measurements. ~~SFAS No. 157 does not require any new fair value measurements.~~

~~SFAS No. 157~~The guidance establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

•: Level 1. Quoted prices from active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Quoted prices in active markets provide the most reliable evidence of fair value and ~~shall be~~are used to measure fair value whenever available. Level 1 primarily consists of financial instruments that are exchange-traded.
•: Level 2. Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 2 includes financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Level 2 primarily consists of financial instruments that are non-exchange-traded but have significant observable inputs.
•: Level 3. Pricing inputs that include significant inputs ~~that~~which are generally less observable from objective sources. These inputs may include internally developed methodologies that result in management's best estimate of fair value. Level 3 financial instruments are those whose fair value is based on significant unobservable inputs.

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As required by ~~SFAS No. 157,~~the guidance, assets and liabilities measured at fair value are based on one or more of the following three valuation techniques:

1. Market approach. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business) and deriving fair value based on these inputs.

2. Income approach. The income approach uses valuation techniques to convert future amounts (for example, cash flows or earnings) to a single present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts.

3. Cost approach. The cost approach is based on the amount that currently would be required to replace the service capacity of an asset (often referred to as current replacement cost). This approach assumes that the fair value would not exceed what it would cost a market participant to acquire or construct a substitute asset or comparable utility, adjusted for obsolescence.

The tables below detail assets and liabilities measured at fair value on a recurring basis for the periods ending ~~June~~September 30, 2009 and December 31, ~~2008, respectively.~~2008.

Fair Value Measurements at Reporting Date Using

Quoted Prices in
Active Markets for
Identical Assets

Significant Other
Observable
Inputs

Significant
Unobservable
Inputs

June 30,
2009 (Level 1) (Level 2) (Level 3)

(dollars in thousands)
Decommissioning funds
$ 210,572 $ 194,637 $ 7,274 $ 8,661
Bond, reserve and construction funds
3,514 3,514 — —
Long-term investments
83,525 54,226 — 29,299
Natural gas swaps
(29,558 ) — (29,558 ) —
Deposit on Rocky Mountain transactions
111,868 — — 111,868
Investments in associated companies
53,491 — — 53,491


				Fair Value Measurements at Reporting Date Using
					Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs			Significant Unobservable Inputs
		September 30, 2009			(Level 1)		(Level 2)			(Level 3)

		(dollars in thousands)
Decommissioning funds	$	234,820		$	226,819	$	2,462		$	5,539
Bond, reserve and construction funds		3,983			3,983		—			—
Long-term investments		87,322			58,696		—			28,626	(1)
Natural gas swaps		(11,235	)		—		(11,235	)		—
Deposit on Rocky Mountain transactions		113,754			—		—			113,754
Investments in associated companies		52,351			—		—			52,351

Fair Value Measurements at Reporting Date Using

Quoted Prices in
Active Markets for
Identical Assets

Significant Other
Observable
Inputs

Significant
Unobservable
Inputs

December 31,
2008 (Level 1) (Level 2) (Level 3)

(dollars in thousands)
Decommissioning funds
$ 201,094 $ 184,854 $ 10,155 $ 6,085
Bond, reserve and construction funds
4,560 4,560 — —
Long-term investments
81,550 51,907 — 29,643 (1)
Natural gas swaps
(18,836 ) — (18,836 ) —
Deposit on Rocky Mountain transactions
108,219 — — 108,219
Investments in associated companies
43,441 — — 43,441


				Fair Value Measurements at Reporting Date Using
					Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs			Significant Unobservable Inputs
		September 30, 2009			(Level 1)		(Level 2)			(Level 3)

		(dollars in thousands)
Decommissioning funds	$	201,094		$	184,854	$	10,155		$	6,085
Bond, reserve and construction funds		4,560			4,560		—			—
Long-term investments		81,550			51,907		—			29,643	(1)
Natural gas swaps		(18,836	)		—		(18,836	)		—
Deposit on Rocky Mountain transactions		108,219			—		—			108,219
Investments in associated companies		43,441			—		—			43,441

(1): Represents auction rate securities investments held by Oglethorpe.

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The following tables present the changes in Oglethorpe's Level 3 assets and liabilities measured at fair value on a recurring basis ~~using significant unobservable inputs for~~during the three and ~~six~~nine months ended ~~June~~September 30, 2009 and 2008, respectively.

Three Months Ended
June 30, 2009
Decommissioning
funds Long-term
investments Deposit on Rocky
Mountain
transactions Investments in
associated
companies

(dollars in thousands)
Assets:

Balance at March 31, 2009
$ 1,440 $ 29,619 $ 110,044 $ 43,845
Total gains or losses (realized/unrealized):

comprehensive deficit
— (120 ) — —
Purchases, issuances, liquidations
— (200 ) — —
Transfers to Level 3
7,221 — 1,824 9,646

Balance at June 30, 2009
$ 8,661 $ 29,299 $ 111,868 $ 53,491

		Decommissioning funds			Long-term investments			Deposit on Rocky Mountain transactions		Investments in associated companies

		Three Months Ended September 30, 2009

			(dollars in thousands)
Assets:
Balance at June 30, 2009		$	8,661		$	29,299		$	111,868	$	53,491
Total gains or losses (realized/unrealized):
	Included in earnings		31			—			—		—
	Included in regulatory asset		(4	)		—			—		—
	Impairment included in other comprehensive deficit		—			27			—		—
Purchases, issuances, liquidations			—			(700	)		—		—
Transfers to Level 3			(3,149	)		—			1,886		(1,140	)

Balance at September 30, 2009		$	5,539		$	28,626		$	113,754	$	52,351


		Six Months Ended June 30, 2009										Nine Months Ended September 30, 2009
			Decommissioning funds		Long-term investments			Deposit on Rocky Mountain transactions		Investments in associated companies			Decommissioning funds			Long-term investments			Deposit on Rocky Mountain transactions		Investments in associated companies

Assets:	Assets:										Assets:
Balance at January 1, 2009	Balance at January 1, 2009	$	6,085	$	29,643		$	108,219	$	43,441	Balance at January 1, 2009	$	6,085		$	29,643		$	108,219	$	43,441
Total gains or losses (realized/unrealized):	Total gains or losses (realized/unrealized):										Total gains or losses (realized/unrealized):
	Impairment included in other comprehensive deficit		—		(144	)		—		—	Included in earnings		31			—			—		—
											Included in regulatory asset		(4	)		—			—		—
											Impairment included in other comprehensive deficit		—			(117	)		—		—
Purchases, issuances, liquidations	Purchases, issuances, liquidations		—		(200	)		—		—	Purchases, issuances, liquidations		—			(900	)		—		—
Transfers to Level 3	Transfers to Level 3		2,576		—			3,649		10,050	Transfers to Level 3		(573	)		—			5,535		8,910

Balance at June 30, 2009		$	8,661	$	29,299		$	111,868	$	53,491
Balance at September 30, 2009											Balance at September 30, 2009	$	5,539		$	28,626		$	113,754	$	52,351

Three Months Ended
June 30, 2008
Decommissioning
funds Long-term
investments Deposit on Rocky
Mountain
transactions Investments in
associated
companies

Assets:

Balance at March 31, 2008
$ 985 $ 51,165 $ 102,981 $ 45,217
Total gains or losses (realized/unrealized):

Included in earnings
(46 ) — — —

Included in regulatory asset
(50 ) — — —

comprehensive deficit
— (1,589 ) — —
Purchases, issuances, liquidations
— (15,000 ) — —
Transfers to Level 3
(827 ) — 1,708 (368 )

Balance at June 30, 2008
$ 62 $ 34,576 $ 104,689 $ 44,849

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Six Months Ended
June 30, 2008
Decommissioning
funds Long-term
investments Deposit on Rocky
Mountain
transactions Investments in
associated
companies

Assets:

Balance at January 1, 2008
$ 1,342 $ 7,300 $ 101,272 $ 46,449
Total gains or losses (realized/unrealized):

Included in earnings
(96 ) — — —

Included in regulatory asset
(30 ) — — —

Impairment included in other comprehensive deficit
— (4,024 ) — —
Purchases, issuances, liquidations
— (15,000 ) — —
Transfers to Level 3
(1,154 ) 46,300 3,417 (1,600 )

Balance at June 30, 2008
$ 62 $ 34,576 $ 104,689 $ 44,849


			Three Months Ended September 30, 2008
				Decommissioning funds			Long-term investments			Deposit on Rocky Mountain transactions		Investments in associated companies

				(dollars in thousands)
Assets:
Balance at June 30, 2008			$	62		$	34,576		$	104,689	$	44,849
Total gains or losses (realized/unrealized):
	Included in earnings			35			—			—		—
	Included in regulatory asset			4			—			—		—
		comprehensive deficit		—			(768	)		—		—
Transfers to Level 3				(101	)		—			1,765		(2,368	)

Balance at September 30, 2008			$	—		$	33,808		$	106,454	$	42,481


		Nine Months Ended September 30, 2008
			Decommissioning funds			Long-term investments			Deposit on Rocky Mountain transactions		Investments in associated companies

			(dollars in thousands)
Assets:
Balance at January 1, 2008		$	1,342		$	7,300		$	101,272	$	46,449
Total gains or losses (realized/unrealized):
	Included in earnings		(92	)		—			—		—
	Included in regulatory asset		5			—			—		—
	Impairment included in other comprehensive deficit		—			(4,792	)		—		—
Purchases, issuances, liquidations			—			(15,000	)		—		—
Transfers to Level 3			(1,255	)		46,300			5,182		(3,968	)

Balance at September 30, 2008		$	—		$	33,808		$	106,454	$	42,481

Interest Rate Swaps
Liabilities:

Balance at January 1, 2008
$ 30,526
Total gains or losses (realized/unrealized):

Included in other comprehensive deficit
3,245

Included in regulatory assets and liabilities
(33,771 )

Balance at June 30, 2008
$ —


		Interest Rate Swaps
Liabilities:
Balance at January 1, 2008		$	30,526
Total gains or losses (realized/unrealized):
	Included in other comprehensive deficit		3,245
	Included in regulatory assets and liabilities		(33,771	)

Balance at September 30, 2008		$	—

~~Based on~~The assets included in the "Long-term investments" column in each of the tables above are auction rate securities held by Oglethorpe. As a result of market conditions, including the failure of ~~various~~ auctions for the auction rate securities in which Oglethorpe invested, ~~Oglethorpe uses~~the fair value of these auction rate securities was determined using an income approach ~~valuation using~~based on a discounted cash flow model. The discounted cash flow model ~~based on~~utilized projected cash flows at current rates, ~~and~~which was adjusted for illiquidity premiums based on discussions with market ~~participants to determine the fair value~~participants. At September 30,

Table of ~~these investments. At June 30,~~ Contents

2009, Oglethorpe held auction rate securities with maturity dates ranging from March 15, 2028 to December 1, 2045.

Based on the fair value of these auction rate securities as of ~~June~~September 30, 2009, ~~determined using a discounted cash flow analysis,~~ an additional temporary impairment of approximately ~~$145,000~~$117,000 was recorded as an incremental adjustment to the $1,657,000 that was previously recorded at December 31, 2008. The temporary impairment is reflected in "Accumulated other comprehensive deficit" on the condensed unaudited balance sheets. The various assumptions Oglethorpe utilizes to determine the fair value of its auction rate securities investments will vary from period to period based on the prevailing economic conditions. If the market for Oglethorpe's auction rate securities investments ~~deteriorates further,~~should deteriorate, Oglethorpe may need to increase the illiquidity premium used in preparing a discounted cash flow model for these securities. A 25 basis point increase in the illiquidity premium used to determine the fair value of these investments at ~~June~~September 30, 2009, would have resulted in a decrease in the fair value of Oglethorpe's auction rate securities investments by approximately ~~$1,634,000.~~$1,598,000.

These investments were rated either A3 or Aaa by Moody's Investors Service (Moody's) and AAA by Standard and Poor's (S&P)~~, respectively,~~ as of ~~June~~September 30, 2009. Therefore, it is expected that the investments will not be settled at a price less than par value. Because Oglethorpe has the ability and intent to hold these investments until a recovery of its original investment value, it considered the investments to be temporarily impaired at ~~June~~September 30, 2009.

~~Table of Contents~~

(C): ~~Adoption of SFAS No. 161, "Disclosures~~Disclosures about Derivative Instruments and Hedging Activities." ~~Effective January 1, 2009,~~Oglethorpe's Risk Management Committee provides general oversight over all risk management activities, including but not limited to, commodity trading and investment portfolio management. Oglethorpe ~~adopted SFAS No. 161. The standard is intended to improve financial reporting about derivative~~uses commodity trading derivatives, which are designated as hedging instruments under authoritative guidance for Accounting for Derivatives and ~~hedging activities by requiring enhanced disclosures that reflect the effect of these activities on an entity's financial position, financial performance, and cash flows.~~

~~Oglethorpe has entered into natural gas swap arrangements~~Hedging Activities, to manage its exposure to fluctuations in the market price of natural gas. Consistent with Oglethorpe's rate-making treatment for energy costs which are flowed-through to the Members, unrealized gains or losses on the natural gas swaps are reflected as an unbilled receivable. Within Oglethorpe's nuclear decommissioning trust fund, derivatives including options, swaps and credit default swaps which are non-speculative, are utilized to mitigate volatility associated with duration, default, yield curve and the interest rate risks of the portfolio. Consistent with Oglethorpe's rate-making treatment, unrealized gains or losses from the decommissioning trust fund are recorded as an increase or decrease to the regulatory asset or liability.

Under ~~these~~the natural gas swap arrangements, Oglethorpe pays the counterparty a fixed price for specified natural gas quantities and receives a payment for such quantities based on a market price index. These payment obligations are netted, such that if the market price index is lower than the fixed price, Oglethorpe will make a net payment, and if the market price index is higher than the fixed price, Oglethorpe will receive a net payment.

At ~~June~~September 30, 2009, the estimated fair value of Oglethorpe's natural gas contracts was an unrealized loss of approximately ~~$29,558,000.~~$11,235,450. See Note B for further discussion on fair value measurements of financial instruments. Consistent with Oglethorpe's rate-making for energy costs which are passed through to the Members, these unrealized losses are reflected as an unbilled receivable on Oglethorpe's balance sheet.

~~The following table presents Oglethorpe's natural gas derivative volumes as of June 30, 2009 that are expected to settle each year:~~

Year
Natural Gas Swaps
(MMBTUs)
(in millions)

2009
5.99
2010
5.34
2011
0.08

Total
11.41

~~The table below reflects the fair value of derivative instruments and their effect on Oglethorpe's condensed unaudited balance sheets for the period ending June 30, 2009.~~

Regulatory Assets
Liability Derivatives

Balance Sheet
Location

Fair Value

Balance Sheet
Location

Fair Value

(dollars in thousands)
Derivatives designated as hedging instruments under SFAS No. 133:

Commodity contracts (Natural Gas Swaps)
Receivables $ 29,559
Other Current Liabilities
$ 29,559
Commodity contracts (Natural Gas Swaps)
Receivables (1 )
Other Current Liabilities
(1 )

Total Derivatives designated as hedging instruments under SFAS No. 133
$ 29,558 $ 29,558

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The following table presents the gains and (losses) on derivative instruments recognized in income for the three and six months ending June 30, 2009. Gains and (losses) related to these instruments are recorded in "Purchase power" in the condensed unaudited statements of revenues and expenses.

Effect of Derivative Instruments on the Condensed Statement of Revenues and Expenses

Derivatives in SFAS No. 133
Fair Value Hedging Relationships

Three months
ended

Six months
ended

(dollars in thousands)

Commodity contracts (Natural Gas Swaps)
$ — $ 46

Commodity contracts (Natural Gas Swaps)

(7,477
)
(9,556
)

Total
$ (7,477 ) $ (9,510 )

Oglethorpe is exposed to credit risk as a result of entering into these hedging arrangements. Credit risk is the potential loss resulting from a counterparty's nonperformance under an agreement. Oglethorpe manages credit risk with policies and procedures for, among other things, counterparty analysis, exposure measurement, and exposure monitoring and mitigation.

It is possible that volatility in commodity prices could cause Oglethorpe to have credit risk exposures with one or more counterparties. If such counterparties fail to perform their obligations,

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Oglethorpe could suffer a financial loss. However, as of ~~June~~September 30, 2009, all of the counterparties with transaction amounts outstanding in Oglethorpe's hedging portfolio are rated above investment grade by the major rating agencies or have provided a guaranty from one of their affiliates that is rated above investment grade.

Oglethorpe has entered into International Swaps and Derivatives Association Agreements with its natural gas hedge counterparties that mitigate credit exposure by creating contractual rights relating to creditworthiness, collateral, termination and netting (which allows Oglethorpe to use the net value of affected transactions with the same counterparty in the event of default by the counterparty or early termination of the agreement).

Additionally, Oglethorpe has implemented procedures to monitor the creditworthiness of ~~our~~its counterparties and to consider nonperformance in valuing counterparty positions. Oglethorpe has contracted with a third party to assist in monitoring counterparties' credit standing, including those ~~that are~~ experiencing financial problems, have significant swings in credit default swap rates, have credit rating changes by external rating agencies, or have changes in ownership. Net liability positions are generally not adjusted as Oglethorpe uses derivative transactions as hedges and has the ability and intent to perform under each of ~~their~~its contracts. In the instance of net asset positions, Oglethorpe considers general market conditions and the observable financial health and outlook of specific counterparties, forward looking data such as credit default swaps, when available, and historical default probabilities from credit rating agencies in evaluating the potential impact of nonperformance risk to derivative positions.

The contractual agreements contain provisions that could require either Oglethorpe or the counterparty to post collateral or credit support. The amount of collateral or credit support that could be required is calculated as the difference between the aggregate fair value of the hedges and pre-established credit thresholds. The credit thresholds are contingent upon each party's credit standing and credit ratings from the major credit rating agencies. The collateral and credit support requirements vary by contract and by counterparty. Oglethorpe may only post credit support in the form of a letter of credit due to provisions within its ~~Mortgage Indenture;~~Rural Utilities Service (RUS) Loan Contract; however, Oglethorpe may receive collateral in the form of cash or credit support. As of ~~June~~September 30, 2009, neither

~~Table of Contents~~

Oglethorpe nor any counterparties were required to post credit support or collateral under any of these agreements. If the credit-risk-related contingent features underlying these agreements were triggered on ~~June~~September 30, 2009 due to Oglethorpe's credit rating being downgraded below investment grade, Oglethorpe could have been required to post letters of credit totaling up to ~~$29,558,000~~$11,235,000 with its counterparties.

The following table reflects the volume activity of Oglethorpe's natural gas derivatives and derivatives within the nuclear decommissioning trust fund as of September 30, 2009 that are expected to settle or mature each year:



Year	Natural Gas Swaps (MMBTUs) (in millions)	Derivative Instruments (in millions)

2009	0.41	1.3
2010	5.50	(14.6	)
2011	.46	(.6	)
2014	—	.8
2016	—	(.8	)

Total	6.37	(13.9	)

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The table below reflects the fair value of derivative instruments and their effect on Oglethorpe's condensed unaudited balance sheets for the period ended September 30, 2009.


		Balance Sheet Location	Fair Value
				(dollars in thousands)
Designated as hedges under authoritative guidance related to derivatives and hedging activities:
Assets
	Natural Gas Swaps	Receivables	$	11,289
	Natural Gas Swaps	Receivables		(54	)

Total assets designated as hedges under authoritative guidance related to derivatives and hedging activities			$	11,235

Liabilities
	Natural Gas Swaps	Other current liabilities	$	11,289
	Natural Gas Swaps	Other current liabilities		(54	)

Total liabilities designated as hedges under authoritative guidance related to derivatives and hedging activities			$	11,235

Not designated as hedges under authoritative guidance related to derivatives and hedging activities:
Assets
	Nuclear decommissioning trust	Decommissioning fund	$	23,875
	Nuclear decommissioning trust	Decommissioning fund		(24,292	)
	Nuclear decommissioning trust	Deferred asset associated with retirement obligations		24,051
	Nuclear decommissioning trust	Deferred asset associated with retirement obligations		(23,975	)

Total not designated as hedges under authoritative guidance related to derivatives and hedging activities			$	(341	)

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The following table presents the gains and (losses) on derivative instruments recognized in income for the three and nine months ended September 30, 2009.


Effect of Derivative Instruments on the Condensed Statement of Revenues and Expenses
		Income Statement Location		Three months ended			Nine months ended

				(dollars in thousands)
Designated as hedges under authoritative guidance related to derivatives and hedging activities
	Natural Gas Swaps	Purchase power	$	—		$	46
	Natural Gas Swaps	Purchase power		(19,565	)		(29,121	)
Not designated as hedges under authoritative guidance related to derivatives and hedging activities
	Nuclear decommissioning trust	Investment income		1,327			2,662
	Nuclear decommissioning trust	Investment income		(1,211	)		(2,921	)

Total losses on derivatives			$	(19,449	)	$	(29,334	)

(D): Recently Issued or Adopted Accounting Pronouncements. In September 2009, Oglethorpe adopted ~~SFAS No. 165, "Subsequent Events" issued~~the Financial Accounting Standards Board (FASB) Codification and the Hierarchy of Generally Accepted Accounting Principles (Codification). The Codification creates a two-level GAAP hierarchy—authoritative and non-authoritative—and establishes the Codification as the sole source of authoritative GAAP for non-governmental entities, except for rules and releases by the FASB in May 2009 effective June 30, 2009. SFAS No. 165 establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. It requires management to evaluate events or transactions that may occur for potential recognition of disclosure in the financial statements, the circumstances under which events or transactions occurring after the balance sheet date should be recognized and events or transactions that should be disclosed that occur after the balance sheet date.SEC. The adoption ~~of SFAS No. 165 did not have a material effect~~had no impact on Oglethorpe's results of operations, cash flows or financial condition.

In accordance with SFAS No. 165, Oglethorpe evaluated subsequent events up until the time that its financial statements were issued and filed with the SEC on August 12, 2009. Subsequent events identified are discussed in Note L of this Form 10-Q.

In June 2009, the FASB issued ~~SFAS No. 166, "Accounting~~Accounting for Transfers of Financial Assets—an amendment of ~~SFAS No. 140."~~Accounting for Transfers for Servicing of Financial Assets and Extinguishments of Liabilities. The standard requires improved disclosures about transfers of financial assets and removes the exception from applying ~~FIN 46(R)~~Consolidation of Variable Interest Entities to qualifying special purpose entities. ~~SFAS No. 166~~The standard is effective January 1, 2010. Currently, the adoption of ~~SFAS No. 166~~the standard is not expected to have a material effect on Oglethorpe's results of operations, cash flows or financial condition.

In June 2009, the FASB issued ~~SFAS No. 167, "Amendments~~Amendments to ~~FASB Interpretation No. 46(R)." SFAS No. 167~~the Consolidation of Variable Interest Entities. The standard provides new consolidation guidance for variable interest entities (VIE) and requires a company to assess the determination of the primary beneficiary of a VIE based on whether the company has the power to direct matters that most significantly impact the activities of the VIE, and the obligation to absorb losses or the right to receive benefits of the VIE. The standard also requires ongoing reassessments of whether a company is the primary beneficiary of a VIE. ~~SFAS No. 167~~The standard is effective beginning January 1, 2010. Early application is prohibited. Oglethorpe is currently evaluating the impact of ~~SFAS No. 167~~the new standard on ~~our~~its results of operations, cash flows and financial position.

In June 2009, the FASB issued SFAS No. 168, "The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles—a replacement of FASB Statement No. 162." SFAS No. 168 creates a two-level GAAP hierarchy—authoritative and non-authoritative—and establishes the FASB's Accounting Standards Codification (Codification) as the sole source of authoritative GAAP for non-governmental entities, except for rules and releases by the SEC.

After July 1, 2009, all non grandfathered, non-SEC accounting literature not included in the Codification will become non-authoritative. SFAS No. 168 is effective for Oglethorpe beginning September 30, 2009 and will have no impact on Oglethorpe's results of operations, cash flows or financial condition.

~~Table of Contents~~

Oglethorpe adopted Staff Position No. 157-4, "Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly" ("FSP 157-4") effective June 30, 2009. FSP 157-4 emphasizes that even if there has been a significant decrease in the volume and level of activity for the asset or liability and regardless of the valuation technique and inputs used, the objective for the fair value measurement is unchanged from what it would be if markets were operating at normal activity levels or transactions were orderly; that is, to determine the current exit price. The adoption of FSP 157-4 did not have a material effect on Oglethorpe's results of operations, cash flows or financial condition.

Oglethorpe adopted FSP FAS 107-1 and APB 28-1, "Interim Disclosures about Fair Value of Financial Instruments" ("FSP FAS 107-1 and APB 28-1") effective June 30, 2009. FSP FAS 107-1 and APB 28-1 require disclosures about fair value of financial instruments in interim and annual financial statements. The adoption of FSP 107-1 and APB 28-1 did not have a material effect on Oglethorpe's results of operations, cash flows or financial condition.

(E): Accumulated Comprehensive Deficit. The table below provides detail of the beginning and ending balance for each classification of accumulated other comprehensive deficit along with the amount of any reclassification adjustments included in margin for each of the periods presented in the Condensed Statements of Patronage Capital and Membership Fees and Accumulated Other

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Comprehensive Deficit. There were no material changes in the nature, timing or amounts of expected (gain) loss reclassified to net margin from the amounts disclosed in Oglethorpe's ~~Annual Report on~~2008 Form ~~10-K for the fiscal year ended December 31, 2008.~~

10-K.

Oglethorpe's effective tax rate is zero; therefore, all amounts below are presented net of tax.

Accumulated Other Comprehensive Deficit

(dollars in thousands)

Interest Rate
Swap Arrangements

Available-for-sale
Securities

Total

Balance at December 31, 2007
$ (32,806 ) $ 115 $ (32,691 )

Unrealized gain/(loss)

—
(4,527
)
(4,527
)
Realized deferred loss

32,806
—
32,806

Balance at June 30, 2008

$
—
$
(4,412
)
$
(4,412
)

Balance at December 31, 2008

$
—
$
(1,348
)
$
(1,348
)

Unrealized gain/(loss)

—
(79
)
(79
)

Balance at June 30, 2009

$
—
$
(1,427
)
$
(1,427
)


	Accumulated Other Comprehensive Deficit
		(dollars in thousands)
		Interest Rate Swap Arrangements			Available-for-sale Securities			Total

Balance at December 31, 2007	$	(32,806	)	$	115		$	(32,691	)

Unrealized gain/(loss)		—			(5,209	)		(5,209	)
Realized deferred loss		32,806			—			32,806

Balance at September 30, 2008	$	—		$	(5,094	)	$	(5,094	)

Balance at December 31, 2008	$	—		$	(1,348	)	$	(1,348	)

Unrealized gain/(loss)		—			263			263

Balance at September 30, 2009	$	—		$	(1,085	)	$	(1,085	)

(F): Environmental Matters. There are a number of environmental matters that could have an effect on Oglethorpe's financial condition or results of operations. At this time, the resolution of these matters is uncertain, and Oglethorpe has made no accruals for such contingencies and cannot reasonably estimate the possible loss or range of loss with respect to these matters.

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As is typical for electric utilities, Oglethorpe is subject to various federal, state and local air and water quality requirements which, among other things, regulate emissions of pollutants, such as particulate matter, sulfur dioxide, nitrogen oxides and mercury into the air and discharges of other pollutants, including heat, into waters of the United States. Oglethorpe is also subject to federal, state and local waste disposal requirements that regulate the manner of transportation, storage and disposal of various types of waste.

In general, environmental requirements are becoming increasingly stringent. New requirements may substantially increase the cost of electric service by requiring changes in the design or operation of existing facilities or changes or delays in the location, design, construction or operation of new facilities. Failure to comply with these requirements could result in the imposition of civil and criminal penalties as well as the complete shutdown of individual generating units not in compliance. Certain of Oglethorpe's debt instruments require usit to comply in all material respects with laws, rules, regulations and orders imposed by applicable governmental authorities, which include current or future environmental laws and regulations. Should weOglethorpe fail to be in compliance with these requirements, it would constitute a default under such debt instruments. Although it is Oglethorpe's intent to comply with current and future regulations, Oglethorpe cannot provide assurance that it will always be in compliance with current and future regulations applicable to it.

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(G): ~~Pollution Control Revenue Bonds (PCBs).~~ In the second half of 2007, the three major credit rating agencies began an on-going review of the monoline bond insurers primarily as a result of the exposure some insurers had to financial guarantees and credit default swaps related to structured finance obligations, primarily those backed by subprime residential mortgages. By mid-2008, many monoline bond insurers had been downgraded below their historical triple-A rating levels or had negative outlooks assigned to their triple-A ratings, including the insurers that provided guarantees on a significant portion of Oglethorpe's variable rate PCB indebtedness.

These bond insurer downgrades caused a corresponding downgrade of the ratings on the insured bonds, leading to increased focus on the underlying issuer credit, wider credit spreads and higher interest rates, and in many cases failed auctions in the auction rate securities (ARS) market and failed remarketings in the variable rate demand bond (VRDB) market. The ARS market is no longer functioning as originally anticipated, and investors are trying to liquidate ARS investments as expeditiously as they can. Activity in the VRDB market was significantly curtailed throughout 2008 as well.

The bond insurer downgrades and related issues in the ARS market required Oglethorpe to refinance, or otherwise convert to a term or fixed rate of interest, approximately $819,000,000 of variable rate PCBs in 2008 (of which Georgia Transmission Corporation (GTC) has assumed an $94,000,000 obligation).

At June 30, 2009, Oglethorpe had $123,000,000 of PCBs in the ARS mode that remained outstanding. These ARS reprice in Dutch auctions that occur every 35 days, but the auctions have been failing consistently since early 2008 for the reasons described above. However, because the interest rates on the ARS have reset at 125% to 150% of LIBOR (as determined by the rating on the bonds and pursuant to procedures governing failed auctions) the interest rates on the ARS have been below 1% since January 2009.

~~(H)~~: Restricted short-term investments. At ~~June~~September 30, 2009, Oglethorpe had ~~$80,756,000~~$39,738,000 on deposit with ~~Rural Utilities Service (RUS)~~RUS in the Cushion of Credit Account. The funds are ~~restricted~~to be used for future RUS/Federal Financing Bank (FFB) debt service payments and earn interest at a RUS guaranteed rate of 5% per annum.

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~~(I)~~(H): Members' Advances. In December 2008, Oglethorpe instituted a power bill prepayment program pursuant to which Members can prepay their power bills from Oglethorpe at a discount ~~for an agreed number~~based on Oglethorpe's avoided cost of ~~months in advance, after which point the funds~~funds. The advances are credited against the participating Members' ~~monthly~~ power ~~bills.~~bills in the month(s) agreed upon in advance. The discounts are credited each and every month against the power bills and are recorded on Oglethorpe's books as a reduction to Member revenues. At ~~June~~September 30, 2009, Member advances as reflected on the balance sheet, including unpaid discounts, were ~~$185,752,000,~~$194,047,000, of which, ~~$154,109,000~~$183,047,000 is classified as current liabilities and ~~$31,643,000~~$11,000,000 as deferred credits and other liabilities in the condensed balance sheets. ~~In addition,~~Subsequent to September 30, 2009, Oglethorpe ~~has~~ received an additional ~~$7,500,000~~$2,000,000 from Members ~~in relation to~~under this ~~program, subsequent to June 30, 2009. These amounts~~program. The advances are being applied against Members' power bills ~~extending~~ through September 2013, with the majority scheduled to be applied in 2010.
~~(J)~~: ~~Rocky Mountain Lease Arrangements.~~

~~Relationship with AIG Matched Funding Corp.~~ ~~In connection with the transactions described under the caption "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS—Financial Condition—~~~~Off-Balance Sheet Arrangements—Rocky Mountain Lease Arrangements~~" in Oglethorpe's Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (such transactions being referred to collectively herein as the "Rocky Mountain Lease Arrangements"), Oglethorpe's wholly owned subsidiary, Rocky Mountain Leasing Corporation (RMLC), is required to enter into and maintain an arrangement pursuant to which a third party meeting certain minimum credit rating requirements agrees to make payments sufficient to fund the equity portion of the fixed purchase price of the undivided interests in the Rocky Mountain Pumped Storage Hydroelectric Facility (Rocky Mountain) that RMLC leases from the six Owner Trusts (the "Trusts") formed to effectuate the Rocky Mountain Leasing Arrangements, if Oglethorpe causes RMLC to exercise its option to purchase these interests when the leases expire in 2027. Consequently, RMLC entered into six Equity Funding Agreements with AIG Matched Funding Corp. (collectively, the "AIG Equity Funding Agreements"), which is a wholly owned subsidiary of American International Group, Inc. (AIG), concurrently with the consummation of the Rocky Mountain Lease Arrangements. AIG has guaranteed the obligations of AIG Matched Funding Corp. under the AIG Equity Funding Agreements.

Pursuant to the AIG Equity Funding Agreements, RMLC deposited $57,000,000 with AIG Matched Funding Corp. that was invested in six guaranteed investment contracts that will increase in value during the term of the lease, and at the end of the lease term will have a value equal to the equity portion of the fixed purchase price, or $372,000,000. These investments are reflected on Oglethorpe's condensed unaudited balance sheets as "Deposit on Rocky Mountain transactions", with a balance of $111,868,000 at June 30, 2009.

The operative agreements relating to the Rocky Mountain Lease Arrangements provide that if AIG fails to maintain a credit rating of at least Aa3 from Moody's and AA- from S&P, then AIG Matched Funding Corp. will be required to post collateral having a stipulated credit quality to secure its obligations under the AIG Equity Funding Agreements. Moreover, if AIG fails to maintain a credit rating of at least Baa3 from Moody's and BBB- from S&P, then RMLC must, within 60 days of becoming aware of such fact, enter into replacement Equity Funding Agreements with a financial institution that has credit ratings of at least Aa2 from Moody's and AA from S&P. In the event that RMLC were not able to enter into replacement Equity Funding Agreements, then RMLC may be required to purchase the Trusts' equity interests from the owners thereof.

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purchase price (the "Collateral Requirement"). In accordance with the terms of the AIG Equity Funding Agreements, the market value of the posted collateral (other than cash) will be determined weekly by an independent third party and AIG Matched Funding Corp. will be required to post additional collateral to the extent that it is determined that the market value of such collateral, together with the cash collateral (if any), has fallen below the Collateral Requirement. According to U.S. Bank National Association, which as collateral agent holds the collateral and provides the weekly valuation thereof, the market value of the collateral was approximately $118,768,000 at June 30, 2009.

~~Relationship with AMBAC Assurance Corporation.~~ In addition, the operative agreements relating to the Rocky Mountain Lease Arrangements require Oglethorpe to maintain surety bonds with a surety bond provider that meets minimum credit rating requirements to secure certain of Oglethorpe's payment obligations under the Rocky Mountain Lease Arrangements. Accordingly, Oglethorpe entered into a surety bond arrangement with AMBAC Indemnity Corporation (now known as AMBAC Assurance Corporation) (AMBAC) concurrently with the consummation of the Rocky Mountain Lease Arrangements.

The operative agreements provide that if the surety bond provider fails to maintain a credit rating of at least AA from S&P or Aa2 from Moody's, then Oglethorpe must, within 60 days of becoming aware of such fact, provide (i) a replacement surety bond from a surety bond provider that has such credit ratings, (ii) a letter of credit from a bank with such credit ratings, (iii) other acceptable credit enhancement or (iv) any combination thereof.

On November 19, 2008, S&P lowered AMBAC's credit rating from AA to A. Because AMBAC already had a credit rating of Baa1 from Moody's, such action by S&P triggered the requirement for Oglethorpe to provide the replacement credit enhancement discussed above. Each of the three equity investors (owner participants) in the lease have granted Oglethorpe extensions of time to provide this replacement credit enhancement.

As discussed in Oglethorpe's Form 8-K dated as of the same date, on May 22, 2009, Oglethorpe entered into an agreement with Berkshire Hathaway Assurance Corporation (Berkshire), rated AAA by S&P and Aa1 by Moody's, pursuant to which Berkshire provided supplemental credit enhancement to the credit enhancement currently provided by AMBAC with respect to five of the six long-term lease transactions, representing two of the three equity investors. As a result, Oglethorpe's obligation to provide replacement credit enhancement with respect to these five long-term lease transactions has been satisfied.

In addition, in late August 2009, Oglethorpe expects to enter into an agreement with Berkshire for Berkshire to provide supplemental credit enhancement to the credit enhancement currently provided by AMBAC with respect to the sixth long-term lease transaction, representing the third equity investor. However, in the event that Oglethorpe is unable to implement this supplemental credit enhancement within any additional time extensions granted by the investor in the owner trust formed to effectuate the sixth long-term lease transaction, then it may be required to purchase the equity interest of this investor in the owner trust. Oglethorpe currently estimates that the maximum aggregate amount of exposure it would have if it were required to purchase this equity interest is approximately $25,000,000. This amount is net of the accreted value of the guaranteed investment contract that was entered into with AIG Matched Funding Corp. in connection with the sixth long-term lease transaction. The actual value of the guaranteed investment contract may be more or less than the accreted value as a result of changes in interest rates and market conditions. Oglethorpe expects to have adequate liquidity to purchase the equity interest based on the maximum aggregate amount of exposure of approximately $25,000,000, if it were required to do so.

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~~(K)~~(I): Heard County Power Acquisition. On May 1, 2009, Oglethorpe acquired 100% of Heard County Power, L.L.C. (Heard LLC) pursuant to a purchase and sale agreement dated February 25, 2009. Heard LLC owns the Hawk Road Energy Facility, a 500 megawatt natural gas-fired peaking facility, located in Heard County. In conjunction with the acquisition, Oglethorpe assumed a power purchase and sale agreement under which it sells 500 megawatts of capacity and associated energy to seven of its Members through December 31, 2015. After 2015, the output of the Hawk Road Energy Facility will be available to all of ~~our~~Oglethorpe's subscribing ~~members.~~Members. The transaction was valued at approximately $203,100,000, which represented a purchase price of $105,000,000 and an approximate $98,100,000 liability for the assumed power purchase and sale agreement which together with acquisition related costs and payments of approximately $900,000 (consisting primarily of legal and professional services) resulted in an approximate cash outlay of $105,900,000. The acquisition related costs of $900,000 were expensed in the second quarter of 2009.

In connection with the acquisition, Oglethorpe funded the entire $105,900,000 cash outlay by issuing commercial paper.

The following amounts represent the preliminary estimates of identifiable assets acquired and liabilities assumed in the Heard LLC acquisition:

(in millions)

Recognized fair value amounts of identifiable assets acquired and liabilities assumed:
Property, plant and equipment $ 202.7
Inventory 0.5

Current liabilities

(0.1
)
Liability for power purchase and sale agreement (98.1 )

Total identifiable net assets $ 105.0



Recognized fair value amounts of identifiable assets acquired and liabilities assumed:		(in millions)

Property, plant and equipment	$	202.7
Inventory		0.5
Current liabilities		(0.1	)
Liability for power purchase and sale agreement		(98.1	)

Total identifiable net assets	$	105.0

There was no goodwill or gain on bargain purchase associated with this acquisition.

The assets acquired and liabilities assumed of Heard LLC have been measured in accordance with ~~SFAS No. 141(R), "Business Combinations"~~authoritative guidance regarding Business Combinations as of the acquisition date. For purposes of measuring fair value, where applicable, Oglethorpe has used ~~the~~Fair Value Measurements guidance, ~~of SFAS No. 157 "Fair Value Measurements",~~ which establishes a framework for measuring fair values. Liabilities arising from the power purchase and sale agreement were evaluated in accordance with ~~FASB Staff Position No. FAS 141(R)-1, "Accounting~~Accounting for Assets Acquired

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and Liabilities Assumed in a Business Acquisition That Arise from ~~Contingencies" (FSP FAS 141(R)-1) resulting~~Contingencies and resulted in the recognition of a $98,100,000 liability for athe power purchase and sale agreement acquired as part of the acquisition. This liability was valued using a discounted cash flow methodology.

Heard LLC's financial position and results of operations have been consolidated with Oglethorpe as of May 1, 2009 and contributed revenues to Oglethorpe for the period May 1, 2009 through ~~June~~September 30, 2009 of ~~$1.0~~$2,638,000 million. The effects on net margin are being deferred until the end of the power purchase and sale agreement in 2015 and then amortized over the remaining life of the plant. ~~The following unaudited supplemental pro forma data presents consolidated information of~~

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~~Oglethorpe as if the acquisition of Heard LLC had been consummated on January 1 of the respective year.~~

Pro forma
Six Months Ended
June 30, 2009 Pro forma
Six Months Ended
June 30, 2008

(in thousands)
Operating Revenues
$ 584,947 $ 613,553
Net Margin
$ 28,456 $ 15,485

~~The pro forma amounts contain the following:~~

•: ~~Capacity revenues per the existing purchase power agreement~~
•: ~~Additional depreciation and amortization expense that would have been charged assuming the fair value adjustments to property, plant and equipment had been applied from January 1, 2008.~~
•: ~~Additional interest expense that would have been incurred assuming all borrowing arrangements used to fund the acquisition had been in place as of January 1, 2008.~~
•: ~~The difference between actual loss on power purchase and sale agreement and discounted cash flow liability recorded.~~

~~As discussed previously, the net margin effects of this acquisition are being deferred until 2015; accordingly, there is no net margin impact of this acquisition.~~

~~(L)~~(J): Subsequent Events. In accordance with ~~SFAS No. 165,~~the Codification, Oglethorpe evaluated subsequent events up until the time that its financial statements were issued and filed with the SEC on ~~August~~November 12, 2009.

On ~~July 31,~~October 13, 2009, Oglethorpe ~~notified the partners~~acquired 100% of ~~the~~ Hartwell Energy Limited Partnership (HELP) ~~of Oglethorpe's intent to purchase HELP,~~, which owns the 300 megawatt Hartwell plant, an oil and gas-fired peaking facility with two 150 megawatt combustion turbine generating units in northeast Georgia. The purchase price iswas $148,500,000, ~~including~~which included approximately ~~$54,000,000~~$53,500,000 of existing project level debt ~~plus a working capital and fuel oil adjustment to be determined~~paid off at closing. ~~Completion~~Oglethorpe acquired as part of the ~~purchase is expected in the third quarter~~acquisition of ~~2009.~~

~~Oglethorpe already has a~~HELP an existing power purchase ~~arrangement~~agreement that Oglethorpe had with ~~HELP to purchase~~HELP.

On November 3, 2009, Oglethorpe issued $400,000,000 of First Mortgage Bonds, Series 2009 B (the Bonds). The Bonds bear interest at 5.95% per year, with interest payment dates on May 1 and November 1 of each year, beginning on May 1, 2010, and have a final maturity of November 1, 2039. In connection with the ~~output~~issuance of the ~~plant through May 2019 under~~Bonds, Oglethorpe entered into a registration rights agreement pursuant to which it ~~has~~agreed to file a ~~right of first refusal~~registration statement relating to ~~purchase the facility. See "BUSINESS—OGLETHORPE'S POWER SUPPLY RESOURCES—Power Purchase and Sale Agreements—~~~~Power Purchase~~~~," in Oglethorpe's Annual Report on Form 10-K~~an exchange offer for the ~~fiscal year ended December 31, 2008.~~

~~The purchase of~~Bonds and/or, if applicable, to file a shelf registration statement for the ~~plant by Oglethorpe will be subject to applicable regulatory approvals and lender consent.~~Bonds.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

General

Oglethorpe Power Corporation (Oglethorpe) is a power supply cooperative owned by 38 retail electric distribution cooperative members (the Members). The Members are consumer-owned distribution cooperatives providing retail electric service in Georgia on a not-for-profit basis. Oglethorpe's principal business is providing wholesale electric power to the Members through a combination of its generation assets and power purchased from power marketers and other suppliers. As with cooperatives generally, Oglethorpe operates on a not-for-profit basis.

Forward-Looking Statements and Associated Risks

This Quarterly Report on Form 10-Q contains forward-looking statements, including statements regarding, among other items, (i) anticipated financing transactions by Oglethorpe, (ii) Oglethorpe's future capital expenditure requirements and funding sources ~~of capital~~ and (iii) achievement of a Margins for Interest Ratio (MFI Ratio) at or above the minimum requirement contained in Oglethorpe's Mortgage Indenture and, ~~approved by~~in the case that Oglethorpe's Board of ~~Directors.~~Directors approves a budget for a particular fiscal year that seeks to achieve a higher MFI Ratio, such higher Board-approved MFI Ratio. These forward-looking statements are based largely on Oglethorpe's current expectations and are subject to a number of risks and uncertainties, some of which are beyond Oglethorpe's control. For a discussion of some factors that could cause actual results to differ materially from those anticipated by these forward-looking statements, see ~~"Financial Condition—Capital Requirements and Liquidity and Sources of Capital—~~~~Current Financial Market Conditions~~~~" herein and~~ Item ~~1A-Risk~~1A—Risk Factors contained in ~~Oglethorpe's Annual~~this Quarterly Report on Form ~~10-K for the fiscal year ended December 31, 2008.~~10-Q. In light of these risks and uncertainties, there can be no assurance that events anticipated by the forward-looking statements contained in this Quarterly Report on Form 10-Q will in fact transpire.

Results of Operations

For the Three and ~~Six~~Nine Months Ended ~~June~~September 30, 2009 and 2008

Net Margin

Throughout the year, Oglethorpe monitors its ~~financial~~operating results and, with Board approval, makes budget adjustments when and as necessary to ensure its targeted ~~net margin~~MFI Ratio is achieved. Under the Mortgage Indenture, Oglethorpe is required to establish and collect rates that are reasonably expected, together with other revenues of Oglethorpe, to yield a MFI Ratio of at least 1.10 in each fiscal year. Oglethorpe has achieved the minimum 1.10 MFI Ratio every year since 1997, which is the year that the MFI Ratio requirement ~~became effective.~~came into effect. Moreover, to enhance financial coverage during an anticipated period of generation facility construction, Oglethorpe's Board approved a budget for 2009 that will achieve a 1.12 MFI Ratio, and Oglethorpe anticipates a margin of approximately $26.7 million for the year ending December 31, 2009 at this level of MFI coverage. Oglethorpe previously disclosed that it will evaluate coverage ratios during the period of anticipated construction and may choose to increase or decrease MFI coverage in the future. In this regard,Ratio. For 2010, Oglethorpe's Board has approved ~~a further~~an increase in the MFI Ratio to ~~a level of 1.14, effective in 2010.~~1.14. The Board will continue to evaluate coverage ratios throughout the period of anticipated construction and may choose to increase or decrease the MFI ~~coverage~~Ratio in the future.

Oglethorpe's net margin for the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 was ~~$12.8~~$11.4 million and ~~$28.5~~$39.8 million compared to ~~$8.8~~$5.6 million and ~~$15.5~~$21.1 million for the same periods of 2008. The increase in net margin for the ~~current~~2009 three- and ~~six-month~~nine-month periods compared to the same periods of 2008 was due primarily ~~due~~ to total interest ~~expense on long-term debt~~charges being lower than budgeted during ~~2009. In addition, higher budgeted net margin for~~ 2009 ~~due~~and, to a lesser extent, the increase in the MFI ~~ratio also contributed~~Ratio to ~~the increase in net margin~~1.12 for 2009, as compared to 1.10 for 2008. Oglethorpe expects a net margin of approximately $26.2 million for the year ending December 31, 2009 which will achieve the target 1.12 MFI Ratio.

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Operating Revenues

Oglethorpe's operating revenues fluctuate from period to period based on factors including weather and other seasonal factors, load growth in the service territories of its Members, operating costs, availability of electric generation resources, Oglethorpe's decisions of whether to dispatch its owned or purchased resources or Member-owned resources over which it has dispatch rights, and by Members' decisions of whether to purchase a portion of their hourly energy requirements from Oglethorpe's resources or from other suppliers.

Total revenues from sales to Members were ~~5.8%~~7.6% and ~~4.6%~~5.7% lower in the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 than ~~such revenues~~ for the same periods of 2008. Megawatt-hour (MWh) sales to Members decreased ~~12.4%~~11.0% and 11.1% in the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 versus the same periods of 2008. The average total revenue per MWh from sales to Members increased ~~7.5%~~3.9% and ~~7.3%~~6.1% for the ~~current~~three- and nine-month periods ofended September 30, 2009 compared to the same periods of 2008.

The components of Member revenues for the three and ~~six~~nine months ended ~~June~~September 30, 2009 and 2008 were as follows (amounts in thousands except for cents per kilowatt hour):

Three Months
Ended June 30, Six Months
Ended June 30,
2009 2008 2009 2008
Capacity revenues
$ 165,197 $ 150,000 $ 329,160 $ 300,478
Energy revenues
135,330 169,045 253,072 309,877

Total
$ 300,527 $ 319,045 $ 582,232 $ 610,355

Kilowatt hours sold to Members
5,181,861 5,913,146 10,013,239 11,262,060
Cents per kilowatt hour
5.80¢ 5.40¢ 5.81¢ 5.42¢



	Three Months Ended September 30,				Nine Months Ended September 30,
	2009		2008		2009		2008
Capacity revenues	$	166,527	$	150,013	$	495,687	$	450,491
Energy revenues		141,887		183,712		394,959		493,589

Total	$	308,414	$	333,725	$	890,646	$	944,080

Kilowatt hours sold to Members		5,576,812		6,267,594		15,590,051		17,529,654
Cents per kilowatt hour		5.53¢		5.32¢		5.71¢		5.39¢

Capacity revenues for the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 increased ~~10.1%~~11.0% and ~~9.5%~~10.0% compared to the same periods of 2008. The increase in capacity revenues in 2009 primarily resulted from higher budgeted interest expense on long-term debt relating to ~~an expected increase in debt levels resulting from generation facility construction.~~environmental expenditures for existing coal-fired facilities that have now been placed in-service and to provide liquidity for general corporate purposes. In addition, ~~higher net margins~~capacity revenues also increased in 2009 due to an increase in the target MFI Ratio to 1.12 in 2009 compared to ~~the target MFI Ratio of~~ 1.10 in ~~2008 and the resulting impact of such increase on the higher budgeted interest expense for 2009 contributed to the increase in capacity revenues in such periods.~~2008. Energy revenues were ~~19.9%~~22.8% and ~~18.3%~~20.0% lower for the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 compared to the same periods of 2008. Oglethorpe's average energy revenue per MWh from sales to Members was ~~8.6%~~13.2% and ~~8.1%~~10.0% lower for the ~~current periods of~~three and nine month ended September 30, 2009 as compared to the same periods of 2008. The decrease in energy revenues for the ~~three- and six-month periods~~three-month period ended ~~June~~September 30, 2009 compared to the same ~~periods~~period of 2008 was primarily due to the pass-through to Oglethorpe's Members of lower fuel costs (primarily due to lower coal-fired generation) ~~and~~. For the nine-month period ended September 30, 2009 compared to the same period of 2008, in addition to lower fuel costs, the pass-through of lower purchased power energy costs (primarily due to the lower volume of purchased MWhs). contributed to the decrease as well. For a discussion of fuel costs and purchased power costs, see "Operating Expenses" below.

Operating Expenses

Operating expenses for the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 decreased ~~10.0%~~13.2% and ~~9.0%~~10.5% compared to the same periods of 2008. The decrease in operating expenses for the ~~three and six months ended June 30,~~third quarter of 2009 compared to the same ~~periods~~period of 2008 was primarily due to lower fuel costs offset somewhat by higher depreciation expense. For the first nine months of 2009 compared to the same period of 2008, the decrease in operating expenses was primarily due to lower fuel costs and lower purchased power ~~costs. This decrease was~~costs; offset somewhat by an increase in depreciation expense.

For the three- and six-month periods ended June 30, 2009 compared to the same periods of 2008, total fuel costs decreased 17.8% and 14.5% while total generation decreased 9.4% and 8.5%, respectively. Average fuel costs per MWh decreased 9.2% and 6.5% in the current periods of 2009 compared to the

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For the three- and nine-month periods ended September 30, 2009, total fuel costs decreased 30.3% and 20.5% and total generation decreased 7.3% and 8.0% as compared to the same periods of 2008. Average fuel costs per MWh decreased 24.9% and 13.6% in the third quarter and first nine months of 2009 compared to the same periods of 2008. The decrease in total fuel costs during the ~~second~~third quarter of and year-to-date of 2009 compared to the same periods of 2008 resulted primarily from lower coal-fired generation at Plants Scherer and Wansley, offset somewhat by higher generation at the natural gas-fired Chattahoochee energy facility. The decrease in average fuel costs during the three and ~~six~~nine months ended ~~June~~September 30, 2009 compared to the same periods of 2008 resulted primarily from a ~~23.6%~~19.2% and ~~26.2%~~23.8% decrease in generation at Plants Scherer and Wansley due to scheduled outages at both of these plants ~~whereas last year there was only~~compared to a scheduled outage at only Plant ~~Wansley.~~Wansley in 2008. In addition, Plant Wansley was dispatched less in 2009 than in 2008 due to unfavorable fuel costs relative to other available resources. Natural gas-fired generation at Chattahoochee increased ~~141.3%~~3.7% or ~~373,000~~20,000 MWhs and ~~129.1%~~66.4% or ~~692,000~~712,000 MWhs for the third quarter and nine months of 2009 as compared to same periods of 2008 primarily due to a substantial decline in the price of natural ~~gas; the~~gas. The average fuel cost per MWh of natural gas-fired generation at Chattahoochee decreased ~~68.6%~~61.3% and ~~60.4%, respectively,~~59.3% in the ~~three- and six-month~~three-and nine-month periods ended ~~June~~September 30, 2009 from levels in the same periods a year ago.

Total purchased power costs increased 3.0% and decreased ~~21.0% and 25.5%~~15.5% for the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 compared to the same periods of 2008. Purchased MWhs decreased ~~43.8%~~54.1% and ~~51.8%~~52.6% for the ~~current~~three and nine-month periods of 2009 compared to the same periods of 2008. The average cost per MWh of total purchased power increased ~~40.6%~~124.4% and ~~54.4%~~78.3% for the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 compared to the same periods of 2008.

Purchased power costs were as follows (amounts in thousands except for cents per kilowatt hour):

Three Months
Ended June 30, Six Months
Ended June 30,
2009 2008 2009 2008
Capacity costs
$ 11,024 $ 10,478 $ 21,707 $ 20,697
Energy costs
23,026 32,623 37,489 58,802

Total
$ 34,050 $ 43,101 $ 59,196 $ 79,499

Kilowatt hours of purchased power
268,977 478,648 414,945 860,612
Cents per kilowatt hour
12.66¢ 9.00¢ 14.30¢ 9.24¢



	Three Months Ended September 30,				Nine Months Ended September 30,
	2009		2008		2009		2008
Capacity costs	$	11,407	$	10,833	$	33,114	$	31,530
Energy costs		32,942		32,215		70,431		91,017

Total	$	44,349	$	43,048	$	103,545	$	122,547

Kilowatt hours of purchased power		220,306		479,783		635,251		1,340,395
Cents per kilowatt hour		20.13¢		8.97¢		16.30¢		9.14¢

Purchased power capacity costs remained relatively unchanged in the three- and ~~six-month~~nine-month periods of 2009 compared to the same periods of 2008. Purchased power energy costs for the ~~three~~three- and ~~six months~~nine-month periods ended ~~June~~September 30, 2009 increased 2.3% and decreased ~~29.4% and 36.2%~~22.6% compared to the same periods of 2008. The average cost of purchased power energy increased ~~25.6%~~122.7% and ~~32.2%~~63.3% for the three and ~~six~~nine months ended ~~June~~September 30, 2009 compared to the same periods of 2008. ~~The decreases~~Changes in purchased power energy costs, volume of MWhs acquired and average cost per MWh were affected by the following items: (1) reduction in ~~the~~purchased power energy costs from lower volume of purchased MWhs along with the increase in the cost per MWh purchased were all primarily due to the expiration of the Morgan Stanley purchased power agreement effective December 31, ~~2008. In addition,~~2008, (2) a ~~significant drop in the~~lower average price per MWh ~~acquired~~realized under Oglethorpe's energy replacement program ~~(volume of MWhs acquired increased slightly in 2009 compared to 2008),~~ which replaces power from Oglethorpe owned generation facilities with lower price spot market purchased power energy contributed to the ~~decreases in~~reduction of purchased power energy costs and offset somewhat the increase in the average cost of purchased power ~~energy. These decreases in purchased power~~ energy, ~~costs were offset somewhat by~~and (3) realized losses incurred in 2009 for natural gas ~~financial contracts~~swap agreements utilized by Oglethorpe for managing exposure to fluctuations in the market price of natural gas. The realized losses related to the natural gas swaps during the third quarter of 2009 more than offset the reduction in purchased power energy costs discussed in (1) and (2) above, while the realized

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losses related to natural gas swaps for the first nine months of 2009 only somewhat offset purchased power energy costs.

Depreciation expense increased ~~10.1%~~14.7% and ~~7.0%~~9.6% in the three- and ~~six-month~~nine-month periods of 2009 as compared to same periods of ~~2008~~2008. The increases were primarily due to ~~an increase in~~increased depreciation expense for ~~Plant~~Plants Scherer and Wansley related to capital expenditures for environmental compliance projects.

~~Table~~ Also, depreciation expense related to the recently acquired (May 2009) Hawk Road Energy Facility contributed to the increases. For information regarding the Hawk Road Energy Facility, see Note I of ~~Contents~~Notes to Unaudited Condensed Financial Statements.

Other Income

Investment income increased ~~9.4%~~15.5% and ~~decreased 3.8%~~2.0% in the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 compared to the same periods of 2008. The increase in investment income in the ~~second~~third quarter of 2009 as compared to the same period of 2008 is partly due to an increase in interest earnings on cash and cash equivalent investments due to higher cash balances offset somewhat by lower market interest rates on those ~~investments. The second quarter 2009 increase is also attributable~~investments, to increased earnings on the RUS Cushion of Credit Account due to higher balances in such account ~~compared to the same quarter of 2008.~~and from nuclear decommissioning trust funds income as discussed below.

The line item investment income includes activity in the decommissioning trust funds. The income (loss) from investments in Oglethorpe's external and internal decommissioning funds for the three- and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 totaled ~~($7.2)~~$3.1 million and ($~~10.5)~~7.5) million compared to ($~~1.4)~~0.3) million and ~~$1.5~~$1.2 million for the same periods of 2008. For nuclear decommissioning, Oglethorpe records a regulatory asset or liability for the timing difference in accretion expense recognized under ~~SFAS No. 143,~~FASB guidance, "Accounting for Asset Retirement Obligations," compared to the expense recovered for ratemaking purposes. The adjustments to investment income for these timing differences resulted in increases to the regulatory asset of ~~$11.7~~$1.4 million and ~~$19.4~~$20.8 million for the three-and ~~six-month~~nine-month periods ended ~~June~~September 30, 2009 compared to increases of ~~$5.5~~$4.4 million and ~~$6.9~~$11.3 million for the same periods of 2008. Additionally, a ~~$22.1~~$47.1 million increase in the fair market value of the nuclear decommissioning fund contributed to the slight decrease in the regulatory asset at ~~June~~September 30, 2009.

A new decommissioning site study is underway and an analysis of funding adequacy will be ~~performed later in 2009.~~undertaken once the site study has been completed. The combination of the results of ~~the decommissioning site study along with investment returns during 2009~~these two studies will be utilized to ~~assess~~evaluate whether ~~additional decommissioning collections~~or not Oglethorpe should resume collecting funds from its Members ~~will be required in future years.~~for nuclear decommissioning. Oglethorpe's management believes that ~~any increase in the cost estimates of decommissioning or decline in investment earnings can~~should resumption be warranted, it is probable that such amounts will be recovered in future rates.

Interest charges

Interest on long-term debt and capital leases increased by 10.3% and 7.6% in the three- and nine-month periods ended September 30, 2009 compared to the same periods of 2008. These increases were primarily due to the issuance in February 2009 of $350 million in taxable fixed rate bonds for the purpose of financing environmental expenditures for existing coal-fired facilities and to provide liquidity for general corporate purposes.

Allowance for debt funds used during construction increased by 23.1% and 49.4% in the three- and nine-month periods ended September 30, 2009 compared to the same periods of 2008 primarily due to construction expenditures for Plant Vogtle Units No. 3 and No. 4.

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Balance Sheet Analysis as of ~~June~~September 30, 2009

Assets

Nuclear fuel, which is recorded at amortized cost, increased by $18.6 million in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008. The increase was due to a combination of factors including the timing of expenditures, the costs of uranium and fabrication, and the amount of amortization (fuel burn) recorded.

Construction work in progress increased by a net ~~$110.8~~$193.8 million in the ~~six-month~~nine-month period ended ~~June~~September 30, 2009 compared to the fiscal year ended December 31, 2008, primarily due to approximately $240 million of costs ~~incurred~~recorded for the construction of two new nuclear units at the existing Plant Vogtle. ~~Construction~~Costs recorded in connection with the planning and construction of the biomass facilities also increased by approximately $7 million during the first three quarters of 2009. These increases were somewhat offset by a decrease in construction work in progress for various replacement and improvement projects (including environmental control systems) ~~decreased somewhat~~ as a result of certain projects being placed in service.

The $33.7 million increase in the value of the nuclear decommissioning trust fund in the nine-month period ended September 30, 2009 was largely due to a $33.5 million increase in the value of the fund's unrealized gain since December 31, 2008.

Primarily as a result of a $10.0 million investment made in the National Rural Utilities Cooperative Finance Corporation's (CFC) Member Capital Securities program, investment in associated companies increased by ~~$10.1 million.~~$8.9 million in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008. Somewhat offsetting this increase were payments and reclassifications of current amounts to accounts receivable that were related to certain loans made to an associated company.

Cash and cash equivalents increased by ~~$214.6~~$303.0 million in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008 largely as a result of proceeds received from the issuance of new long-term debt, an increase in short-term borrowings and cash from operations, which includes funds received from certain Members for prepayment of their monthly power bills. ~~Portions~~Significant uses of ~~the funds were used for~~cash include principal and interest payments, property additions and payments to Georgia Power Company (GPC) for ~~operations~~operation and maintenance costs. In addition, approximately $105 million of cash was used for the acquisition of the Hawk Road Energy Facility. For information regarding the power bill prepayment program and the Hawk Road Energy Facility, see Notes IH and ~~K, respectively~~I of Notes to Unaudited Condensed Financial Statements.

Cash paid for property additions (excluding the Hawk Road Energy Facility) for the nine-month period ended ~~June~~September 30, 2009 totaled ~~$270~~$454.3 million. Of this amount approximately ~~$120~~$248 million was for expenditures associated with the construction of new generation facilities. The remaining expenditures were primarily for environmental control systems being installed at Oglethorpe's coal-fired generation plants, nuclear

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fuel, and normal additions and replacements to existing generation facilities. ~~For information regarding the Hawk Road Energy Facility, see Note K of Notes to Unaudited Condensed Financial Statements.~~

~~Restricted~~The restricted cash balance at December 31, 2008 represented a portion of the proceeds obtained from the December 2008 refinancing transactions. These proceeds, which were on deposit with a trustee, were subsequently used in the first quarter of 2009 to pay principal related to ~~PCB debt~~Pollution Control Revenue Bonds (PCBs) that matured in January 2009.

Restricted short-term investments ~~represent~~at September 30, 2009 represented funds deposited into a RUS Cushion of Credit Account with the U.S. Treasury that earns interest at a guaranteed rate of 5% per annum. The funds, including interest earned thereon, can only be applied to debt service on RUS notes and RUS-guaranteed FFB notes. In September 2009, approximately $42.0 million of the funds available was applied to debt service. For information regarding the RUS Cushion of Credit Account, see

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Note HG of Notes to Unaudited Condensed Financial Statements and see "Financial Condition—Capital Requirements and Liquidity and Sources of Capital—Liquidity" herein.

~~During~~Inventories, which include fossil fuel and spare parts inventories, increased $24.5 million, or 14.0% in the ~~six months~~nine-month period ended ~~June~~September 30, 2009 ~~receivables increased 33.8%, or $39.5 million.~~compared to the fiscal year ended December 31, 2008. The increase was ~~partially attributable~~primarily due to a ~~$10.7~~$19.9 million increase in the receivable associated with unrealized losses on natural gas contracts. See Note C of Notes to Unaudited Condensed Financial Statements for more information regarding this unrealized loss. The December 31, 2008 receivables balance included approximately $11.7 million of credit available to the Members for a Board approved reduction to 2008 revenue requirements. The increase in receivables at June 30, 2009 was also partially due to these credits being realized by the Members during 2009. Regular monthly billings to the Members, including amounts billed on behalf of Smarr EMC, also increased approximately $12.0 million.coal fuel inventories. This increase was ~~partially due~~primarily a result of planned outages and the shifting of some generation to higher energy costs in June 2009 as compared to December 2008, and partially due to an increase in capacity charges for 2009. The increase in energy costs was driven by an increase in generation during the comparable time periods. Receivables from Smarr EMC for costs incurred for operation its facilities also increased by $3.7 million.certain natural gas-fired units.

Deferred debt expense increased ~~$9.8~~$10.2 million (net of amortization), or ~~23.3%.~~24.3% in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008. The increase was primarily due to the deferral of costs associated with the Berkshire surety bond coverage and the Series ~~2009A~~2009 A taxable bond issuance. For ~~information regarding~~a discussion of the Berkshire ~~surety~~Surety bond coverage, see ~~Note J~~Oglethorpe's Current Reports on Form 8-K dated as of ~~Notes~~May 22, 2009 and August 19, 2009.

The deferred tax asset represents an offset to ~~Unaudited Condensed Financial Statements.~~

~~Deferred outage costs increased $3.0~~the liability recorded for unrecognized tax benefits due to an uncertain tax position. Oglethorpe and its subsidiaries file a U.S. federal consolidated income tax return. The U.S. federal statute of limitations remains open for the year 2006 forward. State jurisdictions have statutes of limitations generally ranging from three to five years from the filing of an income tax return. The state impact of any federal changes remains subject to examination by various states for a period of up to one year after formal notification to the states. Years still open to examination by tax authorities in major state jurisdictions include 2006 forward. Oglethorpe had recognized a $48.0 million ~~(net~~liability for unrecognized tax benefits as of ~~amortization), or 11.0%, as a result~~December 31, 2008. During the third quarter of 2009, one of the ~~deferral~~two open years expired. Accordingly, this liability and related deferred tax asset was reduced by $24.0 million during the third quarter of 2009. Oglethorpe is carrying forward significant regular tax and alternative minimum tax (AMT) net operating losses (NOLs). Therefore, any regular tax liability in the open years related to the uncertain tax position would be offset by regular NOLs. However, Oglethorpe would be liable for the portion of AMT for this period that is not allowed to be offset by the AMT NOLs. In the current open years, Oglethorpe's exposure is not material to its consolidated results of operations, cash flows or financial position. It is expected that the amount of unrecognized tax benefits will change in the next twelve months; however, Oglethorpe does not expect the change to have a significant impact on its results of operations, its financial position or its effective tax rate.

The $26.8 million decrease in the deferred asset associated with retirement obligations in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008 was primarily due to a $47.1 million increase in the unrealized gains associated with the nuclear decommissioning fund. Consistent with Oglethorpe's ratemaking policy, unrealized gains or losses from the nuclear decommissioning fund are added to or deducted from the deferred asset associated with retirement obligations. The increase in the nuclear decommissioning fund unrealized gains therefore decreased the deferred asset $47.1 million. The deferred asset also increases or decreases to the extent of timing differences between recognized accretion expense associated with nuclear decommissioning and the amounts recovered through decommissioning fund earnings. Nuclear decommissioning accretion expense of approximately ~~$11.7~~$13.3 million and decommissioning fund net losses of ~~refueling outage costs incurred at Plant Hatch Unit No. 2 and $6.1~~approximately $7.5 million ~~of scheduled major maintenance costs at Plant Scherer Unit No. 2 during~~resulted in the ~~six months~~deferred charge increasing by $20.8 million in the nine-month period ended ~~June~~September 30, ~~2009. Deferred outage costs are amortized over~~2009 compared to the ~~plant's operating cycle.~~fiscal year ended December 31, 2008.

Deferred depreciation expense represents amounts deferred in relation to the application made to the Nuclear Regulatory Commission (NRC) to extend the licenses for Vogtle Unit No. 1 and Unit No. 2 for an additional 20 years. The license extensions were approved in June 2009. Amortization of the deferral began in June 2009 and the amortization period will be 38 years for Unit No. 1 and 40 years for unit No. 2. For further discussion regarding deferred depreciation expense, see "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS—Results of Operations—Operation Expenses" in Oglethorpe's ~~Annual Report on~~2008 Form ~~10-K~~10-K.

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The $3.3 million increase in other deferred charges was primarily due to certain costs incurred related to the construction of the two new nuclear units at Plant Vogtle. These costs include progress payments made for ~~the fiscal year ended December 31, 2008.~~amounts in dispute and training costs that are being deferred.

Equity and Liabilities

Long-term debt increased ~~$358.6~~$393.3 million in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008 as a result of the issuance of $350 million of Series ~~2009A~~2009 A fixed rate first mortgage bonds and ~~$59.2~~$114.3 million advanced under RUS-guaranteed FFB loans. The increase was somewhat offset by approximately ~~$51.1~~$65.9 million of principal payments made for certain long-term ~~debt.~~

~~Table~~debt over the first three quarters of ~~Contents~~2009.

Short-term borrowings represent borrowings to fund the acquisition of the Hawk Road Energy Facility, payments to GPC related to construction of Plant Vogtle Units No. 3 and No. 4, and planning and construction costs associated with the ~~two~~ biomass ~~units.~~facilities. For information regarding the Hawk Road Energy Facility, see Note KI of Notes to Unaudited Condensed Financial Statements.

Accounts payable ~~increased $10.6~~decreased $12.7 million, or ~~36.2%,~~43.2% in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008, largely due to ~~an $8.9~~a $6.9 million ~~increase~~decrease in the payable for natural gas and natural gas transportation. This increase was the result of increased generation at the natural gas-fired units in June 2009 as compared to December 2008. The payable to Smarr EMC for amounts billed on its behalf by Oglethorpe increased $3.4 million due to increased generation. The payable to GPC for operation, maintenance and capital ~~costs also increased by $4.2 million. Partially offsetting these increases~~costs. In addition, there was a $3.9 million decrease in the payable to Morgan Stanley as a result of the expiration of the purchase power agreement on December 31, 2008. Other purchase power payables also decreased by ~~$2.0~~$2.1 million over the first three quarters of 2009 primarily due to a decrease in spot market purchases of energy.

Accrued and withheld taxes ~~decreased $4.8~~increased $2.1 million in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008 as a result ~~of property tax payments made during the first quarter of 2009, net~~ of the normal monthly property tax ~~accruals.~~accruals net of property tax payments that were made primarily during the first quarter of 2009.

Members' advances represent funds received from the Members for prepayment of their monthly power bill. At ~~June~~September 30, 2009, approximately ~~$154.1~~$183.0 million was classified as a current liability and approximately ~~$31.6~~$11.0 million was classified as a long-term deferred liability. For information regarding the power bill prepayment program, see Note IH of Notes to Unaudited Condensed Financial Statements.

Other current liabilities ~~increased~~decreased by ~~$10.0~~$8.5 million in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008 primarily due to a ~~$10.7~~$7.6 million ~~increase~~decrease in the liability associated with the unrealized loss on natural gas ~~contracts, partially offset by a $1.2 million~~swaps. This decrease was largely due to the settlement of certain swaps that were outstanding as of December 31, 2008. Decreases in miscellaneous accrued payables and accrued payroll ascosts also contributed to the overall decrease.

The long-term contingent liability represents a liability recorded for unrecognized tax benefits. The decrease was the result of the ~~payout~~expiration of the ~~2008 performance pay.~~statute of limitations for the 2005 tax year. See deferred tax asset paragraph above for further discussion.

Power sale agreement represents the liability (net of amortization) assumed with the purchase of the Hawk Road Energy Facility. For information regarding the Hawk Road Energy Facility, see Note KI of Notes to Unaudited Condensed Financial Statements.

Other deferred credits and liabilities increased ~~$7.9~~$14.4 million in the nine-month period ended September 30, 2009 compared to the fiscal year ended December 31, 2008 primarily due to a ~~$5.0~~$7.5 million increase in funding received from the Members for future debt payments related to the Talbot ~~Energy Facility~~ and Chattahoochee Energy ~~Facility.~~Facilities. At ~~June~~September 30, 2009, a regulatory liability of ~~$1.5~~$4.9 million existed in connection with the deferral of Hawk Road Energy Facility margins. For information regarding the Hawk Road Energy Facility, see Note KI of Notes to Unaudited Condensed Financial Statements. The liability for Oglethorpe's share of GPC's other post retirement benefits also increased by ~~$933,000.~~$1.2 million over the first three quarters of 2009.

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Financial Condition

Capital Requirements and Liquidity and Sources of Capital

Environmental Capital Requirements

Oglethorpe's future capital expenditures depend in part on implementation of new or existing laws, regulations, judicial decisions, and how Oglethorpe and the other co-owners of coal-fired Plants Scherer and Wansley choose to comply with these regulations once finalized. Regulations adopted by the Georgia Environmental Protection Division (EPD) specify certain environmental control equipment that must be added to Georgia electric generating units by specific dates, including Plants Scherer and Wansley. As described in "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS—Financial Condition—Capital Requirements" in Oglethorpe's ~~Annual Report on~~2008 Form 10-K, ~~for the fiscal year ended December 31, 2008,~~ Oglethorpe forecasted expenditures of $744 million in the period 2009 through 2014 to complete environmental compliance projects underway at Plants Scherer and Wansley. The last of the Plant Wansley projects was completed and placed in

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service in July 2009; however, completion of the projects at Plant Scherer will extend over the next five years, at a projected cost of approximately ~~$690~~$630 million, and will require extended unit outages in 2009 and 2011, although not during peak energy use periods. As regulations are finalized and design work continues to determine how best to retrofit the units with the required equipment, and as the construction environment, including the ~~rising~~changing cost of materials and labor, continues to evolve, the estimated cost to install these retrofits continues to be refined. Large construction projects such as these entail certain risks, as described in Item 1A—Risk Factors ~~of Oglethorpe's Annual~~contained in this Quarterly Report on Form ~~10-K for the fiscal year ended December 31, 2008.~~10-Q. These forecasted expenditures are based on information available to Oglethorpe on the date of this Quarterly Report on Form 10-Q; however, there can be no assurance that the cost of compliance with these regulations will not be higher, nor that future regulations will not require additional reductions in emissions or earlier compliance. See Note F of the Notes to Unaudited Condensed Financial Statements for more information on environmental compliance matters.

In July 2008, the U.S. Court of Appeals for the D.C. Circuit issued its decision in litigation challenging the Environmental Protection Agency's (EPA) Clean Air Interstate Rule (CAIR). The D.C. Circuit vacated CAIR in its entirety, remanding it back to EPA for further rulemaking. However, in a subsequent decision in response to petitions for rehearing, the Court decided to remand the rule to EPA without vacating it, therefore leaving it in place until EPA issues a new rule consistent with the Court's decision. The CAIR decision came on the heels of the same Court's February 2008 decision vacating the EPA's Clean Air Mercury Rule (CAMR). Appeal of this decision to the Supreme Court was recently dismissed. Together, CAIR and CAMR were the primary federal drivers behind the decisions by the co-owners of Plants Scherer and Wansley (including Oglethorpe) to add air pollution control equipment to those plants in the 2007 to 2014 time frame in order to reduce emissions of sulfur dioxide, oxides of nitrogen and mercury. While the control equipment being added at the plants continues to be required under a separate Georgia EPD regulation, Oglethorpe cannot predict whether this equipment will meet the requirements of ~~any~~the new federal rules that ~~may be promulgated~~EPA intends to promulgate to replace CAIR and CAMR.

In July 2008, an Advance Notice of Proposed Rulemaking (ANPR) from the EPA was published in the Federal Register. Created in response to the Supreme Court's April 2007 decision in Massachusetts v. EPA, the ANPR solicits public comment on whether greenhouse gases from stationary and mobile sources should be regulated under the Clean Air Act and, if so, what issues might arise from such regulation. On April 24, 2009, EPA published a proposed rule (the "endangerment finding") that would find that greenhouse gases in the atmosphere endanger the public health and welfare. EPA issued a proposed rule on September 28, 2009 relating to the regulation of emissions of greenhouse gases from light-duty vehicles. In addition, on October 7, 2009, EPA issued a proposed rule on its interpretation of when a pollutant (such as a greenhouse gas like carbon dioxide) becomes "subject to regulation" under the Clean Air Act. If finalized as proposed, ~~the rule~~these rules would begin the process of regulating emissions

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of greenhouse gases, initially from mobile sources and then ~~later~~ from stationary sources. Oglethorpe cannot predict at this time whether these developments will result in the regulation of greenhouse gas emissions from its power plants, or the effects of any such regulation.

In addition, the possibility of new federal legislation that could lead to regulation of emissions of greenhouse gases from mobile and stationary sources continues. In June 2009, the House of Representatives passed the American Clean Energy and Security Act of 2009 (H.R. 2454), which would establish, among other things, a cap-and-trade system (starting at ~~17 percent~~17% below 2005 levels by 2020, tightening to ~~83 percent~~83% by 2050) for greenhouse gas emissions in the U.S. H.R. 2454 also includes a national renewable electricity standard, which would begin at ~~6.0 percent~~6% of retail sales in 2012, increase to ~~20 percent~~20% in 2020, and remain at that level through 2039. While Oglethorpe will not be subject to the annual renewable electricity standard—it would apply only to retail electric suppliers that sell at least 4,000,000 megawatt hours of electricity to retail consumers—initially two of its Members would be subject to the standard. Oglethorpe is currently pursuing the construction of ~~two~~at least one renewable biomass power generation ~~facilities~~facility in Georgia that it believes would ~~qualify for meeting~~meet H.R. 2454's renewable electricity standard. In the Senate, the Clean Energy Jobs and American Power Act of 2009 (S. 1733) is being debated. That bill is similar in many respects to H.R. 2454, ~~is now being considered by~~but does not include a renewable electricity standard; however, a separate Senate bill (S. 1462) does include a renewable electricity standard with the ~~Senate.~~same applicability criteria as H.R. 2454. Oglethorpe cannot predict at this time whether these legislative actions will result in a renewable electricity standard applicable to its Members or in the regulation of greenhouse gas emissions from its power plants, or the effects of any such regulation.

~~Table~~After the release of ~~Contents~~over five million cubic yards of fly ash from a power plant ash storage facility in Tennessee in December 2008, EPA has been under increased pressure to regulate the handling and storage of coal combustion products at the federal level under the Resource Conservation and Recovery Act Subtitle C (hazardous waste); this material is currently covered by state regulations in most cases and is not considered a hazardous waste. EPA has requested information on current ash impoundments at coal-fired power plants and is continuing to evaluate the safety of these structures. EPA has indicated that it will propose new rules to address these issues by the end of 2009. EPA also announced in October 2009 that it intends to revise the Steam Electric Power Generating effluent guidelines that cover wastewater discharge standards under the Clean Water Act over the next several years. Oglethorpe cannot predict at this time whether any such regulations will impact the current methods of wastewater or ash disposal utilized at Oglethorpe's plants.

In June 2008, a Fulton County, Georgia Superior Court Judge overturned an air quality permit to Longleaf Energy Associates LLC for the construction of a coal-fired power plant in Early County, Georgia. This permit had previously been upheld by the Office of State Administrative Hearings (OSAH) after an appeal by the Sierra Club and Friends of the Chattahoochee. The judgment set aside OSAH's decision, concluding that carbon dioxide emissions are regulated and thus require permitting under the Clean Air Act. On appeal, this decision was reversed by the Georgia Court of Appeals. The case was, for other reasons, remanded for further OSAH evidentiary proceedings unrelated to the carbon dioxide issue. ~~However,~~ Sierra Club and Friends of the Chattahoochee ~~have~~ applied for a discretionary appeal of the case to the Georgia Supreme Court, which on September 28, 2009 decided not to hear the appeal. Recently, Sierra Club and Friends of the Chattahoochee filed a motion for reconsideration with the Georgia Supreme Court. That motion is now pending before the Court. If the Georgia Supreme Court agrees to hear the appeal, it remains a possibility that carbon dioxide emissions from any major source could be regulated in Georgia, which could halt the permitting of any new air emission sources of any significant size in the State (including new electric generating plants currently being considered by Oglethorpe). Ongoing litigation and administrative review actions are pending in other states, where, like the Georgia case, it is being argued that Best Available Control Technology is required for carbon dioxide emissions from new or modified sources under the Clean Air Act. Oglethorpe cannot predict at this time whether any of ~~this litigation~~these actions will result in the regulation of greenhouse gas emissions from its power plants, or the effects of any such regulation.

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Current Financial Market Conditions

~~Since~~From mid-2007 through 2008, the financial services sector ~~has been~~was negatively impacted by significant write-offs related to sub-prime mortgages and the re-pricing of credit risk. Global credit and other financial markets ~~have~~ suffered substantial stress, volatility, illiquidity and disruption, with sub-prime mortgage related issues being the most significant contributing factor. These forces reached unprecedented levels by the fall of 2008, resulting in the insolvency or acquisition of, or government assistance to, several major domestic and international financial institutions. These events led to significantly diminished overall confidence in the credit markets and other financial markets and caused increasing economic uncertainty. This reduced confidence and uncertainty led to reduced lending between banks and to third parties. The commercial paper markets ~~have~~ also ~~seen~~experienced significant disruptions, particularly in the fourth quarter of 2008, with commercial paper maturities limited to periods ranging from approximately one to thirty days even for highly rated issuers, if they were able to issue commercial paper at all, along with abnormally high interest rates on issued paper.

However, during the first ~~six~~nine months of 2009 the severe stress in the financial markets ~~began to abate. While conditions are far from normal,~~has somewhat abated, and certain sectors of the capital markets have begun to function better. The market for corporate debt has improved, credit spreads have tightened, and borrowing rates ~~particularly short-term rates,~~ have trended lower. Oglethorpe successfully accessed the taxable bond markets in February 2009 and again in early November 2009, issuing ~~$350~~a total of $750 million at favorable fixed rates. The commercial paper markets have improved as well, and Oglethorpe has been able to successfully ~~issued $222 million of~~issue commercial paper since April 2009 at favorable short-term rates.

Obtaining favorable financing is important to Oglethorpe's business due to, among other things, its significant capital needs related to ~~maintain existing electric generation facilities, comply~~(i) normal maintenance of, and compliance with environmental requirements and regulations at, its existing generation facilities, and ~~construct~~(ii) construction of new ~~generating~~generation facilities requested by Members to support growth in their energy needs. See"Liquidity" and"Financing Activities" for additional information regarding Oglethorpe's short-term and long-term financing needs.

Nuclear Decommissioning Funds

The market value of Oglethorpe's nuclear decommissioning funds (external and internal combined) declined ~~approximately 18 percent~~by $50 million (18%) in the year ended December 31, 2008, but ~~had a net increase of approximately 5 percent~~increased $38 million (16%) in the first ~~six~~nine months of 2009. AnA new decommissioning site study is underway and an analysis of funding adequacy ~~is currently underway, and later in 2009 a new decommissioning~~will be undertaken once the site study ~~will be performed.~~has been completed. The combination of

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the results of these two studies will be utilized to evaluate whether or not Oglethorpe should resume collecting funds from its Members for nuclear decommissioning. However, any resumption of fund collections from the Members would likely not take effect until at least 2010.

Liquidity

At ~~June~~September 30, 2009, Oglethorpe had ~~$710~~$924 million of unrestricted available liquidity to meet short-term cash needs and liquidity requirements. This amount included ~~$382~~$471 million in cash and cash equivalents and ~~$328~~$453 million of unused and available committed short-term credit arrangements. On August 11, 2009, Oglethorpe closed on a $250 million five-year revolving line of credit and term loan agreement with CFC pursuant to which amounts outstanding under the line of credit can be converted, at any time, to a term loan with a maturity no later than December 31, 2043. Any amounts drawn under this new CFC line of credit, as well as any amounts converted to a term loan, will be secured under Oglethorpe's Mortgage Indenture. Oglethorpe's short-term credit facilities are shown in the table below. Oglethorpe expects to renew these short-term credit facilities, as needed, prior to their respective expiration dates.

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Committed Short-Term Credit Facilities
(dollars in millions)

Committed Short-Term Credit Facilities
(dollars in millions)

Authorized
Amount
Available
6/30/2009
Available
8/12/2009
Expiration Date

Commercial Paper Line of Credit
$ 450 $ 228 $ 167 July 2012
CoBank Line of Credit
50 50 50 December 2009
CFC Line of Credit
50 50 50 October 2011
CFC Line of Credit
250 n/a 250 December 2013

Total
$ 800 $ 328 $ 517

	Authorized Amount		Available 9/30/2009		Expiration Date


Commercial Paper Line of Credit	$	450	$	103	July 2012
CoBank Line of Credit		50		50	December 2009
CFC Line of Credit		50		50	October 2011
CFC Line of Credit		250		250	December 2013

Total	$	800	$	453

~~At June 30, 2009,~~ Oglethorpe ~~had $222 million of commercial paper outstanding in connection with~~is currently utilizing its short-term credit arrangements to provide temporary funding for (i) payments to ~~Georgia Power Company pursuant to the EPC Contract~~GPC related to construction of Plant Vogtle Units No. 3 and No. 4, (ii) ~~the acquisition of Hawk Road Energy Facility, and (iii)~~ initial engineering and design work related to ~~two proposed~~ biomass ~~facilities.~~facilities, (iii) acquisition of the Hawk Road Energy Facility in April 2009, and (iv) acquisition of the Hartwell Energy Facility in October 2009. For a discussion of the new nuclear units and biomass facilities under development, see "BUSINESS—OGLETHORPE'S POWER SUPPLY RESOURCES—Future Power Resources—Plant Vogtle Units No. 3 and No. 44"" and "—Biomass Plants." in Oglethorpe's ~~Annual Report on~~2008 Form 10-K ~~for the fiscal year ended December 31, 2008.~~and "Recent Developments" herein. For a discussion of the Hawk Road Energy Facility acquisition, see Note KI of Notes to Unaudited Condensed Financial Statements herein. For a discussion of the Hartwell Energy Facility acquisition, see Note J of Notes to Unaudited Condensed Financial Statements herein. For a discussion of Oglethorpe's plans regarding permanent financing of these generation facilities, see"Financing ~~Activities."~~Activities" herein.

Under the commercial paper program, Oglethorpe is authorized to issue commercial paper in amounts that do not exceed the amount of any committed backup lines of credit, thereby providing ~~100 percent~~100% dedicated backup support for any paper outstanding. Oglethorpe periodically assesses its needs in order to

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determine the appropriate amount of commercial paper backup to maintain and currently has in place a $450 million committed backup credit facility provided by seven banks as shown in the table below.


Participant Banks in $450 Million Credit Facility		Commitment
		(dollars in millions)

Bank of America, N.A. (Administrative Agent)	$	75
SunTrust Bank	$	75
The Bank of Tokyo-Mitsubishi UFJ, Ltd.	$	60
CoBank, ACB	$	60
JPMorgan Chase Bank, National Association	$	60
National Rural Utilities Cooperative Finance Corporation	$	60
Wachovia Bank, National Association (a Wells Fargo company)	$	60

All of the banks participating in Oglethorpe's credit facilities are performing their obligations under these facilities and are meeting our funding needs. Oglethorpe expects to renew these short-term credit facilities, as needed, prior to their respective expiration dates.

Along with the lines of credit from CoBank, ACB and the National Rural Utilities Cooperative Finance Corporation (CFC), funds may also be advanced under the commercial paper backup line of credit for working capital purposes. In addition, Oglethorpe has the ability to issue letters of credit to third parties in amounts up to $50 million under each of the ~~three~~$50 million CoBank line of credit, ~~facilities, or~~the $50 million CFC line of credit and the $450 million commercial paper backup line of credit, for a total of $150 million in the aggregate. However, any amounts related to issued letters of credit will reduce the amount available to draw as working capital under each facility. Also, due to the requirement to have ~~100 percent~~100% dedicated backup for any commercial paper outstanding, any amounts drawn under the

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commercial paper backup line for working capital or related to issued letters of credit will reduce the amount of commercial paper that Oglethorpe can issue.

Under the $250 million line of credit with CFC, Oglethorpe has the option of converting any amounts outstanding under the line of credit to a term loan with a maturity no later than December 31, 2043. Any amounts drawn under the $250 million CFC line of credit, as well as any amounts converted to a term loan, will be secured under Oglethorpe's Mortgage Indenture.

The commercial paper backup credit facility contains a financial covenant requiring Oglethorpe to maintain minimum levels of patronage capital. At ~~June~~September 30, 2009, the required minimum level was approximately $429 million and Oglethorpe's actual patronage capital was ~~$564~~$576 million. However, in connection with a line of credit expected to close in November 2009, Oglethorpe has agreed to a financial covenant that will require it to maintain minimum patronage capital of $525 million. The commercial paper backup credit facility contains an additional covenant limiting Oglethorpe's secured indebtedness to no more than $8.5 billion and unsecured indebtedness to no more than $4.0 billion. At ~~June~~September 30, 2009, Oglethorpe had approximately $3.8 billion of secured indebtedness outstanding and ~~$222~~$347 million of unsecured indebtedness outstanding.

InDue to instability in the financial markets, in December 2008 Oglethorpe instituted a power bill prepayment program ~~pursuant~~ to ~~which~~provide for an additional source of liquidity. Under the program, Members can prepay their power bills from Oglethorpe at a discount for an agreed upon number of months in advance, after which point the ~~funds~~advances are credited against the participating Members' monthly power bills. AsThe discount is comparable to Oglethorpe's avoided cost of ~~June~~borrowing. At September 30, 2009, ~~fourteen~~Oglethorpe had received Member advances totaling $200 million from the fifteen Members ~~had prepaid $191 million under this~~participating in the program. Oglethorpe began applying the ~~prepayments~~advances against participating Members' power bills in May 2009 and expects to continue doing so through September 2013, with the majority scheduled to be applied in 2010. ~~These prepayments are separately identified as "Members' advances" on Oglethorpe's balance sheets (net~~For more information regarding the power bill prepayment program, see Note H of ~~the amounts credited against power bills) and statements of cash flows. An additional $7.5 million was prepaid in early July 2009. This program is providing additional liquidity~~Notes to ~~Oglethorpe prior to the point the funds are credited against monthly power bills.~~Unaudited Condensed Financial Statements.

At ~~June~~September 30, 2009, Oglethorpe had ~~$81~~$40 million of restricted short-term investments pursuant to deposits made to a RUS Cushion of Credit Account. The deposits with the U.S. Treasury were made voluntarily and earn interest at a guaranteed rate of ~~5 percent~~5% per annum. The funds in the account, including interest thereon, can only be applied to debt service payments on RUS notes and RUS-guaranteed

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FFB notes. Oglethorpe ~~expects to~~may apply ~~these~~the funds remaining in the account at September 30, 2009 against debt service payments due on ~~September 30, 2009 and~~ December 31, 2009, ~~which would essentially zero out~~and may also deposit additional funds into the ~~account.~~account prior to December 31, 2009.

Oglethorpe is continuing to pursue additional credit facilities that would further enhance ~~Oglethorpe's~~ liquidity throughout the anticipated period of generation facility ~~construction.~~construction, and expects to close on a new $150 million credit facility with CoBank in November 2009 and a new $150 million credit facility with JPMorgan Chase Bank in December 2009. Oglethorpe anticipates utilizing approximately $115 million of the JPMorgan credit facility as a letter of credit supporting variable rate PCBs to be issued in December 2009, and the remaining $35 million for general working capital. The timing, size and term of potential additional facilities will be influenced by many factors, including the ultimate size of the construction program and market conditions. Between projected cash on hand and the credit facilities currently in place or under negotiation, Oglethorpe believes it will have sufficient liquidity to fund its construction program and to cover normal operations through 2011.

Financing Activities

Bond Financings. ~~In the fall of~~On November 3, 2009, Oglethorpe ~~anticipates issuing~~issued $400 million of First Mortgage Bonds, Series ~~2009B first mortgage bonds~~2009 B, for the purpose of financing a portion of the cost of constructing Plant Vogtle Units No. 3 and No. 4 (including redeeming commercial paper issued in connection with the construction of ~~the~~these new ~~generation facilities~~nuclear units) and to provide liquidity for general corporate purposes. ~~The first mortgage~~These bonds ~~will be~~were secured under Oglethorpe's Mortgage Indenture.

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In 2006, Oglethorpe received an allocation from the Internal Revenue Service (IRS) to issue up to $24 million of Clean Renewable Energy Bonds (CREBs) to fund an upgrade project currently underway at its Rocky Mountain generating facility. CREBs ~~are~~were originally designed to be zero coupon bonds ~~and~~whereby in lieu of receiving an interest payment from the issuer the bondholder receives a credit against its federal income tax liability. Oglethorpe ~~had its CREB application submitted~~is working on a transaction that is expected to close by December 31, 2009, the ~~IRS on its behalf by CFC, along with~~point at which the ~~applications of other electric cooperatives. CFC, as a qualified issuer under the program,~~CREBs allocation expires, pursuant to which one investor will ~~issue the bonds and loan the proceeds at a low rate of interest (approximately 1.5 percent) to the cooperatives whose applications were approved. Oglethorpe anticipates that CFC will issue~~purchase all $24 million of CREBs ~~on Oglethorpe's behalf in~~from Oglethorpe at an interest rate anticipated to be below two percent. If issued, the ~~third quarter of 2009 and shortly thereafter will begin advancing funds under the related loan. This loan~~CREBs will be secured under Oglethorpe's Mortgage Indenture.

In ~~late~~December 2009, Oglethorpe anticipates issuing ~~up to~~ approximately ~~$120~~$115 million of tax-exempt PCBs, including (i) $11 million to refinance outstanding PCBs scheduled to mature on January 1, 2010, and (ii) $9$104 million of new money tax-exempt PCBs related to the installation of scrubbers at Plant Wansley and ~~(iii) up to $100 million of new-money tax-exempt PCBs related to~~ a mercury control project at Plant Scherer. These PCBs will be secured under Oglethorpe's Mortgage Indenture.

RUS-Guaranteed Loans. Oglethorpe currently has three approved RUS-guaranteed loans (funded through the FFB) totaling $844 million that are in various stages of being drawn ~~down.~~down, with $683 million remaining to be advanced. One of these loans, totaling $310 million, was approved in ~~early~~ August of 2009 and relates to ~~$100 million in~~ general improvements at existing facilities ~~along with $210 million of~~and environmental projects at Plants Scherer and Wansley. Oglethorpe has also ~~has two~~submitted four RUS loan applications that are pending, totaling ~~$933 million,~~$1.3 billion, relating to the ~~two planned~~ biomass facilities, ~~but~~the Hawk Road Energy Facility acquisition and the Hartwell Energy Facility acquisition. Oglethorpe anticipates that RUS may take action on ~~these two~~the Hawk Road Energy Facility and Hartwell Energy Facility loan applications sometime in 2010, but action on the biomass loan applications is not expected before 2011.

~~In August 2009 Oglethorpe plans to file an additional RUS loan application in the amount of $206 million related to the acquisition of Hawk Road Energy Facility.~~ For a discussion of the Hawk Road Energy Facility acquisition and Hartwell Energy Facility acquisition, see ~~Note K~~Notes I and J of Notes to Unaudited Condensed Financial Statements herein. For a discussion of the biomass facilities, see "BUSINESS—OGLETHORPE'S POWER SUPPLY RESOURCES—Future Power Resources—Biomass Plants" in Oglethorpe's 2008 Form 10-K and "Recent Developments" herein.

Department of Energy (DOE)-Guaranteed Loans. In connection with Oglethorpe's participation in two new nuclear units at the existing Plant Vogtle site (see "BUSINESS—OGLETHORPE'S POWER SUPPLY RESOURCES—Future Power Resources—Plant Vogtle Units No. 3 and No. 4" in Oglethorpe's ~~Annual Report on~~2008 Form ~~10-K for the fiscal year ended December 31, 2008)~~10-K), in September 2008 and December 2008, Oglethorpe submitted Part I and Part II loan applications, respectively, in connection with the DOE Loan Guarantee Program seeking funding for the project. Two of the other three co-owners in the new Vogtle units have also applied for the DOE funding. Oglethorpe is pursuing this funding

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source as a result of a moratorium currently in place at RUS regarding the funding of new baseload (coal and nuclear) generating plants. The DOE Loan Guarantee Program, which is intended to support commercialization of innovative technologies to reduce air pollutants including greenhouse gases, was initially authorized pursuant to the Energy Policy Act of 2005 and was subsequently funded and extended. The loan structure would entail a loan funded through the FFB carrying a federal loan guarantee provided by the DOE. ~~The~~In September 2009 the DOE ~~recently~~ notified Oglethorpe that the Vogtle project ~~has been~~was selected for final due diligence and detailed negotiations leading to a potential conditional commitment for a DOE federal loan guarantee. This term sheet negotiation phase is ~~anticipated~~underway and is expected to ~~extend~~continue into December 2009, at which point execution of a conditional term sheet is anticipated. Although final approval could occur at any time after the ~~fourth quarter of 2009, and~~conditional term sheet is executed, it is possible that a final decision on loan approval iswould not ~~anticipated any sooner than late in 2009.~~occur until 2011. Even if DOE funding is obtained, DOE only has authority to fund up to ~~80 percent~~80% of the full cost of the project. Therefore, Oglethorpe will seek other sources of funding, including the issuance of taxable bonds and tax-exempt bonds (for any equipment that may qualify for such tax-exempt funding) for any portion of the project not financed through the DOE Loan Guarantee Program.

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For more detailed information regarding Oglethorpe's financing plans, see "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS—Financial Condition—Financing Activities" in Oglethorpe's ~~Annual Report on~~2008 Form ~~10-K for the fiscal year ended December 31, 2008.~~10-K.

~~Rocky Mountain Lease Arrangements~~

Pursuant to the AIG Equity Funding Agreements, RMLC deposited $57 million with AIG Matched Funding Corp. that was invested in six guaranteed investment contracts that will increase in value during the term of the lease, and at the end of the lease term will have a value equal to the equity portion of the fixed purchase price, or $372 million. These investments are reflected on Oglethorpe's balance sheet as "Deposit on Rocky Mountain transactions", with a balance of $112 million at June 30, 2009.

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institution that has credit ratings of at least Aa2 from Moody's and AA from S&P. In the event that RMLC were not able to enter into replacement Equity Funding Agreements, then RMLC may be required to purchase the Trusts' equity interests from the owners thereof.

In September 2008, Moody's lowered AIG's rating to A2 from Aa3 and S&P lowered AIG's rating to A- from AA-. As a result of the downgrade, AIG Matched Funding Corp. posted collateral in compliance with the AIG Equity Funding Agreements, consisting of securities issued by an instrumentality of the United States government that are rated triple-A in an amount equal to the net present value of its future payment obligations related to the equity portion of the fixed purchase price (the "Collateral Requirement"). In accordance with the terms of the AIG Equity Funding Agreements, the market value of the posted collateral (other than cash) will be determined weekly by an independent third party and AIG Matched Funding Corp. will be required to post additional collateral to the extent that it is determined that the market value of such collateral, together with the cash collateral (if any), has fallen below the Collateral Requirement. According to U.S. Bank National Association, which as collateral agent holds the collateral and provides the weekly valuation thereof, the market value of the collateral was $119 million at June 30, 2009.

On November 19, 2008, S&P lowered AMBAC's credit rating from AA to A. Because AMBAC already had a credit rating of Baa1 from Moody's, such action by S&P triggered the requirement for Oglethorpe to provide the replacement credit enhancement discussed above. Each of the three owner participants have granted Oglethorpe extensions of time to provide this replacement credit enhancement.

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with AIG Matched Funding Corp. in connection with the sixth long-term lease transaction. The actual value of the guaranteed investment contract may be more or less than the accreted value as a result of changes in interest rates and market conditions. Oglethorpe expects to have adequate liquidity to purchase the equity interest based on the maximum aggregate amount of exposure of approximately $25 million, if it were required to do so.

Newly Adopted or Issued Accounting Standards

For a discussion of SFAS No.165, "Subsequent Events", SFAS No. 166, "Accounting for Transfers of Financial Assets—an amendment of SFAS No. 140", SFAS No. 167, "Amendments to FASB Interpretation No. 46(R)" and SFAS No. 168, "The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting ~~Principles",~~Principles," "Accounting for Transfers of Financial Assets—an amendment of Accounting for Transfers for Servicing of Financial Assets and Extinguishments of Liabilities" and "Amendments to Consolidation of Variable Interest Entities," see Note D of Notes to Unaudited Condensed Financial Statements herein.

Recent Developments

~~On July 31, 2009,~~Future Generation. As previously discussed in its SEC filings, Oglethorpe ~~notified~~is pursuing development of two 100 megawatt biomass-fueled generating facilities that have been subscribed by its Members. Oglethorpe has acquired sites for these facilities and is currently in the ~~partners~~process of ~~the Hartwell Energy Limited Partnership (HELP) of~~conducting preliminary engineering work and environmental analyses. Oglethorpe's ~~intent~~estimated cost to ~~purchase HELP, which owns the 300 megawatt Hartwell plant, an oil and gas-fired peaking facility in northeast Georgia. The purchase price~~construct these two facilities is ~~$148.5~~approximately $930 million, including ~~approximately $54.0 million of existing project level debt, plus a working~~allowance for funds used during construction; however, no significant capital expenditures will be required until after 2011. The plants are planned for commercial operation in 2014 and fuel oil adjustment to be determined at closing. Completion of the purchase is expected in the third quarter of 2009. Oglethorpe plans to issue commercial paper to provide temporary funding for the purchase of the Hartwell plant, and later in 2009 intends to submit an RUS loan application for permanent financing.

Oglethorpe already has a power purchase arrangement with HELP to purchase the output of the plant through May 2019 under which it has a right of first refusal to purchase the facility. See "BUSINESS—2015. See"BUSINESS—OGLETHORPE'S POWER SUPPLY RESOURCES—Future Power ~~Purchase and Sale Agreements—~~Resources—~~Power Purchase~~Biomass Plants," in Oglethorpe's ~~Annual Report on~~2008 Form ~~10-K~~10-K.

While Oglethorpe continues to move ahead as planned with one biomass facility, a variety of factors are leading it to re-evaluate existing plans for the ~~fiscal year ended December 31, 2008.~~second facility and examine a range of alternatives. This re-evaluation could lead to several outcomes; including, but not limited to, cancelling or downsizing the facility, entering into a joint venture, or delaying the facility beyond its scheduled 2015 commercial operation date.

~~The purchase~~New Member. Flint EMC, who withdrew from membership in Oglethorpe effective January 1, 2005, has applied for membership in Oglethorpe, which the Oglethorpe board of ~~the plant by Oglethorpe will be~~directors has accepted, subject to ~~applicable regulatory approvals~~certain conditions, which the Flint EMC board of directors has accepted. Flint EMC has executed a Wholesale Power Contract with Oglethorpe, which is subject to RUS approval. Membership is also subject to execution by the current Members of an agreement related to the New Business Model Member Agreement. For additional information, see "BUSINESS—OGLETHORPE POWER CORPORATION—Competition" and ~~lender consent.~~

In June 2007, Georgia Power Company, as agents for the co-owners, filed an application with the Nuclear Regulatory Commission to extend the licenses for Vogtle Unit No. 1 and Unit No. 2 for an additional 20 years. Effective July 1, 2007, Oglethorpe under the provisions of SFAS No. 71 began deferring the difference between Plant Vogtle depreciation expense based on the then current 40-year operating license versus depreciation expense based on the applied 20-year license extension. On June 3, 2009, the Nuclear Regulatory Commission granted 20-year license extensions for Vogtle Unit No. 1 and Unit No. 2. Amortization of the deferred amount totaling approximately $54.9 million at May 31, 2009 to depreciation expense over the extended license period began"—New Business Model Member Agreement" in ~~June 2009.~~Oglethorpe's 2008 Form 10-K.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Oglethorpe's market risks have not changed materially from the risks reported in Oglethorpe's ~~Annual Report on~~2008 Form ~~10-K for the fiscal year ended December 31, 2008.~~10-K.

Item 4. Controls and Procedures

As of ~~June~~September 30, 2009, Oglethorpe had carried out an evaluation, under the supervision and with the participation of its management, including its President and Chief Executive Officer and Executive Vice President and Chief Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended). Based on this evaluation, the President and Chief Executive Officer and the

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Executive Vice President and Chief Financial Officer concluded that Oglethorpe's disclosure controls and procedures are effective.

There have been no changes in Oglethorpe's internal control over financial reporting or other factors that occurred during the quarter ended ~~June~~September 30, 2009 that have materially affected, or are reasonably likely to materially affect, Oglethorpe's internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings

Oglethorpe is a party to various actions and proceedings incidental to its normal business. Liability in the event of final adverse determination in any of these matters is either covered by insurance or, in the opinion of Oglethorpe's management, after consultation with counsel, should not in the aggregate have a material adverse effect on the financial position or results of operations of Oglethorpe.

Item 1A. Risk Factors

~~There~~Oglethorpe is undertaking a large capital expansion program that will significantly increase its long-term debt.

Oglethorpe is undertaking a large capital expansion program to meet the future energy needs of its Members, and will incur a significant amount of long-term debt in connection with this capital expansion program. As of September 30, 2009, Oglethorpe had $3.8 billion of long-term debt outstanding. For the remainder of 2009 through 2017, Oglethorpe projects that it will invest approximately $7.5 billion to $9.0 billion in new generation facilities and upgrades to its existing generation facilities. As a result of this program, Oglethorpe projects that it will have approximately $10.0 billion in long-term debt outstanding by the end of 2017. See "BUSINESS—OGLETHORPE'S POWER SUPPLY RESOURCES—Future Power Resources" and "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS—Financial Condition—Capital Requirements—Capital Expenditures" in Oglethorpe's 2008 Form 10-K.

This significant increase in long-term debt is expected to increase the cost of electric service Oglethorpe provides to its Members. In addition, Oglethorpe will continue to be highly leveraged and certain of its financial metrics may weaken, which could impact Oglethorpe's credit ratings. To address this situation, Oglethorpe's Board of Directors has approved budgets for 2009 and 2010 to achieve a 1.12 and 1.14 MFI Ratio, respectively; each above the minimum 1.10 MFI Ratio required under the Mortgage Indenture. However, even with these MFI Ratio increases, Oglethorpe's equity ratios will decrease during the period of new generation construction. Any reduction in Oglethorpe's credit ratings could increase its borrowing costs and decrease its access to the credit and capital markets.

Oglethorpe's ability to access and cost of capital could be adversely affected by various factors, including current market conditions, potential limitations on the availability of RUS loans and its credit ratings, and significant constraints on Oglethorpe's access to capital could adversely affect its financial condition and results of operations.

Oglethorpe relies on access to external funding sources as a significant source of liquidity for capital requirements not satisfied by cash flow generated from operations. Historically, Oglethorpe and other electric generating cooperatives have relied on federal loan programs guaranteed by the RUS in order to meet a significant portion of their long-term financing needs, typically at a cost that was lower than traditional capital markets financing. However, the availability and magnitude of annual RUS funding levels are subject to the federal budget appropriations process, and therefore are subject to uncertainty because of periodic budgetary and political pressures faced by Congress. In addition, a new wave of generation construction nationwide among electric cooperatives is resulting in increased competition for available RUS funding. Further, there is currently a moratorium in place at the RUS regarding the funding of new baseload coal and nuclear generation facilities. In light of this moratorium, Oglethorpe has applied for funding from the FFB guaranteed by the DOE for its cost of two additional nuclear units at Plant Vogtle. Even if funding guaranteed by the DOE is obtained, the DOE only has authority to fund up to 80% of the full cost of the project. If the amount of RUS-guaranteed loan funds available to Oglethorpe in the future is further decreased or eliminated or Oglethorpe is unable to secure DOE-guaranteed loan funds, Oglethorpe would have to seek alternative sources of financing which will likely be at a higher cost.

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Therefore, Oglethorpe's reliance on access to both short-term and long-term capital market funding has become an increasingly important factor, particularly in light of the significant amount of new generation construction that Oglethorpe has planned over the next decade to meet the future energy needs of its Members. Oglethorpe has successfully accessed the capital markets in the past, and believes that it will be able to maintain sufficient access to capital markets based on its current credit ratings. However, Oglethorpe's credit ratings reflect the views of the rating agencies, which could change at any point in the future. Oglethorpe's borrowing costs could increase and its potential pool of investors, funding sources and liquidity could decrease if its credit ratings were lowered, particularly if its ratings were lowered below investment grade.

The cost of all of Oglethorpe's debt financing is affected by general market interest rate levels, and if these interest rate levels increase at the time Oglethorpe borrows, its interest costs will increase and its financial condition and future results of operations could be adversely affected.

In addition, certain market disruptions could constrain, at least temporarily, Oglethorpe's ability to maintain sufficient liquidity and to access capital on favorable terms or at all. These disruptions include:

•: market conditions generally, including the current uncertainty in the credit and capital markets;
•: an economic downturn or recession;
•: instability in the financial markets;
•: a tightening of lending and lending standards by banks and other credit providers;
•: the overall health of the energy industry;
•: negative events in the energy industry, such as a bankruptcy of an unrelated energy company;
•: lender concerns regarding potential cost overruns associated with nuclear construction;
•: war or threat of war; or
•: terrorist attacks or threatened attacks on Oglethorpe's facilities or the facilities of unrelated energy companies.

If Oglethorpe's ability to access capital becomes significantly constrained for any of the reasons stated above, its ability to finance ongoing capital expenditures required to maintain existing generating facilities and to construct or acquire future power supply facilities could be limited, its interest costs could increase and its financial condition and future results of operations could be adversely affected.

Oglethorpe is exposed to uncertainty of capital expenditures in connection with construction projects at its existing generating facilities and for the construction of new generating facilities.

Oglethorpe's existing facilities require ongoing capital expenditures in order to maintain efficient and reliable operations. Many of Oglethorpe's facilities were constructed over 20 to 30 years ago and, as a result, may require significant capital expenditures in order to maintain efficiency and reliability, and to comply with changing environmental requirements.

In addition, due to projected growth in their service territories, the Members have requested that Oglethorpe expand its existing generating facilities and build or acquire new generating facilities, which will require significant capital expenditures and investment.

The completion of construction projects without delays or cost overruns is subject to substantial risks, including:

•: shortages and inconsistent quality of equipment, materials and labor;

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•: work stoppages;
•: permits, approvals and other regulatory matters;
•: adverse weather conditions;
•: unforeseen engineering problems;
•: environmental and geological conditions;
•: delays or increased costs to interconnect Oglethorpe's facilities to transmission grids;
•: unanticipated increases in the costs of materials and labor;
•: performance by engineering, construction or procurement contractors;
•: increases in the cost of debt financing; and
•: attention to other projects.

In addition, the construction of large generating plants involves significant financial risk. Moreover, no nuclear plants have been constructed in the United States using advanced designs. Therefore, estimating the cost of construction of any ~~material~~new nuclear plant is inherently uncertain and, as a result, Oglethorpe could be exposed to additional risk of cost uncertainty in connection with these projects.

All of these risks could have the effect of increasing the cost of electric service Oglethorpe provides to its Members.

Oglethorpe owns nuclear facilities, which give rise to environmental, regulatory, financial and other risks, and is participating in the development of new nuclear facilities.

Oglethorpe owns a 30% undivided interest in Plant Hatch and Plant Vogtle, each of which is a two unit nuclear generating facility, and which collectively account for approximately 25% of Oglethorpe's generating capacity. Oglethorpe's ownership interest in these facilities exposes it to various risks, including:

•: potential liabilities relating to harmful effects on the environment and human health resulting from the operation of these facilities and the on-site storage, handling and disposal of spent nuclear fuel;
•: significant capital expenditures relating to maintenance, operation, security and repair of these facilities, including repairs required by the NRC;
•: potential liabilities arising out of nuclear incidents or terrorist attacks, including the payment of respective insurance premiums, whether at its own plants or the plants of other nuclear owners; and
•: risks related to the expected cost, and funding of the expected cost, of decommissioning these facilities at the end of their operational life.

Currently, there is no national repository for spent nuclear fuel, and progress towards such a repository has been disappointing. Spent nuclear fuel from Plants Hatch and Vogtle is currently stored in on-site storage facilities. Oglethorpe currently forecasts that the on-site storage capabilities at Plants Hatch and Vogtle can be expanded to accommodate spent fuel through the life of the plants.

Oglethorpe maintains an internal fund and an external trust fund for the expected cost of decommissioning its nuclear facilities; however, it is possible that decommissioning costs and liabilities could exceed the amount of these funds.

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The NRC has broad authority under federal law to impose licensing and safety-related requirements for the operation of these facilities. If these facilities were found to be out of compliance with applicable requirements, the NRC may impose fines or shut down one or more units of these facilities until compliance is achieved. Revised safety requirements issued by the NRC have, in the past, necessitated substantial capital expenditures at other nuclear generating facilities. In addition, while Oglethorpe has no reason to anticipate a serious incident at either of these plants, if an incident did occur, it could result in substantial costs to Oglethorpe. A major incident at a nuclear facility anywhere in the world could cause the NRC to limit or prohibit the operation or licensing of any domestic nuclear unit.

In addition to its existing ownership of nuclear units, Oglethorpe is participating with the other co-owners of Plant Vogtle in the construction of two additional nuclear units at the Plant Vogtle site. See "BUSINESS—OGLETHORPE'S POWER SUPPLY RESOURCES—Future Power Resources—Plant Vogtle Units No. 3 and No. 4" in Oglethorpe's 2008 Form 10-K.

Oglethorpe's costs of compliance with environmental laws and regulations are significant and have increased in recent years, and Oglethorpe may face increased costs related to environmental compliance, litigation or liabilities in the future.

As with most electric utilities, Oglethorpe is subject to extensive federal, state and local laws and regulations regarding air and water quality which, among other things, regulate emissions of pollutants, such as particulate matter, sulfur dioxide, nitrogen oxides and mercury into the air and discharges of other pollutants, including heat, into waters. Oglethorpe is also subject to federal, state and local waste disposal requirements that regulate the manner of transportation, storage and disposal of various types of waste.

Generally, these environmental regulations are becoming increasingly stringent and may require Oglethorpe to change the design or operation of existing facilities or change or delay the location, design, construction or operation of new facilities. These changes, in turn, may result in substantial increases in the cost of electric service. For example, the EPA has indicated that it intends to propose new regulations on the handling and disposal of coal combustion by-products. To date, Oglethorpe has committed significant capital expenditures to achieve and maintain compliance with these regulatory requirements at its facilities, and Oglethorpe expects that it will make significant capital expenditures related to environmental compliance in the future.

While Oglethorpe will continue to exercise its best efforts to comply with all applicable regulations, there can be no assurance that Oglethorpe will always be in compliance with all current and future environmental requirements. Failure to comply with these requirements, even if this failure is caused by factors beyond Oglethorpe's ~~risk factors~~control, could result in the imposition of civil and criminal penalties against Oglethorpe, as well as the complete shutdown of individual generating units not in compliance with these regulations.

Additionally, litigation relating to environmental issues, including claims of property damage or personal injury caused by alleged exposure to hazardous materials, has increased in recent years. Likewise, actions by private citizen groups to enforce environmental laws and regulations are increasingly prevalent. While management does not currently anticipate that any such litigation would have a material adverse effect on Oglethorpe's financial condition, the ultimate outcome of any of these actions cannot be predicted.

In addition, existing environmental laws and regulations may be revised or new laws and regulations seeking to protect the environment may be adopted or become applicable to Oglethorpe's facilities. Revised or additional laws and regulations, and in particular climate change legislation or regulations, could result in significant additional expense and operating restrictions on Oglethorpe's facilities or increased compliance costs which may result in significant increases in the cost of electric service. The

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financial impact of any legislation or regulation would depend upon the specific requirements enacted and cannot be determined at this time.

Oglethorpe may become subject to legislative and regulatory responses to climate change, with which compliance could be difficult and costly.

Efforts to limit emissions of carbon dioxide from ~~those reported~~power plants continue to increase. The EPA has issued an Advance Notice of Proposed Rulemaking that suggests various alternatives for regulating greenhouse gases under the Clean Air Act. The EPA has also made an "endangerment finding" for carbon dioxide, which, if carried through, would trigger a series of events that could result in ~~Item 1A~~the regulation of carbon dioxide as an air pollutant. Many of Oglethorpe's ~~Annual~~electric generating facilities are likely to be subject to regulation under climate change laws and/or regulations which result from these activities within the next few years. In 2008, 51% of Oglethorpe's generation, excluding pumped storage, came from its interest in the coal-fired Plants Scherer and Wansley, which would be the most impacted by any greenhouse gas related legislation or regulation, while another 7% came from its gas-fired facilities (which would also be somewhat impacted but not to the same extent as the coal-fired facilities). The remaining generation (42%) came from Oglethorpe's interest in the nuclear Plants Vogtle and Hatch and would not likely be impacted by any climate change legislation or regulation.

Many of the climate change legislative proposals use a "cap-and-trade" policy structure, in which carbon dioxide and other greenhouse gas emissions from some portion of the economy would be subject to an overall cap, which would decrease (i.e., become more stringent) over time. For example, the Waxman-Markey bill, which was passed by the House of Representatives on June 26, 2009, proposes to enact a cap-and-trade regime in order to regulate carbon dioxide and other greenhouse gas emissions. The proposals establish mechanisms for emissions sources, such as power plants, to obtain "allowances" or permits to emit carbon dioxide and other greenhouse gases during the course of the year. This program would be similar to the emission allowance trading program for sulfur dioxide established by the Clean Air Act Amendments of 1990. However, unlike the program for sulfur dioxide, Oglethorpe and other utilities may need to purchase all or many of the necessary allowances in an auction format, rather than being issued allowances for no additional charge. Depending upon the price of available allowances, given the level of current emissions (Oglethorpe's emissions of carbon dioxide in 2008 totaled about 13 million short tons) and the limited, short-term options available to reduce emissions in the existing generation fleet, the cost to purchase needed allowances may be substantial if this legislation is enacted as proposed.

Oglethorpe could be adversely affected if it is unable to continue to operate its facilities in a successful manner.

The operation of Oglethorpe's generating facilities may be adversely impacted by various factors, including:

•: the risk of equipment failure or operator error;
•: operating limitations that may be imposed by regulatory requirements;
•: compliance with mandatory reliability standards;
•: labor disputes or shortages;
•: fuel, water or material supply interruptions;
•: terrorist attacks; or
•: catastrophic events such as fires, floods, explosions or similar occurrences.

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These or similar negative events could interrupt or limit electric generation or increase the cost of operating Oglethorpe's facilities, which could have the effect of increasing the cost of electric service Oglethorpe provides to its Members and affect their ability to perform their contractual obligations to Oglethorpe.

Changes in fuel prices could have an adverse effect on Oglethorpe's cost of electric service.

Oglethorpe is exposed to the risk of changing prices for fuels, including coal, natural gas and uranium. Oglethorpe has taken steps to manage this exposure by entering into fixed or capped price contracts for some of its coal requirements. Oglethorpe has also entered into natural gas swap arrangements on behalf of some of its Members designed to manage the exposure of those Members to fluctuations in the price of natural gas. The operator of the nuclear plants co-owned by Oglethorpe manages price and supply risk through use of long-term fixed or capped price contracts with multiple vendors of uranium ore mining, conversion and enrichment services. However, these arrangements do not cover all of Oglethorpe's and its Members' risk exposure to increases in the prices of fuels. Therefore, increases in fuel prices could significantly increase the cost of electric service Oglethorpe provides to its Members and affect their ability to perform their contractual obligations to Oglethorpe.

Oglethorpe may not be able to obtain an adequate supply of fuel, which could limit its ability to operate its facilities.

Oglethorpe obtains its fuel supplies, including coal, natural gas and uranium, from a number of different suppliers. Any disruptions in Oglethorpe's fuel supplies, including disruptions due to weather, labor relations, environmental regulations, or other factors affecting Oglethorpe's fuel suppliers, could result in Oglethorpe's having insufficient levels of fuel supplies. For example, rail transportation bottlenecks have from time to time caused transportation companies to be unable to perform their contractual obligations to deliver coal on a timely basis and have resulted in lower than normal coal inventories at certain of Oglethorpe's generating plants. Similar inventory shortages could occur in the future. Natural gas supplies can also be subject to disruption due to natural disasters and similar events. Any failure to maintain an adequate inventory of fuel supplies could require Oglethorpe to operate other generating plants at higher cost or require the Members to purchase higher-cost energy from other sources, and affect their ability to perform their contractual obligations to Oglethorpe.

The financial difficulties faced by other companies could adversely affect Oglethorpe.

Oglethorpe has exposure to many different industries and counterparties, and routinely executes transactions with counterparties in the energy industry, such as coal and natural gas companies, and the financial services industry, including commercial banks, investment banks and other institutions. Many of these transactions expose Oglethorpe to credit risk in the event of default of its counterparty. For example, Oglethorpe enters into hedge agreements to manage a portion of its exposure to fluctuations in the market price of natural gas with several counterparties. If Oglethorpe's counterparties fail or refuse to honor their obligations, Oglethorpe's hedges of the related risk may be ineffective. Any failure could significantly increase the cost of electric service Oglethorpe provides to its Members.

Also, as a result of recent market events, some of Oglethorpe's financial institution counterparties have experienced various degrees of financial distress, including liquidity constraints and credit downgrades. The financial distress of these counterparties may have an adverse effect on Oglethorpe in the event that these counterparties default or otherwise fail to meet their obligations to Oglethorpe. For example, in 2008, the credit downgrades of AMBAC Indemnity Corporation and American International Group, Inc. triggered certain requirements under certain of Oglethorpe's agreements which have now been satisfied. See"MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS—Financial Condition—Off-Balance Sheet Arrangements—Rocky Mountain Lease Arrangements," "—Negative Events In the Capital Markets," and"—Financing Activities" in

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Oglethorpe's 2008 Form 10-K; "FINANCIAL INFORMATION—Management's Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition—Capital Requirements and Liquidity and Sources of Capital—Rocky Mountain Lease Arrangements" in Oglethorpe's Quarterly Report for the quarterly period ended June 30, 2009, filed on August 12, 2009; and Oglethorpe's Current Report on Form ~~10-K~~8-K, dated as of August 19, 2009, filed on August 21, 2009.

Oglethorpe's ability to meet its financial obligations could be adversely affected if Members fail to perform their contractual obligations to Oglethorpe.

Oglethorpe depends primarily on revenue from the Members under the Wholesale Power Contracts to meet its financial obligations. The Members are Oglethorpe's owners and Oglethorpe does not control their operations or financial performance. Further, Members must forecast their load growth and power supply needs. If Members acquire more power supply resources than needed, whether from Oglethorpe or other suppliers, or fail to acquire sufficient supplies, the Members' rates could increase excessively and affect financial performance. As a result of current economic conditions, sales by the Members may not be sufficient to cover current costs without rate increases. Members may not collect all amounts billed to their consumers. Although each Member has financial covenants to set rates to maintain certain margin levels, their rates are not regulated by the Georgia Public Service Commission, pressure from their consumer members not to raise rates excessively could affect financial performance. Thus, Oglethorpe is exposed to the risk that one or more Members could default in the performance of their obligations to Oglethorpe under the Wholesale Power Contracts. Oglethorpe's ability to satisfy its financial obligations could be adversely affected if one or more of the Members, particularly one of the larger Members, defaulted on their payment obligations to Oglethorpe. Although the Wholesale Power Contracts obligate non-defaulting Members to pay the amount of any payment default, pursuant to a pro rata step-up formula, there can be no guarantee that the non-defaulting Members would be able to fulfill this obligation.

Changes in power generation technology could result in the cost of Oglethorpe's electric service being less competitive.

Oglethorpe's business model is to provide the Members with wholesale electric power at the lowest possible cost. Other technologies currently exist or are in development, such as fuel cells, microturbines, windmills and solar cells, that may in the future be capable of producing electric power at costs that are comparable with, or lower than, Oglethorpe's cost of generating power. If these technologies were to develop sufficient economies of scale, the value of Oglethorpe's generating facilities could be adversely affected.

Future deregulation or restructuring of the electric industry in Georgia could subject the Members to increased competition and adversely affect their ability to satisfy their financial obligations to Oglethorpe.

Under current Georgia law, Oglethorpe's Members generally have the exclusive right to provide retail electric service in their respective territories, subject to limited exceptions. Some states have implemented various forms of retail competition among power suppliers. While no legislation concerning retail competition has been enacted or is currently proposed in Georgia, there is no assurance that legislative, regulatory or other changes will not in the future lead to increased competition in the electric industry. If Oglethorpe and its Members are unable to adapt to any of these changes, the prices they charge for electric service could become less competitive. While Oglethorpe provides electric service to its Members under long-term, take-or-pay contracts providing for joint and several liability among the ~~fiscal year ended December 31, 2008.~~Members, if one or more of the Members were to experience significant financial losses as a result of increased competition, the Members may have difficulty performing their obligations to Oglethorpe under their Wholesale Power Contracts.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not Applicable.

Item 3. Defaults upon Senior Securities

Not Applicable.

Item 4. Submission of Matters to a Vote of Security Holders

Not Applicable.

Item 5. Other Information

Gary W. Wyatt, whose current term as an Oglethorpe Director expires March 2010, has notified Oglethorpe of his retirement as the President/Chief Executive Officer of Pataula EMC as of the end of January 2010. Pursuant to Oglethorpe's Bylaws, Mr. Wyatt will cease serving as an Oglethorpe Director immediately upon his retirement from Pataula EMC. The vacancy so created may be temporarily filled by Oglethorpe's Board of Directors. Any Director so appointed shall serve until the next annual meeting of Oglethorpe's Members or any special meeting of Members called for the purpose of filling such position.Not Applicable.

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Item 6. Exhibits

Number		Description

4.1		~~Forty-Eighth~~Forty-Ninth Supplemental Indenture, dated as of ~~August~~November 1, 2009, made by Oglethorpe to U.S. Bank National Association, as trustee, relating to the Oglethorpe Power Corporation First Mortgage Bonds, Series ~~2009B CFC Note, Series 2009C CFC Note and Series 2009D CFC Project Note.~~2009 B.
~~4.2~~⁽¹⁾10.1		~~Committed, Revolving Credit Facility~~Employment Agreement, dated as of August 1,17, 2009, between Oglethorpe and ~~National Rural Utilities Cooperative Finance Corporation, relating to the Series 2009B CFC Note.~~
~~4.3~~⁽¹⁾		~~Series 2009B CFC Note, dated August 11, 2009, in the original principal amount of $250,000,000, from Oglethorpe to National Rural Utilities Cooperative Finance Corporation.~~
~~4.4~~⁽¹⁾		~~Term Loan Agreement, dated as of August 1, 2009, between Oglethorpe and National Rural Utilities Cooperative Finance Corporation, relating to the Series 2009C CFC Note.~~
~~4.5~~⁽¹⁾		~~Series 2009C CFC Note, dated August 11, 2009, in the original principal amount of $250,000,000, from Oglethorpe to National Rural Utilities Cooperative Finance Corporation.~~Charles W. Whitney.
31.1		Rule 13a-14(a)/15d-14(a) Certification, by Thomas A. Smith (Principal Executive Officer).
31.2		Rule 13a-14(a)/15d-14(a) Certification, by Elizabeth B. Higgins (Principal Financial Officer).
32.1		Certification Pursuant to 18 U.S.C. 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by Thomas A. Smith (Principal Executive Officer).
32.2		Certification Pursuant to 18 U.S.C. 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by Elizabeth B. Higgins (Principal Financial Officer).

⁽¹⁾: ~~Pursuant to 17 C.F.R. 229.601(b)(4)(iii), this document(s) is not filed herewith; however the registrant hereby agrees that such document(s) will be provided to the Commission upon request.~~

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		Oglethorpe Power Corporation (An Electric Membership Corporation)
Date: ~~August~~November 12, 2009	By:	/s/ Thomas A. Smith Thomas A. Smith President and Chief Executive Officer
Date: ~~August~~November 12, 2009		/s/ Elizabeth B. Higgins Elizabeth B. Higgins Executive Vice President and Chief Financial Officer (Principal Financial Officer)


				(dollars in thousands)
			Three Months						Six Months
			2009			2008			2009			2008
Operating revenues:
	Sales to Members		$	300,527		$	319,045		$	582,232		$	610,355
	Sales to non-Members			332			240			640			573

		Total operating revenues		300,859			319,285			582,872			610,928

Operating expenses:
	Fuel			98,592			119,903			187,166			218,790
	Production			69,269			69,052			140,033			138,798
	Purchased power			34,050			43,101			59,196			79,499
	Depreciation and amortization			32,827			29,813			63,711			59,537
	Accretion			4,566			4,272			9,131			8,575
	Other			(47	)		(325	)		(47	)		(327	)

		Total operating expenses		239,257			265,816			459,190			504,872

Operating margin				61,602			53,469			123,682			106,056

Other income (expense):
	Investment income			8,561			7,823			16,063			16,689
	Other			2,308			2,444			5,266			5,105

		Total other income		10,869			10,267			21,329			21,794

Interest charges:
	Interest on long-term debt and capital leases			59,439			53,378			115,575			109,006
	Other interest			587			476			1,204			858
	Allowance for debt funds used during construction			(4,739	)		(2,813	)		(8,544	)		(5,149	)
	Amortization of debt discount and expense			4,375			3,877			8,320			7,650

		Net interest charges		59,662			54,918			116,555			112,365

Net margin			$	12,809		$	8,818		$	28,456		$	15,485


		Three Months Ended June 30, 2009
			Decommissioning funds		Long-term investments			Deposit on Rocky Mountain transactions		Investments in associated companies

			(dollars in thousands)
Assets:
Balance at March 31, 2009		$	1,440	$	29,619		$	110,044	$	43,845
Total gains or losses (realized/unrealized):
	comprehensive deficit		—		(120	)		—		—
Purchases, issuances, liquidations			—		(200	)		—		—
Transfers to Level 3			7,221		—			1,824		9,646

Balance at June 30, 2009		$	8,661	$	29,299		$	111,868	$	53,491


			Three Months Ended June 30, 2008
				Decommissioning funds			Long-term investments			Deposit on Rocky Mountain transactions		Investments in associated companies

Assets:
Balance at March 31, 2008			$	985		$	51,165		$	102,981	$	45,217
Total gains or losses (realized/unrealized):
	Included in earnings			(46	)		—			—		—
	Included in regulatory asset			(50	)		—			—		—
		comprehensive deficit		—			(1,589	)		—		—
Purchases, issuances, liquidations				—			(15,000	)		—		—
Transfers to Level 3				(827	)		—			1,708		(368	)

Balance at June 30, 2008			$	62		$	34,576		$	104,689	$	44,849


		Six Months Ended June 30, 2008
			Decommissioning funds			Long-term investments			Deposit on Rocky Mountain transactions		Investments in associated companies

Assets:
Balance at January 1, 2008		$	1,342		$	7,300		$	101,272	$	46,449
Total gains or losses (realized/unrealized):
	Included in earnings		(96	)		—			—		—
	Included in regulatory asset		(30	)		—			—		—
	Impairment included in other comprehensive deficit		—			(4,024	)		—		—
Purchases, issuances, liquidations			—			(15,000	)		—		—
Transfers to Level 3			(1,154	)		46,300			3,417		(1,600	)

Balance at June 30, 2008		$	62		$	34,576		$	104,689	$	44,849



	Regulatory Assets					Liability Derivatives
		Balance Sheet Location		Fair Value		Balance Sheet Location		Fair Value

		(dollars in thousands)
Derivatives designated as hedging instruments under SFAS No. 133:
Commodity contracts (Natural Gas Swaps)		Receivables	$	29,559		Other Current Liabilities	$	29,559
Commodity contracts (Natural Gas Swaps)		Receivables		(1	)	Other Current Liabilities		(1	)

Total Derivatives designated as hedging instruments under SFAS No. 133			$	29,558			$	29,558


Effect of Derivative Instruments on the Condensed Statement of Revenues and Expenses
Derivatives in SFAS No. 133 Fair Value Hedging Relationships			Three months ended			Six months ended

			(dollars in thousands)
	Commodity contracts (Natural Gas Swaps)	$	—		$	46
	Commodity contracts (Natural Gas Swaps)		(7,477	)		(9,556	)

Total		$	(7,477	)	$	(9,510	)



		Pro forma Six Months Ended June 30, 2009		Pro forma Six Months Ended June 30, 2008

		(in thousands)
Operating Revenues	$	584,947	$	613,553
Net Margin	$	28,456	$	15,485



	Three Months Ended June 30,				Six Months Ended June 30,
	2009		2008		2009		2008
Capacity revenues	$	165,197	$	150,000	$	329,160	$	300,478
Energy revenues		135,330		169,045		253,072		309,877

Total	$	300,527	$	319,045	$	582,232	$	610,355

Kilowatt hours sold to Members		5,181,861		5,913,146		10,013,239		11,262,060
Cents per kilowatt hour		5.80¢		5.40¢		5.81¢		5.42¢