$FMKT: How Deregulation Could Supercharge Southern Company
Regulators need to cut red tape for power plants to get built faster. Plain and simple. That’s one of the reasons why The Free Markets ETF (FMKT) positioned into Southern Company (SO). FMKT’s investment objective is to seek long-term capital appreciation by investing in companies that are highly sensitive to changes in regulation. Southern fits the bill: It’s a giant utility in the Southeast, and its growth prospects depend on how quickly it can construct, upgrade and run its grid².
Southern Company serves millions of electric and gas customers in Georgia, Alabama and Mississippi³. It has regulated utilities, transmission networks and an expanding array of gas and nuclear power. In 2025, it laid out a $76 billion capital plan to add generation and modernize infrastructure⁴. Under traditional regulation, projects like these can face delays—environmental reviews, federal signoffs, and multi-year rate cases. Deregulation aims to reduce those hurdles and free up capital deployment.
That shift is already underway. In June the White House issued an executive order directing a rollback of what was described as “burdensome” rules related to energy⁵. EPA and Department of Energy, for their part, responded by expediting proposed reforms in the air, water, and nuclear permitting process⁶. For companies like Southern, this can translate into less time lost and fewer compliance costs for adding new power plants or retrofitting old ones.
It’s more than an abstraction; a case in point is Georgia’s recent green-light to Southern’s 10-year energy strategy. Regulators approved the addition of 7 gigawatts of new generating capacity⁶ — and without insistence on another full rate case until 2028⁷. Such regulatory clarity is not a federal policy shift, but seems to represent a wider trend in rulemaking and deregulatory ambiance now taking hold in crucial states.
Southern is also benefiting from trends in demand. New data centers and industrial facilities in the Southeast are driving up electricity use. In its latest filings, Southern has disclosed an 3% increase for the retail power sales and double digit growth in data center load⁸. This demand means there is a need for more capacity, and deregulation, and if it sticks, makes it easier for the airline to react.
FMKT views this as a confluence of tailwinds: less regulatory headwind, increasing demand and a utility with significant runway of approved investment. Of course, there are risks. Regulatory priorities can turn on a dime in the short-sighted world of politics, and energy infrastructure is both complex and capital-intensive. That said, Southern’s place in the fund does convey a clear thesis: when the rules become simpler, capital-intensive companies like SO can operate more efficiently. For investors who are aligned with FMKT’s strategy, it’s a company worth keeping an eye on.
Footnotes:
“Free Markets ETF Overview,” Free Markets ETF,
https://www.freemarketsetf.com.
“Southern Company 2025 Investor Presentation,” Southern Company, https://investor.southerncompany.com.
“About Us,” Southern Company, https://www.southerncompany.com/about-us.html.
Ibid.
“Executive Order on American Energy Independence,” The White House, January 2025.
“EPA to Roll Back Power Plant Rules,” Reuters, March 2025.
“Georgia PSC Approves Southern Co. Energy Plan,” Utility Dive, July 2025.
“Southern Company Q2 2025 Earnings Release,” Southern Company Investor Relations.
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Deregulation Strategy Risks.The Fund’s strategy of investing in companies that may benefit from deregulatory measures entails significant risks, including those stemming from the unpredictable nature of regulatory trends. Deregulation is influenced by political, economic, and social factors, which can shift rapidly and in unforeseen directions. Changes in government priorities, political leadership, or public sentiment may result in the reversal of existing deregulatory policies or the introduction of new regulations that could adversely affect certain industries or companies. Further, while the Fund invests in companies expected to benefit from deregulatory initiatives, not all of these companies may achieve the expected advantages, whether fully, partially, or at all. The actual impact of deregulatory measures may vary widely depending on a company’s specific operational, financial, and competitive circumstances. Companies may also face challenges adapting to new regulatory environments, or their competitive positioning may be undermined by other market factors unrelated to deregulation. These risks could negatively affect the performance of the Fund’s portfolio.
Underlying Digital Assets ETP Risks. The Fund’s investment strategy, involving indirect exposure to Bitcoin, Ether, or any other Digital Assets through one or more Underlying ETPs, is subject to the risks associated with these Digital Assets and their markets. These risks include market volatility, regulatory changes, technological uncertainties, and potential financial losses. As with all investments, there is no assurance of profit, and investors should be cognizant of these specific risks associated with digital asset markets.
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● Digital Assets Risk: Digital Assets like Bitcoin and Ether, designed as mediums of exchange or for utility purposes, are an emerging asset class. Operating independently of any central authority or government backing, they face extreme price volatility and regulatory scrutiny. Trading platforms for Digital Assets remain largely unregulated and prone to fraud and operational failures compared to traditional exchanges. Platform shutdowns, whether due to fraud, technical issues, or security breaches, can significantly impact prices and market stability.
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● Blockchain Technology Risk: Blockchain technology underpins Bitcoin, Ether, and other digital assets, yet it remains a relatively new and largely untested innovation. Competing platforms, changes in adoption rates, and technological advancements in blockchain infrastructure can affect their functionality and relevance. For Ether, the dependence on its proof-of-stake mechanism and smart contract capabilities introduces risks tied to network performance and scalability. Investments in blockchain-dependent companies or vehicles may experience market volatility and lower trading volumes. Furthermore, regulatory changes, cybersecurity incidents, and intellectual property disputes could undermine the adoption and stability of blockchain technologies.
Recent Market Events Risk. U.S. and international markets have experienced and may continue to experience significant periods of volatility in recent years and months due to a number of economic, political and global macro factors including uncertainty regarding inflation and central banks’ interest rate changes, the possibility of a national or global recession, trade tensions and tariffs, political events, war and geopolitical conflict. These developments, as well as other events, could result in further market volatility and negatively affect financial asset prices, the liquidity of certain securities and the normal operations of securities exchanges and other markets, despite government efforts to address market disruptions.
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