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Heat a large stock pot or dutch oven over medium heat. Add bacon and cook until crispy. Remove bacon and set aside. Reserve some bacon for garnishing. Drain grease drippings.
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Add butter to the pot and melt over medium heat. Add onions and cook until transparent.
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Add flour to the pot, stirring constantly, about 1-minute. Whisk in chicken broth. Cook, stirring constantly about 4 minutes. Add milk.
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Add potatoes, bacon and one cup of cheese and stir well. Cook over medium until soup comes to a boil.
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Once soup comes to a boil, lower and cook about 45 minutes until potatoes are tender.
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Garnish with remaining cheese, scallions, and bacon.