Company: TVC
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001376986-25-000029
Chunk: 338

Company: Tennessee Valley Authority
Filing Date: 2025-05-01
Form: 10-Q
Item: Part II, Item 2
Chunk 338
---
, and related services sector and an increase in heating degree days.  The increase in effective base rates was primarily due to the TVA Board action to approve a 5.25 percent wholesale base rate increase effective October 1, 2024.  In addition, there was a $120 million increase in fuel cost recovery revenue driven by a $71 million increase attributable to higher effective fuel rates and a $49 million increase attributable to higher sales volume.  The higher fuel rates were due primarily to using higher cost coal and natural gas generation due to less availability of nuclear generation as compared to the same period of the prior year.

Operating revenues increased $533 million for the six months ended March 31, 2025, as compared to the same

period of the prior year, primarily due to a $362 million increase in base revenue.  The $362 million increase in base revenue was driven by a $202 million increase attributable to higher sales volume and a $160 million increase attributable to higher effective base rates.  The higher sales volume was driven primarily by increases within the data processing, hosting, and related services sector and an increase in heating degree days.  The increase in effective base rates was primarily due to the TVA Board action to approve a 5.25 percent wholesale base rate increase effective October 1, 2024.  In addition, there was a $167 million increase in fuel cost recovery revenue driven by a $103 million increase attributable to higher effective fuel rates and a $64 million increase attributable to higher sales volume.  The higher fuel rates were due primarily to using higher cost coal and natural gas generation due to less availability of nuclear generation as compared to the same period of the prior year.

See Sales of Electricity above for further discussion of the change in the volume of sales of electricity and Operating Expenses below for further discussion of the change in fuel expense.

46

Table of Contents                               Draft 4.0                    04/24/2025 5:00 PM

Operating Expenses.  Operating expense components as a percentage of total operating expenses for the three and six months ended March 31, 2025 and 2024, consisted of the following:

Operating Expenses(in millions)Three Months Ended March 31Six Months Ended March 3120252024ChangePercent Change20252024ChangePercent ChangeOperating expensesFuel$580 $641 $(61)(9.5)%$1,085 $1,137 $(52)(4.6)%Purchased power