Company: TVC
Filing Date: 2025-11-13
Form Type: 10-K
Source: 0001376986-25-000056
Chunk: 449

Company: Tennessee Valley Authority
Filing Date: 2025-11-13
Form: 10-K
Item: Item 7
Chunk 449
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$232 $11 $14 $9 Note  (1)  The components of total benefit cost other than the service cost component are included in Other net periodic benefit cost on the Consolidated Statements of Operations.(2)  Special/contractual termination benefits for certain eligible employees related to TVA's restructuring activities. See Note 3 — Restructuring.

Plan Assumptions

Plan assumptions utilized to determine benefit obligations and net periodic benefit costs include discount rates, projected health care cost trend rates, COLAs, expected long-term rate of return on plan assets, rate of increase in future compensation levels, retirement rates, expected timing and form of payments, and mortality rates, of which certain key assumptions are noted below.  Every five years, a formal actuarial experience study that compares assumptions to the actual experience is conducted. Additional ad-hoc experience studies are performed as needed to review recent experience and validate recommended changes to the actuarial assumptions used based upon TVA's latest experience study in 2023.

Actuarial Assumptions Utilized to Determine Benefit Obligations at September 30 Pension BenefitsOther Post-Retirement Benefits 2025202420252024Discount rate5.47%4.95%5.62%5.00%Average rate of compensation increase3.97%4.01%N/AN/AWeighted average interest crediting rate5.11%5.13%N/AN/ACost of living adjustment (COLA)(1)2.00%2.00%2.00%2.00%Pre-Medicare eligible per capita claim costsCurrent health care cost trend rateN/AN/A7.75%7.25%Ultimate health care cost trend rateN/AN/A5.00%5.00%Year ultimate trend rate is reachedN/AN/A20362034Pre-Medicare eligible per capita contributionsCurrent health care cost trend rateN/AN/A7.75%7.25%Ultimate health care cost trend rateN/AN/A5.00%5.00%Year ultimate trend rate is reachedN/AN/A20362034Post-Medicare eligibleCurrent health care cost trend rateN/AN/A—%—%Ultimate health care cost trend rateN/AN/A4.00%4.00%Year ultimate trend rate is reachedN/AN/A20292026

Note

(1)  The COLA assumption rate is the ultimate long-term rate.