Company: TVC
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001376986-25-000029
Chunk: 162

Company: Tennessee Valley Authority
Filing Date: 2025-05-01
Form: 10-Q
Item: Part II, Item 3
Chunk 162
---
783 5.9 %Average blended interest rate(3)4.97 %4.90 %1.4 %4.98 %4.90 %1.6 %

Notes

(1)  Includes amortization of debt discounts, issuance, and reacquisition costs, net.

(2)  Includes average balances of long-term power bonds, debt of variable interest entities ("VIEs"), and discount notes.

(3)  Includes interest on long-term power bonds, debt of VIE, and discount notes.

Total interest expense increased $27 million for the three months ended March 31, 2025, as compared to the same period of the prior year.  This increase was primarily driven by a $13 million increase in interest on other financing leases, primarily the new lease financing arrangement with Johnsonville Aeroderivative Combustion Turbine Generation LLC ("JACTG"), a $10 million increase from higher average balances of long-term debt, and a $6 million increase from higher average rates on long-term debt.  This increase was partially offset by a $2 million decrease in interest on short-term debt primarily due to lower rates. 

Total interest expense increased $45 million for the six months ended March 31, 2025, as compared to the same period of the prior year.  This increase was primarily driven by a $25 million increase in interest on other financing leases, primarily the new lease financing arrangement with JACTG, a $12 million increase from higher average rates on long-term debt, a $10 million increase from higher average balances of long-term debt, and a $2 million increase from higher average balances of short-term debt.  This increase was partially offset by a $4 million decrease in interest on short-term debt primarily due to lower rates.

Liquidity and Capital Resources 

Sources of Liquidity

TVA depends on various sources of liquidity to meet cash needs and contingencies.  TVA's primary sources of liquidity are cash from operations and proceeds from the issuance of short-term debt in the form of discount notes, along with periodic issuances of long-term debt.  TVA's balance of short-term debt typically changes frequently as TVA issues discount notes to meet short-term cash needs and pay scheduled maturities of discount notes and long-term debt.  TVA’s next significant power bond maturity is $1.0 billion in May 2025.  The periodic amounts of short-term debt issued are determined by near-term expectations for