Company: TVC
Filing Date: 2025-07-29
Form Type: 10-Q
Source: 0001376986-25-000044
Chunk: 467

Company: Tennessee Valley Authority
Filing Date: 2025-07-29
Form: 10-Q
Item: Part II, Item 5
Chunk 467
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 net completed plant.

Tax equivalents expense increased $25 million for the three months ended June 30, 2025, as compared to the same period of the prior year.  This change is primarily driven by an increase in TVA's revenue from sales of electricity in 2024, which is used as the basis for calculating tax equivalent expense.

Nine Months Ended June 30, 2025, Compared to Nine Months Ended June 30, 2024

Fuel expense increased $113 million for the nine months ended June 30, 2025, as compared to the same period of the prior year.  An increase of $192 million was due primarily to higher effective fuel rates related 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.  Partially offsetting this increase was a decrease of $42 million due to less availability of nuclear generation and more availability of hydro generation as compared to the same period of the prior year.  Additionally, fuel expense decreased $37 million related to the deferral of unplanned coal and gas costs due to less availability of nuclear generation.

Purchased power expense increased $377 million for the nine months ended June 30, 2025, as compared to the same period of the prior year.  This increase was primarily due to higher demand for energy and less availability of TVA nuclear generation, resulting in an increase of $358 million.

Operating and maintenance expense increased $100 million for the nine months ended June 30, 2025, as compared to the same period of the prior year.  This increase was primarily due to $113 million of increased payroll and benefit costs primarily due to severance costs associated with ETP efforts and labor escalation for cost of living increases.  In addition, there was a $36 million increase in outage expense primarily due to an increase in nuclear outage days.  Partially offsetting these increases was a $27 million decrease in expenditures related to project contract labor primarily due to higher power operations performance activities and other natural gas project work in the prior year.

Depreciation and amortization expense increased $98 million for the nine months ended June 30, 2025, as compared to the same period of the prior year.  The increase was primarily driven by an increase of $33 million related to amortization expense of finance leases and amortization expense of decommissioning costs recovered in rates and an increase in depreciation expense of $18 million related to the decision in April 202