Company: TVC
Filing Date: 2025-11-13
Form Type: 10-K
Source: 0001376986-25-000056
Chunk: 390

Company: Tennessee Valley Authority
Filing Date: 2025-11-13
Form: 10-K
Item: Item 7
Chunk 390
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 leases were as follows:

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Weighted AveragesAt September 3020252024Weighted average remaining lease termsOperating leases3 years4 years   Finance leases(1)8 years9 yearsWeighted average discount rate(2)Operating leases4.2%4.3%Finance leases17.0%17.6%Note(1)  One of TVA's finance leases includes an option period to extend, which TVA is reasonably certain to exercise.(2)  The discount rate is calculated using the rate implicit in a lease if it is readily determinable.  If the rate used by the lessor is not readily determinable, TVA uses its incremental borrowing rate as permitted by accounting guidance.  The incremental borrowing rate is influenced by TVA's credit rating and lease term and as such may differ for individual leases, embedded leases, or portfolios of leased assets.    The following table presents maturities of lease liabilities and a reconciliation of the undiscounted cash flows to lease liabilities at September 30, 2025:Future Minimum Lease PaymentsMinimum payments outstanding at September 30, 2025(in millions)Operating leases2026$50 202735 202819 20294 20302 Thereafter6 Minimum annual payments116 Less: present value discount(7)Operating present value of net minimum lease payments$109 Finance leases2026$144 2027142 2028137 2029134 2030133    Thereafter340 Minimum annual payments1,030 Less: amount representing interest(304)Finance present value of net minimum lease payments$726 TVA has entered into three PPAs with renewable resource providers for solar generation and rights to charge and discharge battery energy storage systems.  The systems are considered a lease component in these agreements.  These PPAs have terms of 15 - 20 years and are expected to commence between January 2026 and December 2028.  Total capacity payments related to these batteries over the term of these PPAs are expected to total $862 million.

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10.  Other Long-Term Assets 

The table below summarizes the types and amounts of TVA's other long-term assets:Other Long-Term Assets At September 30(in millions) 20252024Cloud assets$114 $35 Prepaid long-term service agreements89 62 Loans and other long-term receivables, net83 84 Prepaid capital assets81 29 Energy