Company: TVC
Filing Date: 2025-11-13
Form Type: 10-K
Source: 0001376986-25-000056
Chunk: 236

Company: Tennessee Valley Authority
Filing Date: 2025-11-13
Form: 10-K
Item: Item 1
Chunk 236
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 only for (1) minimum payments into the U.S. Treasury required by the TVA Act as repayment of, and as a return on, the Power Program Appropriation Investment; (2) investment in power system assets; (3) additional reductions of TVA's capital obligations; and (4) other lawful purposes related to TVA's power business.The TVA Act and the Basic Resolution each contain two bond tests: the rate test and the bondholder protection test.  Under the rate test, TVA must charge rates for power which will produce gross revenues sufficient to provide funds for, among other things, debt service on outstanding Bonds.  As of September 30, 2025, TVA was in compliance with the rate test.  Under the bondholder protection test, TVA must, in successive five-year periods, use an amount of net power proceeds at least equal to the sum of (1) the depreciation accruals and other charges representing the amortization of capital expenditures and (2) the net proceeds from any disposition of power facilities for either the reduction of its capital obligations (including Bonds and the Power Program Appropriation Investment) or investment in power assets.  TVA met the bondholder protection test for the five-year period ended September 30, 2025 and must next meet the bondholder protection test for the five-year period ending September 30, 2030.Secured Debt of VIEs  In October 2024, JACTG issued secured notes totaling $720 million that bear interest at a rate of 5.078 percent.  Also in October 2024, JHLLC issued secured notes totaling $80 million that bear interest at a rate of 5.74 percent.  The JACTG notes and the JHLLC notes require amortizing semi-annual payments on each April 1, and October 1, and mature on October 1, 2054.  See Note 12 — Variable Interest Entities — Johnsonville  VIEs.  TVA used the proceeds from the transaction primarily to fund the construction of the Johnsonville Facility.

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In August 2013, SCCG issued secured notes totaling $360 million that bear interest at a rate of 3.846 percent.  The SCCG notes require amortizing semi-annual payments on each February 15 and August 15, and mature on August 15, 2033.  Also in August 2013, SCCG issued $40 million of