Company: TVC
Filing Date: 2025-07-29
Form Type: 10-Q
Source: 0001376986-25-000044
Chunk: 221

Company: Tennessee Valley Authority
Filing Date: 2025-07-29
Form: 10-Q
Item: Part I, Item 1
Chunk 221
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10.7 %Average blended debt balance(2)$22,775 $21,020 8.3 %$22,270 $20,862 6.7 %Average blended interest rate(3)5.11 %4.91 %4.1 %5.03 %4.90 %2.7 %

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 $40 million for the three months ended June 30, 2025, as compared to the same period of the prior year.  This increase was primarily driven by a $32 million increase from higher average balances and rates on long-term debt, and a $17 million increase in interest on other financing leases, primarily the new lease financing arrangement with Johnsonville Aeroderivative Combustion Turbine Generation LLC ("JACTG").  This increase was partially offset by a $9 million decrease in interest on short-term debt primarily due to lower average balances and rates. 

Total interest expense increased $85 million for the nine months ended June 30, 2025, as compared to the same period of the prior year.  This increase was primarily driven by a $54 million increase from higher average balances and rates on long-term debt, and a $41 million increase in interest on other financing leases, primarily the new lease financing arrangement with JACTG.  This increase was partially offset by a $10 million decrease in interest on short-term debt primarily due to lower average balances and 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 $1.4 billion in November 2025.  The periodic amounts of short-term debt issued are determined by near-term