Company: EAI
Filing Date: 2025-08-01
Form Type: 10-Q
Source: 0000065984-25-000087
Chunk: 358

Company: ENTERGY ARKANSAS, LLC
Filing Date: 2025-08-01
Form: 10-Q
Item: Item 1
Chunk 358
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 In addition, Entergy Louisiana records a regulatory charge or credit for the difference between asset retirement obligation-related expenses and nuclear decommissioning trust earnings plus asset retirement obligation-related costs collected in revenue.  See Note 2 to the financial statements in the Form 10-K for discussion of the agreement in principle and the subsequently filed global stipulated settlement agreement.

Other income increased primarily due to:

•an increase in the allowance for equity funds used during construction due to higher construction work in progress in 2025, including the projects for new generation resources in north Louisiana;

•a $17.1 million true-up of Entergy Louisiana's MISO cost recovery mechanism over-recovery balance to the 2024 formula rate plan filing, which was filed with the LPSC in May 2025.  See Note 2 to the financial statements herein for discussion of the 2024 formula rate plan filing;

•an increase of $14.2 million in interest earned on money pool investments; and

•an increase of $13.4 million in the amortization of tax gross ups on customer advances for construction.

The increase was offset by changes in decommissioning trust fund activity, including portfolio rebalancing of the River Bend decommissioning trust fund in 2024, and a decrease of $8.7 million in affiliated dividend income from affiliated preferred membership interests related to storm cost securitization.

Interest expense increased primarily due to the issuance of $700 million of 5.15% Series mortgage bonds in August 2024, the issuance of $750 million of 5.80% Series mortgage bonds in January 2025, and carrying costs of $12.1 million in 2025 on customer advances for construction.  The increase was partially offset by an increase in the allowance for borrowed funds used during construction due to higher construction work in progress in 2025.

Income Taxes

The effective income tax rates were 19.5% for the second quarter 2025 and 18.6% for the six months ended June 30, 2025.  The differences in the effective income tax rates for the second quarter 2025 and the six months ended June 30, 2025 versus the federal statutory rate of 21% were primarily due to the book and tax differences related to the non-taxable income distributions earned on preferred membership interests, book and tax differences related to the allowance for equity funds used during construction, and certain book and tax differences related to utility plant items, partially offset by the accrual