Company: TVC
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001376986-25-000029
Chunk: 157

Company: Tennessee Valley Authority
Filing Date: 2025-05-01
Form: 10-Q
Item: Part II, Item 3
Chunk 157
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 coal and natural gas generation due to less availability of nuclear generation as compared to the same period of the prior year.

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Table of Contents                               Draft 4.0                    04/24/2025 5:00 PM

Purchased power expense increased $200 million for the three months ended March 31, 2025, as compared to the same period of the prior year.  This increase was primarily due to higher demand for energy with less availability of TVA nuclear generation, resulting in an increase of $276 million.  Partially offsetting this increase was a $73 million decrease in purchased power expense from lower purchased power market prices compared to the same period of the prior year.

Operating and maintenance expense increased $55 million for the three months ended March 31, 2025, as compared to the same period of the prior year.  This increase was primarily due to $71 million of increased payroll and benefit costs primarily due to severance costs associated with ETP efforts and labor escalation for cost of living increases.  Partially offsetting these increases was an $11 million decrease in outage expense primarily due to the Sequoyah Nuclear Plant Unit 2 outage for the main generator capital project and an $8 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 $32 million for the three months ended March 31, 2025, as compared to the same period of the prior year.  The increase was primarily driven by an increase in depreciation expense of $10 million related to the decision in April 2024 to retire Kingston and a $9 million increase in amortization expense of finance leases and amortization expense of decommissioning costs recovered in rates.  Additionally, there was an increase due to depreciation of additions to net completed plant.  

Tax equivalents expense increased $17 million for the three months ended March 31, 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.

Six Months Ended March 31, 2025, Compared to Six Months Ended March 31, 2024

Fuel expense decreased $52 million for the six months ended March 31, 2025, as compared to the same period of the prior year.  A