Company: EAI
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0000065984-25-000132
Chunk: 416

Company: ENTERGY ARKANSAS, LLC
Filing Date: 2025-10-31
Form: 10-Q
Item: Item 1
Chunk 416
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 Units 1 and 2 project;

•an increase of $24.5 million in the amortization of tax gross ups on customer advances for construction;

•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; and

•an increase of $21.1 million in interest earned on money pool investments.

The increase was offset by a decrease of $13.1 million in affiliated dividend income from affiliated preferred membership interests related to storm cost securitizations.

Interest expense increased primarily due to the issuance of $750 million of 5.80% Series mortgage bonds in January 2025, the issuance of $700 million of 5.15% Series mortgage bonds in August 2024, and carrying costs of $24.4 million in 2025 on customer advances for construction.  The increase was partially offset by an increase in the 

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Table of ContentsEntergy Louisiana, LLC and SubsidiariesManagement’s Financial Discussion and Analysis

allowance for borrowed funds used during construction due to higher construction work in progress in 2025, including the Franklin Farms Power Station Units 1 and 2 project.

Income Taxes

The effective income tax rates were 19.5% for the third quarter 2025 and 19% for the nine months ended September 30, 2025.  The differences in the effective income tax rates for the third quarter 2025 and the nine months ended September 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, partially offset by the accrual for state income taxes.

The effective income tax rate was 22.6% for the third quarter 2024.  The difference in the effective income tax rate for the third quarter 2024 versus the federal statutory rate of 21% was primarily due to the accrual for state income taxes and the amortization of state accumulated deferred income taxes as a result of tax rate changes, partially offset by the book and tax differences related to the non-taxable income distributions earned on preferred membership interests and certain book and tax differences related to utility plant items.

The effective income tax rate was 19.6% for the