Company: TVC
Filing Date: 2025-02-05
Form Type: 10-Q
Source: 0001376986-25-000011
Chunk: 4

Company: Tennessee Valley Authority
Filing Date: 2025-02-05
Form: 10-Q
Item: Part II, Item 13
Chunk 4
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 Risk aggregate transaction limit under the current FHP structure, but the TVA Board reviews and authorizes the use of tolerances and measures annually.  TVA's FHP policy prohibits trading financial instruments under the FHP for speculative purposes.  At December 31, 2024, TVA's natural gas swap contracts under the FHP had remaining terms of up to three years.Commodity Derivatives under Financial Hedging Program(1)At December 31, 2024At September 30, 2024Number of ContractsNotional AmountFair Value (MtM)(in millions)Number of ContractsNotional AmountFair Value (MtM)(in millions)Natural gas swap contracts173280 million mmBtu$(75)126230 million mmBtu$(161)Note(1)  Fair value amounts presented are based on the net commodity position with the counterparty.  Notional amounts disclosed represent the net value of contractual amounts.TVA defers all FHP unrealized gains (losses) as regulatory liabilities (assets) and records the realized gains or losses in Fuel expense and Purchased power expense to match the delivery period of the underlying commodity. 

25

Offsetting of Derivative Assets and LiabilitiesThe amounts of TVA's derivative instruments as reported on the Consolidated Balance Sheets are shown in the table below:Derivative Assets and Liabilities(1)(in millions) At December 31, 2024At September 30, 2024AssetsCommodity contract derivatives$12 $7 Commodity derivatives under the FHP(2)6 — Total derivatives subject to master netting or similar arrangement$18 $7 LiabilitiesCurrency swaps$136 $116 Interest rate swaps(3)635 840 Commodity contract derivatives 6 5 Commodity derivatives under the FHP(2)81 161 Total derivatives subject to master netting or similar arrangement$858 $1,122  Notes(1)  Offsetting amounts include counterparty netting of derivative contracts.  Except as discussed below, there were no other material offsetting amounts on TVA's Consolidated Balance Sheets at either December 31, 2024, or September 30, 2024. (2)  At December 31, 2024, the gross derivative asset and gross derivative liability were $31 million and $106 million, respectively, with offsetting amounts for each totaling $25 million.  At September