Company: EAI
Filing Date: 2025-08-01
Form Type: 10-Q
Source: 0000065984-25-000087
Chunk: 217

Company: ENTERGY ARKANSAS, LLC
Filing Date: 2025-08-01
Form: 10-Q
Item: Item 7
Chunk 217
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 the subsequently filed global stipulated settlement agreement.  In addition, Entergy 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.

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 Orange County Advanced Power Station project and the Legend Power Station project, each at Entergy Texas;

•a $17 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 $9 million in the amortization of tax gross ups on customer advances for construction.

The increase was partially offset by changes in decommissioning trust fund activity, including portfolio rebalancing of decommissioning trust funds in second quarter 2024.

Interest expense increased primarily due to:

•the issuance by Entergy Louisiana of $700 million of 5.15% Series mortgage bonds in August 2024;

•the issuance by Entergy Louisiana of $750 million of 5.80% Series mortgage bonds in January 2025;

•the issuance by Entergy Mississippi of $600 million of 5.80% Series mortgage bonds in March 2025;

•the issuance by Entergy Texas of $500 million of 5.25% Series mortgage bonds in February 2025; and

•carrying costs of $10 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, including the Orange County Advanced Power Station project and the Legend Power Station project, each at Entergy Texas.

Parent and Other

Other income (deductions) increased primarily due to a $317 million ($250 million net-of-tax) non-cash settlement charge recognized in second quarter 2024 as a result of a group annuity contract purchased in May 2024 to settle certain pension liabilities.  See Note 11 to the financial statements in the Form 10-K for discussion of the group annuity contract and settlement charge.

Income Taxes

The effective income tax rate was 22.7% for the second quarter 2025.  The difference