Company: EAI
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0000065984-25-000132
Chunk: 218

Company: ENTERGY ARKANSAS, LLC
Filing Date: 2025-10-31
Form: 10-Q
Item: Item 4
Chunk 218
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orem taxes resulting from higher assessments.

Depreciation and amortization expenses increased primarily due to additions to plant in service.

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 Legend Power Station project and the Orange County Advanced Power Station project.

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Table of ContentsEntergy Texas, Inc. and SubsidiariesManagement’s Financial Discussion and Analysis

Interest expense increased primarily due to the issuance of $500 million of 5.25% Series mortgage bonds in February 2025 and the issuance of $350 million of 5.55% Series mortgage bonds in August 2024, 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 Legend Power Station project and the Orange County Advanced Power Station project.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

Purchased power includes an increase in 2025 of $28.9 million in costs related to the procurement of capacity through MISO’s annual planning resource auction, including the effect of a significant increase in MISO’s seasonal auction clearing price, due to the implementation of a reliability-based demand curve, for capacity transactions during the summer months.  Although Entergy Texas does not have the ability to recover its MISO capacity costs incurred to date beyond the level included in base rates, in June 2025, Texas legislation established a capacity cost recovery rider mechanism that would allow for the recovery of costs related to the procurement of capacity through MISO’s annual planning resource auction outside of base rates, through a rider that is updated annually.  Entergy Texas plans to file for such a rider to recover future capacity procurement costs at the earliest opportunity in 2026.

Other operation and maintenance expenses increased primarily due to:

•an increase of $4.5 million in loss provisions;

•an increase of $3.3 million in bad debt expense;

•an increase of $2.7 million in power delivery expenses primarily due to higher vegetation maintenance costs;

•an increase of $1.9 million in transmission costs allocated by MISO;

•an increase of $1.4 million in insurance expense primarily due to higher premiums in 2025 as compared to 2024; and

•several individually insignificant items.

The increase was partially offset by:

•contract costs of $6.7 million in 2024 related to operational performance,