Company: TVC
Filing Date: 2025-02-05
Form Type: 10-Q
Source: 0001376986-25-000011
Chunk: 296

Company: Tennessee Valley Authority
Filing Date: 2025-02-05
Form: 10-Q
Item: Part II, Item 5
Chunk 296
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 under the Financial Hedging Program ("FHP"), or for certain transactions with third parties that require TVA to post letters of credit. 

22

The following table provides additional information regarding TVA's funding available under the four long-term revolving credit facilities:Summary of Long-Term Credit FacilitiesAt December 31, 2024(in millions)Maturity DateFacility LimitLetters of Credit OutstandingCash BorrowingsAvailabilityMarch 2026$150 $38 $— $112 September 20261,000 68 — 932 March 20271,000 180 — 820 February 2028500 214 — 286 Total$2,650 $500 $— $2,150 TVA and the United States ("U.S.") Department of the Treasury ("U.S. Treasury"), pursuant to the TVA Act, have entered into a memorandum of understanding under which the U.S. Treasury provides TVA with a $150 million credit facility.  This credit facility was renewed for 2025 with a maturity date of September 30, 2025.  Access to this credit facility or other similar financing arrangements with the U.S. Treasury has been available to TVA since the 1960s.  TVA can borrow under the U.S. Treasury credit facility only if it cannot issue bonds, notes, or other evidences of indebtedness (collectively, "Bonds") in the market on reasonable terms, and TVA considers the U.S. Treasury credit facility a secondary source of liquidity.  The interest rate on any borrowing under this facility is based on the average rate on outstanding marketable obligations of the U.S. with maturities from date of issue of 12 months or less.  There were no outstanding borrowings under the facility at December 31, 2024.  The availability of this credit facility may be impacted by how the U.S. government addresses the possibility of approaching its debt limit.

13.  Risk Management Activities and Derivative Transactions 

TVA is exposed to various risks related to commodity prices, investment prices, interest rates, currency exchange rates, and inflation as well as counterparty credit and performance risks.  To help manage certain of these risks, TVA has historically entered into various derivative transactions, principally commodity option contracts, forward contracts, swaps, swaptions, futures, and options on futures.  Overview of Accounting TreatmentTVA recognizes certain of its derivative instruments as either assets or liabilities