Company: EAI
Filing Date: 2025-02-18
Form Type: 10-K
Source: 0000065984-25-000012
Chunk: 964

Company: ENTERGY ARKANSAS, LLC
Filing Date: 2025-02-18
Form: 10-K
Item: Item 7
Chunk 964
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 increase of $3.9 million in bad debt expense;

•an increase of $3.2 million in storm damage provisions;

•an increase of $2.6 million in transmission costs allocated by MISO; and

•several individually insignificant items.

The increase was partially offset by a decrease of $13.3 million in power delivery expenses primarily due to lower vegetation maintenance costs.

Depreciation and amortization expenses increased primarily due to the recognition of $27.6 million in depreciation expense in 2024 for the 2022 base rate case relate back period, effective over six months beginning January 2024.  The recognition of depreciation expense for the relate back period was effective over the same period as collections from the relate back surcharge rider and results in no effect on net income.  Also contributing to the increase were additions to plant in service.  See Note 2 to the financial statements for discussion of the 2022 base rate case.

Other regulatory charges (credits) - net includes the reversal in third quarter 2023 of $21.9 million of regulatory liabilities to reflect the recognition of certain receipts by Entergy Texas under affiliated PPAs that have been resolved.  See Note 2 to the financial statements for discussion of the 2022 base rate case.

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 2024, including the Orange County Advanced Power Station project.

Interest expense increased primarily due to the issuance of $350 million of 5.80% Series mortgage bonds in August 2023 and the issuance of $350 million of 5.55% Series mortgage bonds in August 2024, partially offset by 

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

an increase in the allowance for borrowed funds used during construction due to higher construction work in progress in 2024, including the Orange County Advanced Power Station project.

The effective income tax rates were 18.3% for 2024 and 17.8% for 2023.  See Note 3 to the financial statements for a reconciliation of the federal statutory rate of 21% to the effective income tax rates and for additional discussion regarding income taxes.

2023 Compared to 2022

See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Results of Operations” in Item 7 of Entergy Texas’s Annual Report on Form 10-K for the year