Company: TVC
Filing Date: 2025-11-13
Form Type: 10-K
Source: 0001376986-25-000056
Chunk: 663

Company: Tennessee Valley Authority
Filing Date: 2025-11-13
Form: 10-K
Item: Item 1A
Chunk 663
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 cloud systems, to support a variety of business processes and activities and to store sensitive data.  Some of TVA’s information technology systems may be dependent upon cloud service providers.  These providers’ systems are susceptible to cybersecurity and data breaches and outages from fire, floods, power loss, telecommunications failures, security violations, and similar events.  Failure to prevent or mitigate data loss from system failures or outages could materially affect the results of operations, financial condition, and cash flows of TVA.

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The emergence of artificial intelligence technology could create challenges for TVA, and TVA may not be able to adopt the use of technology in step with private utilities.

TVA’s sensitive information may be subject to improper disclosure or harmful fabrication by artificial intelligence (“AI”) and machine learning technologies on systems external to TVA, leading to compromises in cybersecurity.  AI and machine learning technology may also be flawed, and data sets used in generative AI may be insufficient or contain biased, incorrect, or incomplete information.  Additionally, inconsistent application of AI regulations and guidance in the industry may make the intellectual property ownership and license rights to certain information unclear.  TVA could suffer reputational damage or face operational challenges because of any inconsistencies or flaws in the application of AI or machine learning technology or from the improper use of AI by employees or contractors.  TVA could also face costs in complying with any new regulations concerning AI.  The cost of implementing new AI regulations or the consequences of not complying with any future regulations could harm TVA’s financial condition.  Moreover, AI may be used to enhance malicious cyber attacks.  

TVA could lose its competitive edge if it fails to keep up with the changes in technology. 

TVA’s competitive position could be impacted if TVA is unable to deploy new technology in a cost-effective and competitive manner.  This process of enhancing or replacing TVA’s technology infrastructure involves significant development and implementation costs to keep pace with changing technologies and customer demand.  If TVA fails to successfully implement critical technology infrastructure, or if it does not provide the anticipated benefits or meet customer demands, such failure could negatively affect TVA’s business strategy as well as impact its results of operations, financial position, and cash flows.  Additionally, TVA may fail to fully capitalize on new technology, including AI, due to cybersecurity risk aversion or unique regulations applicable to TVA, leading to a loss in competitive edge or inability to efficiently solve future problems.

FINANCIAL, ECONOMIC, AND MARKET RISKS

Demand