Company: TVC
Filing Date: 2025-11-13
Form Type: 10-K
Source: 0001376986-25-000056
Chunk: 439

Company: Tennessee Valley Authority
Filing Date: 2025-11-13
Form: 10-K
Item: Item 7
Chunk 439
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  Revised flexibility agreements were made available to LPCs in August 2023 which permit projects to be located anywhere in TVA's service area, either connected to the LPC distribution system or TVA's transmission system, and make it easier for LPCs to partner in projects.  As of September 30, 2025, 148 LPCs had signed the Partnership Agreement with TVA, and 109 LPCs had signed a Power Supply Flexibility Agreement.

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In previous years, the TVA Board approved pandemic credits, which were effective in 2023.  These credits provided an annual 2.5 percent monthly base rate credit and applied to service provided to TVA's LPCs, their large commercial and industrial customers, and TVA directly served customers.  For the year ended September 30, 2023, pandemic credits totaled $225 million. The pandemic credits ended September 30, 2023.The number of LPCs by contract arrangement, the revenues derived from such arrangements for 2025, and the percentage those revenues comprised of TVA's total operating revenues for 2025, are summarized in the table below:TVA Local Power Company ContractsAt or for the year ended September 30, 2025Contract Arrangements(1)Number of LPCs Revenue from Sales of Electricity to LPCs(in millions)Percentage of Total Operating Revenues20-year termination notice148 $10,636 77.8 %5-year termination notice5 1,698 12.4 %Total153 $12,334 90.2 %Note(1)  Ordinarily, the LPCs and TVA have the same termination notice period; however, in a contract with one of the LPCs with a five-year termination notice, TVA has a 10-year termination notice (which becomes a five-year termination notice if TVA loses its discretionary wholesale rate-setting authority).  Certain LPCs have five-year termination notices or a shorter period if any act of Congress, court decision, or regulatory change requires or permits that election.                                                                                                                  TVA's two largest LPCs — Memphis Light, Gas and Water Division ("MLGW") and Nashville Electric Service ("NES") — have contracts with a five-year and a 20-year termination notice period, respectively.  Sales to MLGW and NES accounted for nine percent and eight percent, respectively, of TVA's total operating revenues in 2025, 2024, and 202