Company: TVC
Filing Date: 2025-11-13
Form Type: 10-K
Source: 0001376986-25-000056
Chunk: 136

Company: Tennessee Valley Authority
Filing Date: 2025-11-13
Form: 10-K
Item: Item 8
Chunk 136
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)(in millions)Natural gas contract derivatives53562 million mmBtu$10 45321 million mmBtu$2 Commodity Derivatives under the FHP.  Currently, TVA is hedging exposure to the price of natural gas under the FHP.  There is no Value at Risk aggregate transaction limit under the current FHP structure, but the TVA Board reviews and authorizes the use of tolerances and measures annually.  TVA's FHP policy prohibits trading financial instruments under the FHP for speculative purposes.  At September 30, 2025, TVA's natural gas swap contracts under the FHP had remaining terms of up to four years.Commodity Derivatives under Financial Hedging Program(1)At September 3020252024Number of ContractsNotional AmountFair Value (MtM)(in millions)Number of ContractsNotional AmountFair Value (MtM)(in millions)Natural gas swap contracts295300 million mmBtu$(57)126230 million mmBtu$(161)Note(1)  Fair value amounts presented are based on the net commodity position with the counterparty.  Notional amounts disclosed represent the net value of contractual amounts.TVA defers all FHP unrealized gains (losses) as regulatory liabilities (assets) and records the realized gains or losses in Fuel expense and Purchased power expense to match the delivery period of the underlying commodity.  

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Offsetting of Derivative Assets and Liabilities    The amounts of TVA's derivative instruments as reported on the Consolidated Balance Sheets are shown in the table below:Derivative Assets and Liabilities(1)At September 30(in millions)20252024AssetsCommodity contract derivatives 16 7 Commodity derivatives under the FHP(2)8 — Total derivatives subject to master netting or similar arrangement$24 $7 LiabilitiesCurrency swaps$115 $116 Interest rate swaps(3)698 840 Commodity contract derivatives6 5 Commodity derivatives under the FHP(2)65 161 Total derivatives subject to master netting or similar arrangement$884 $1,122 Notes(1)  Offsetting amounts include counterparty netting of derivative contracts.  Except as discussed below, there were no other material offsetting amounts on TVA's Consolidated Balance Sheets at either September 30, 2025 or 2024.(2)  At September 30,