Company: TVC
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001376986-25-000029
Chunk: 419

Company: Tennessee Valley Authority
Filing Date: 2025-05-01
Form: 10-Q
Item: Part II, Item 5
Chunk 419
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  This change is primarily driven by an increase in TVA's revenue from sales of electricity in 2024, which is used as the basis for calculating tax equivalent expense.

Six Months Ended March 31, 2025, Compared to Six Months Ended March 31, 2024

Fuel expense decreased $52 million for the six months ended March 31, 2025, as compared to the same period of the prior year.  A decrease of $165 million was primarily due to the deferral of significant expenses that were the result of higher than expected coal and gas prices due to colder than average temperatures and less availability of nuclear generation compared to forecast.  These deferrals will be recognized in expense as collected in customer rates in subsequent quarters.  Additionally, fuel expense decreased $26 million due to less availability of nuclear generation as compared to the same period of the prior year.  Partially offsetting these decreases was an increase of $139 million due primarily to using higher cost coal and natural gas generation due to less availability of nuclear generation as compared to the same period of the prior year.

Purchased power expense increased $235 million for the six months ended March 31, 2025, as compared to the same period of the prior year.  This increase was primarily due to higher demand for energy with less availability of TVA nuclear generation, resulting in an increase of $332 million.  Partially offsetting this increase was a $93 million decrease in purchased power expense from lower purchased power market prices compared to the same period of the prior year.

Operating and maintenance expense increased $93 million for the six months ended March 31, 2025, as compared to the same period of the prior year.  This increase was primarily due to $104 million of increased payroll and benefit costs primarily due to severance costs associated with ETP efforts, labor escalation for cost of living increases, and additional headcount as compared to the prior year.  In addition, there was a $17 million increase in outage expense primarily due to the scope and timing of coal and natural gas outages during the six months ended March 31, 2025, as compared to the same period of the prior year and an increase in nuclear outage days.  Partially offsetting these increases was a $23 million decrease in expenditures related to project contract labor primarily due to higher power operations performance activities and other natural gas project work in the prior year.

Depreciation and amortization expense increased $68 million for the six months ended March 31