Company: EAI
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0000065984-25-000132
Chunk: 477

Company: ENTERGY ARKANSAS, LLC
Filing Date: 2025-10-31
Form: 10-Q
Item: Item 1
Chunk 477
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 provisions.

Taxes other than income taxes increased primarily due to increases in ad valorem taxes resulting from higher assessments and increases in local franchise taxes as a result of higher retail revenues in 2025 as compared to 2024.

Depreciation and amortization expenses decreased 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 resulted in no effect on net income.  See Note 2 to the financial statements in the Form 10-K for discussion of the 2022 base rate case.  The decrease was partially offset by additions to plant in service.

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 2025, including the Orange County Advanced Power Station project, the Legend Power Station project, and the Lone Star Power Station project.

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

Interest expense increased primarily due to the issuance of $500 million of 5.25% Series mortgage bonds in February 2025 and the issuance of $350 million of 5.55% Series mortgage bonds in August 2024, partially offset by an increase in the allowance for borrowed funds used during construction due to higher construction work in progress in 2025, including the Orange County Advanced Power Station project, the Legend Power Station project, and the Lone Star Power Station project.

Income Taxes

The effective income tax rates were 18.3% for the third quarter 2025 and 17.2% for the nine months ended September 30, 2025.  The differences in the effective income tax rates for the third quarter 2025 and the nine months ended September 30, 2025 versus the federal statutory rate of 21% were primarily due to book and tax differences related to the allowance for equity funds used during construction.

The effective income tax rates were 18.8% for the third quarter 2024 and 18.7% for the nine months ended September 30, 2024.  The differences in the effective income tax rates for the third quarter 2024 and the nine months ended September 30, 2024 versus the federal statutory rate of 21% were primarily