Company: EAI
Filing Date: 2025-02-18
Form Type: 10-K
Source: 0000065984-25-000012
Chunk: 150

Company: ENTERGY ARKANSAS, LLC
Filing Date: 2025-02-18
Form: 10-K
Item: Item 1A
Chunk 150
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 operating companies.  These technologies and their related business applications have developed rapidly in recent years and continue to develop.  Entergy cannot predict the rate at which or the extent to which these emerging technologies will be broadly adopted and successful as business models.  Changes in industry practice or advances in these technologies could reduce the demand for electricity to power data centers.  Additionally, these customers may experience business downturn, which may cause the loss of these customers or may weaken their financial condition.  Similarly, customers may reduce their investment in these new technologies or abandon them entirely.

Any of these situations may result in the early termination or non-renewal of these customers’ electric service agreements or renewal on terms less favorable to the Utility operating company.  Our electric service agreements with these customers include provisions for early termination payments in certain circumstances, but they do not fully protect against these risks.  In the event a customer does not renew its electric service agreement, the Utility operating companies are also subject to the risk that they may not be able to enter into services agreements with new customers or that the terms of any new agreements may be less favorable to the Utility operating companies.  While the assets constructed to serve these customers may otherwise be useful in the Utility operating companies’ business, there is a risk that the Utility operating companies may not be able to fully recover their investment in or a return on those assets, either through retail or wholesale rates.  The small number of such customers and scale of the investment required to support those customers exacerbates this risk.

The success of these Utility operating companies’ investments in new generation and transmission assets to support large-scale data centers depends on the successful completion of large capital projects to provide electricity to these data centers.  As discussed elsewhere in this report, the ability to complete large capital projects is dependent upon several factors, including, among others, the ability to obtain financing of such projects on satisfactory terms and conditions, secure regulatory permits, secure sufficient land for the siting of solar panels and power generation facilities, obtain and maintain MISO interconnection queue positions and otherwise obtain necessary interconnection or transmission service in MISO, and hire qualified labor, as well as levels of public support or opposition to these projects, and suppliers’ and contractors’ performance and ability to fulfill their obligations under contracts.  Successful completion of these projects may be further influenced by changes in law or regulation, such as environmental compliance requirements or MISO tariff rules and processes, direct and indirect 

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Table of ContentsPart I Item 1A, 1B, and 1