Company: TVC
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001376986-25-000029
Chunk: 350

Company: Tennessee Valley Authority
Filing Date: 2025-05-01
Form: 10-Q
Item: Part II, Item 2
Chunk 350
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 reductions to planned cost increases in 2026 and beyond to support future fleet investments needed to meet growing demand.  TVA's ETP is focused on improving financial health, enhancing asset performance, automating processes, optimizing third-party spend through supply chain, and making the workforce more efficient.  As part of these efforts, certain employees will be eligible for severance payments.  As of March 31, 2025, TVA had accrued $38 million related to estimated future severance payments.  The ETP is ongoing, and any potential future severances costs are uncertain at this time.

Optimum Energy Portfolio

Additional load growth for the foreseeable future is expected, and new capacity will be needed to support this load growth and replace retiring and expiring capacity.  In April of 2025, TVA released a request for proposals for up to 2,250 MW of new build energy resources for potential PPAs.  Energy resources that may participate in this RFP are utility-scale natural gas, battery energy storage systems ("BESS"), solar plus BESS, and solar generation that must demonstrate ability to be commercially operable by 2031.

Natural Gas-Fired Units.  As TVA continues to evaluate the impact of retiring its coal-fired fleet by 2035 and works to

accelerate the growth of renewables, it also continues to evaluate adding flexible lower carbon-emitting gas plants as a strategy

to maintain reliability.  Pre-commercial plant operations began on Johnsonville Aeroderivative CT Units 25-28 in the first quarter of 2025 and began on Units 21-24 and 29-30 in the second quarter of 2025. 

TVA is replacing generation for one unit at Cumberland Fossil Plant with a 1,450 MW combined cycle plant that is expected to be operational by the end of CY 2026.  As of March 31, 2025, TVA had spent $1.5 billion on this project.  See Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations — Key Initiatives and Challenges — Natural Gas-Fired Units in the Annual Report.

To operate the Cumberland Combined Cycle Plant, TVA has contracted for the transportation of gas from a gas pipeline that will need to be constructed. To construct the pipeline, the pipeline company, Tennessee Gas Pipeline Company, L.L.C. (“Tennessee Gas”), obtained permits from various state and federal agencies and a certificate of public convenience and necessity from the Federal