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A corporate agency of the United States created by an act of Congress
(State or other jurisdiction of incorporation or organization)
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62-0474417
(IRS Employer Identification No.)
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400 W. Summit Hill Drive
Knoxville, Tennessee
(Address of principal executive offices)
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37902
(Zip Code)
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Table of Contents
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GLOSSARY OF COMMON ACRONYMS
......................................................................................................................................
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FORWARD-LOOKING INFORMATION
.........................................................................................................................................
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GENERAL INFORMATION
............................................................................................................................................................
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ITEM 1. FINANCIAL STATEMENTS
.............................................................................................................................................
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Consolidated
Statements of Operations (unaudited)
............................................................................................................
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Consolidated Statements of Comprehensive Income (Loss) (unaudited).............................................................................
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Consolidated
Balance Sheets (unaudited)
............................................................................................................................
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Consolidated
Statements of Cash Flows (unaudited)
...........................................................................................................
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Consolidated
Statements of Changes in Proprietary Capital (unaudited)
.............................................................................
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Notes to Consolidated Financial Statements (unaudited)
.....................................................................................................
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Executive Overview
...............................................................................................................................................................
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Results of Operations
............................................................................................................................................................
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Liquidity and Capital Resources
............................................................................................................................................
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Key Initiatives and Challenges..............................................................................................................................................
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Environmental Matters..........................................................................................................................................................
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Legal Proceedings................................................................................................................................................................
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Off-Balance Sheet Arrangements.........................................................................................................................................
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Critical Accounting Policies and Estimates
...........................................................................................................................
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New Accounting Standards and Interpretations
....................................................................................................................
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Legislative and Regulatory Matters.......................................................................................................................................
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
..............................................................
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ITEM 4. CONTROLS AND PROCEDURES
..................................................................................................................................
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Disclosure Controls and Procedures
......................................................................................................................................
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Changes in Internal Control over Financial Reporting
............................................................................................................
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ITEM 1. LEGAL PROCEEDINGS
..................................................................................................................................................
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ITEM 1A. RISK FACTORS
...........................................................................................................................................................
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ITEM 6. EXHIBITS
.......................................................................................................................................................................
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SIGNATURES
...............................................................................................................................................................................
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EXHIBIT INDEX
............................................................................................................................................................................
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NDT
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Nuclear Decommissioning Trust
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NEPA
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National Environmental Policy Act
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NERC
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North American Electric Reliability Corporation
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NO
x
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Nitrogen oxide
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NPDES
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National Pollutant Discharge Elimination System
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NRC
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Nuclear Regulatory Commission
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OCI
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Other Comprehensive Income (Loss)
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PM
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Particulate matter
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QER
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Quadrennial Energy Review
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QTE
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Qualified technological equipment and software
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REIT
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Real Estate Investment Trust
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SACE
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Southern Alliance for Clean Energy
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SCCG
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Southaven Combined Cycle Generation LLC
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SCRs
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Selective catalytic reduction systems
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SEC
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Securities and Exchange Commission
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SERP
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Supplemental Executive Retirement Plan
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Seven States
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Seven States Power Corporation
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SHLLC
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Southaven Holdco LLC
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SMR
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Small modular reactor(s)
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SO
2
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Sulfur dioxide
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SSSL
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Seven States Southaven, LLC
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TCWN
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Tennessee Clean Water Network
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TDEC
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Tennessee Department of Environment & Conservation
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TOU
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Time-of-use
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TVARS
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Tennessee Valley Authority Retirement System
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TN Board
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Tennessee Board of Water Quality, Oil and Gas
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U.S. Treasury
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United States Department of the Treasury
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VIE
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Variable interest entity
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XBRL
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eXtensible Business Reporting Language
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•
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New or amended, or existing, laws, regulations, or administrative orders, including those related to environmental matters, and the costs of complying with these laws, regulations, and administrative orders;
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•
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The cost of complying with known, anticipated, and new emissions reduction requirements, some of which could render continued operation of many of TVA's aging coal-fired generation units not cost-effective and result in their removal from service, perhaps permanently;
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•
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Actions taken, or inaction, by the U.S. government relating to the national debt ceiling or automatic spending cuts in government programs;
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•
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Costs and liabilities that are not anticipated in TVA’s financial statements for third-party claims, natural resource damages, or fines or penalties associated with events such as the
Kingston Fossil Plant ("Kingston")
ash spill as well as for environmental clean-up activities;
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•
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Addition or loss of customers;
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•
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Significant changes in demand for electricity which may result from, among other things, economic downturns, increased energy efficiency and conservation, and improvements in distributed generation or other alternative generation technologies;
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•
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Significant delays, cost increases, or cost overruns associated with the construction of generation or transmission assets;
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•
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Changes in the timing or amount of pension and health care costs;
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•
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Increases in TVA's financial liabilities for decommissioning its nuclear facilities and retiring other assets;
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•
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Physical or cyber attacks on TVA's assets;
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•
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The outcome of legal and administrative proceedings;
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•
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The failure of TVA's generation, transmission, flood control, and related assets, including coal combustion residual facilities, to operate as anticipated, resulting in lost revenues, damages, and other costs that are not reflected in TVA’s financial statements or projections;
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•
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Differences between estimates of revenues and expenses and actual revenues earned and expenses incurred;
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•
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Weather conditions;
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•
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Catastrophic events such as fires, earthquakes, explosions, solar events, electromagnetic pulses, droughts, floods, hurricanes, tornadoes, pandemics, wars, national emergencies, terrorist activities, and other similar events, especially if these events occur in or near TVA's service area;
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•
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Events at a TVA facility, which, among other things, could result in loss of life, damage to the environment, damage to or loss of the facility, and damage to the property of others;
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•
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Events or changes involving transmission lines, dams, and other facilities not operated by TVA, including those that affect the reliability of the interstate transmission grid of which TVA's transmission system is a part and those that increase flows across TVA's transmission grid;
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•
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Disruption of fuel supplies, which may result from, among other things, weather conditions, production or transportation difficulties, labor challenges, or environmental laws or regulations affecting TVA's fuel suppliers or transporters;
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•
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Purchased power price volatility and disruption of purchased power supplies;
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•
|
Events which affect the supply of water for TVA's generation facilities;
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•
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Changes in TVA's determinations of the appropriate mix of generation assets;
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•
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TVA's organizational transformation efforts or cost reduction efforts not being fully successful;
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•
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Inability to obtain, or loss of, regulatory approval for the construction or operation of assets, including
Watts Bar Nuclear Plant ("Watts Bar")
Unit 2;
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•
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The requirement or decision to make additional contributions to TVA's pension or other post-retirement benefit plans or to TVA's Nuclear Decommissioning Trust or Asset Retirement Trust;
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•
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Limitations on TVA's ability to borrow money which may result from, among other things, TVA's approaching or substantially reaching the limit on bonds, notes, and other evidences of indebtedness specified in the Tennessee Valley Authority Act of 1933, as amended;
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•
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An increase in TVA's cost of capital which may result from, among other things, changes in the market for TVA's debt securities, changes in the credit rating of TVA or the U.S. government, and an increased reliance by TVA on alternative financing arrangements as TVA approaches its debt ceiling;
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•
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Changes in the economy and volatility in financial markets;
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•
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Changes in technology;
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•
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Reliability and creditworthiness of counterparties;
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•
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Changes in the market price of commodities such as coal, uranium, natural gas, fuel oil, crude oil, construction materials, reagents, electricity, and emission allowances;
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•
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Changes in the market price of equity securities, debt securities, and other investments;
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•
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Changes in interest rates, currency exchange rates, and inflation rates;
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•
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Ineffectiveness of TVA's disclosure controls and procedures or its internal control over financial reporting;
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•
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Inability to eliminate identified deficiencies in TVA's systems, standards, controls, or corporate culture;
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•
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Inability to attract or retain a skilled workforce;
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•
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Events at a nuclear facility, whether or not operated by or licensed to TVA, which, among other things, could lead to increased regulation or restriction on the construction, ownership, operation, and decommissioning of nuclear facilities or on the storage of spent fuel, obligate TVA to pay retrospective insurance premiums, reduce the availability and affordability of insurance, increase the costs of operating TVA's existing nuclear units, negatively affect the cost and schedule for completing Watts Bar Unit 2 and preserving Bellefonte Nuclear Plant Unit 1 for possible completion, and cause TVA to forego future construction at these or other facilities;
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•
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Loss of quorum of the TVA Board of Directors; and
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•
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Other unforeseeable events.
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Three Months Ended June 30
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Nine Months Ended June 30
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||||||||||||
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2015
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2014
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2015
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2014
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||||||||
Operating revenues
|
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|
|
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||||||||
Revenue from sales of electricity
|
$
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2,522
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$
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2,618
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$
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7,722
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$
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7,869
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Other revenue
|
36
|
|
|
33
|
|
|
110
|
|
|
102
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||||
Total operating revenues
|
2,558
|
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|
2,651
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|
|
7,832
|
|
|
7,971
|
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||||
Operating expenses
|
|
|
|
|
|
|
|
|
|
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||||
Fuel
|
608
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|
698
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|
|
1,744
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|
|
1,904
|
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||||
Purchased power
|
244
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|
|
279
|
|
|
736
|
|
|
843
|
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||||
Operating and maintenance
|
738
|
|
|
880
|
|
|
2,083
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|
|
2,480
|
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||||
Depreciation and amortization
|
534
|
|
|
463
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|
|
1,440
|
|
|
1,357
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||||
Tax equivalents
|
128
|
|
|
133
|
|
|
383
|
|
|
395
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|
||||
Total operating expenses
|
2,252
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|
2,453
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|
|
6,386
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|
|
6,979
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||||
Operating income
|
306
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|
|
198
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1,446
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|
992
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||||
Other income (expense), net
|
8
|
|
|
10
|
|
|
25
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|
|
37
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||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
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||||
Interest expense
|
337
|
|
|
334
|
|
|
1,020
|
|
|
1,009
|
|
||||
Allowance for funds used during construction
|
(55
|
)
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|
(45
|
)
|
|
(158
|
)
|
|
(127
|
)
|
||||
Net interest expense
|
282
|
|
|
289
|
|
|
862
|
|
|
882
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||||
Net income (loss)
|
$
|
32
|
|
|
$
|
(81
|
)
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|
$
|
609
|
|
|
$
|
147
|
|
The accompanying notes are an integral part of these consolidated financial statements.
|
|
Three Months Ended June 30
|
|
Nine Months Ended June 30
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
32
|
|
|
$
|
(81
|
)
|
|
$
|
609
|
|
|
$
|
147
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
||||||||
Net unrealized gain (loss) on cash flow hedges
|
62
|
|
|
1
|
|
|
(12
|
)
|
|
23
|
|
||||
Reclassification to earnings from cash flow hedges
|
(53
|
)
|
|
(26
|
)
|
|
31
|
|
|
(55
|
)
|
||||
Total other comprehensive income (loss)
|
$
|
9
|
|
|
$
|
(25
|
)
|
|
$
|
19
|
|
|
$
|
(32
|
)
|
Total comprehensive income (loss)
|
$
|
41
|
|
|
$
|
(106
|
)
|
|
$
|
628
|
|
|
$
|
115
|
|
The accompanying notes are an integral part of these consolidated financial statements.
|
ASSETS
|
|||||||
|
June 30, 2015
|
|
September 30, 2014
|
||||
Current assets
|
(Unaudited)
|
|
|
||||
Cash and cash equivalents
|
$
|
500
|
|
|
$
|
500
|
|
Restricted cash and investments
|
—
|
|
|
19
|
|
||
Accounts receivable, net
|
1,575
|
|
|
1,676
|
|
||
Inventories, net
|
1,126
|
|
|
1,056
|
|
||
Regulatory assets
|
549
|
|
|
481
|
|
||
Other current assets
|
81
|
|
|
56
|
|
||
Total current assets
|
3,831
|
|
|
3,788
|
|
||
|
|
|
|
||||
Property, plant, and equipment
|
|
|
|
|
|
||
Completed plant
|
49,782
|
|
|
47,564
|
|
||
Less accumulated depreciation
|
(25,755
|
)
|
|
(24,589
|
)
|
||
Net completed plant
|
24,027
|
|
|
22,975
|
|
||
Construction in progress
|
6,640
|
|
|
5,951
|
|
||
Nuclear fuel
|
1,329
|
|
|
1,322
|
|
||
Capital leases
|
96
|
|
|
102
|
|
||
Total property, plant, and equipment, net
|
32,092
|
|
|
30,350
|
|
||
|
|
|
|
||||
Investment funds
|
2,079
|
|
|
1,981
|
|
||
|
|
|
|
||||
Regulatory and other long-term assets
|
|
|
|
|
|
||
Regulatory assets
|
8,787
|
|
|
8,994
|
|
||
Other long-term assets
|
531
|
|
|
483
|
|
||
Total regulatory and other long-term assets
|
9,318
|
|
|
9,477
|
|
||
|
|
|
|
||||
Total assets
|
$
|
47,320
|
|
|
$
|
45,596
|
|
The accompanying notes are an integral part of these consolidated financial statements.
|
LIABILITIES AND PROPRIETARY CAPITAL
|
|||||||
|
June 30, 2015
|
|
September 30, 2014
|
||||
Current liabilities
|
(Unaudited)
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
1,956
|
|
|
$
|
2,050
|
|
Accrued interest
|
315
|
|
|
380
|
|
||
Current portion of leaseback obligations
|
79
|
|
|
75
|
|
||
Current portion of energy prepayment obligations
|
100
|
|
|
100
|
|
||
Regulatory liabilities
|
168
|
|
|
184
|
|
||
Short-term debt, net
|
2,582
|
|
|
596
|
|
||
Current maturities of power bonds
|
32
|
|
|
1,032
|
|
||
Current maturities of long-term debt of variable interest entities
|
33
|
|
|
32
|
|
||
Total current liabilities
|
5,265
|
|
|
4,449
|
|
||
|
|
|
|
||||
Other liabilities
|
|
|
|
||||
Post-retirement and post-employment benefit obligations
|
5,852
|
|
|
5,839
|
|
||
Asset retirement obligations
|
3,676
|
|
|
3,089
|
|
||
Other long-term liabilities
|
2,019
|
|
|
1,962
|
|
||
Leaseback obligations
|
538
|
|
|
616
|
|
||
Energy prepayment obligations
|
235
|
|
|
310
|
|
||
Regulatory liabilities
|
1
|
|
|
—
|
|
||
Total other liabilities
|
12,321
|
|
|
11,816
|
|
||
|
|
|
|
||||
Long-term debt, net
|
|
|
|
||||
Long-term power bonds, net
|
21,744
|
|
|
21,948
|
|
||
Long-term debt of variable interest entities
|
1,263
|
|
|
1,279
|
|
||
Total long-term debt, net
|
23,007
|
|
|
23,227
|
|
||
|
|
|
|
||||
Total liabilities
|
40,593
|
|
|
39,492
|
|
||
|
|
|
|
||||
Proprietary capital
|
|
|
|
||||
Power program appropriation investment
|
258
|
|
|
258
|
|
||
Power program retained earnings
|
5,852
|
|
|
5,240
|
|
||
Total power program proprietary capital
|
6,110
|
|
|
5,498
|
|
||
Nonpower programs appropriation investment, net
|
593
|
|
|
601
|
|
||
Accumulated other comprehensive income (loss)
|
24
|
|
|
5
|
|
||
Total proprietary capital
|
6,727
|
|
|
6,104
|
|
||
|
|
|
|
||||
Total liabilities and proprietary capital
|
$
|
47,320
|
|
|
$
|
45,596
|
|
The accompanying notes are an integral part of these consolidated financial statements.
|
|
2015
|
|
2014
|
||||
Cash flows from operating activities
|
|
|
|
||||
Net income (loss)
|
$
|
609
|
|
|
$
|
147
|
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities
|
|
|
|
|
|
||
Depreciation and amortization (including amortization of debt issuance costs and premiums/discounts)
|
1,475
|
|
|
1,391
|
|
||
Amortization of nuclear fuel cost
|
206
|
|
|
205
|
|
||
Non-cash retirement benefit expense
|
249
|
|
|
429
|
|
||
Prepayment credits applied to revenue
|
(75
|
)
|
|
(75
|
)
|
||
Fuel cost adjustment deferral
|
(6
|
)
|
|
(91
|
)
|
||
Fuel cost tax equivalents
|
(17
|
)
|
|
1
|
|
||
Changes in current assets and liabilities
|
|
|
|
|
|
||
Accounts receivable, net
|
118
|
|
|
15
|
|
||
Inventories and other, net
|
(117
|
)
|
|
33
|
|
||
Accounts payable and accrued liabilities
|
(208
|
)
|
|
22
|
|
||
Accrued interest
|
(65
|
)
|
|
(66
|
)
|
||
Regulatory assets costs
|
(18
|
)
|
|
(49
|
)
|
||
Pension contributions
|
(144
|
)
|
|
(132
|
)
|
||
Insurance recoveries
|
50
|
|
|
175
|
|
||
Other, net
|
(41
|
)
|
|
(18
|
)
|
||
Net cash provided by operating activities
|
2,016
|
|
|
1,987
|
|
||
Cash flows from investing activities
|
|
|
|
|
|
||
Construction expenditures
|
(2,064
|
)
|
|
(1,694
|
)
|
||
Combined cycle plant acquisition
|
(342
|
)
|
|
—
|
|
||
Nuclear fuel expenditures
|
(252
|
)
|
|
(272
|
)
|
||
Purchases of investments
|
(1
|
)
|
|
—
|
|
||
Loans and other receivables
|
|
|
|
|
|
||
Advances
|
(11
|
)
|
|
(3
|
)
|
||
Repayments
|
7
|
|
|
5
|
|
||
Other, net
|
(27
|
)
|
|
3
|
|
||
Net cash used in investing activities
|
(2,690
|
)
|
|
(1,961
|
)
|
||
Cash flows from financing activities
|
|
|
|
|
|
||
Long-term debt
|
|
|
|
|
|
||
Redemptions and repurchases of power bonds
|
(1,180
|
)
|
|
(363
|
)
|
||
Redemptions of variable interest entities
|
(15
|
)
|
|
(15
|
)
|
||
Short-term debt issues (redemptions), net
|
1,986
|
|
|
(674
|
)
|
||
Payments on leases and leasebacks
|
(77
|
)
|
|
(70
|
)
|
||
Payments to U.S. Treasury
|
(5
|
)
|
|
(10
|
)
|
||
Other, net
|
(35
|
)
|
|
9
|
|
||
Net cash provided by (used in) financing activities
|
674
|
|
|
(1,123
|
)
|
||
Net change in cash and cash equivalents
|
—
|
|
|
(1,097
|
)
|
||
Cash and cash equivalents at beginning of period
|
500
|
|
|
1,602
|
|
||
Cash and cash equivalents at end of period
|
$
|
500
|
|
|
$
|
505
|
|
|
|
|
|
||||
Supplemental Disclosures
|
|
|
|
||||
Significant non-cash transactions
|
|
|
|
||||
Accrued capital and nuclear fuel expenditures
|
$
|
414
|
|
|
$
|
242
|
|
The accompanying notes are an integral part of these consolidated financial statements.
|
|
Power Program Appropriation Investment
|
|
Power Program Retained Earnings
|
|
Nonpower Programs Appropriation Investment, Net
|
|
Accumulated
Other
Comprehensive
Income (Loss)
from
Net Gains (Losses) on Cash Flow Hedges
|
|
Total
|
||||||||||
Balance at March 31, 2014 (unaudited)
|
$
|
263
|
|
|
$
|
4,997
|
|
|
$
|
605
|
|
|
$
|
(4
|
)
|
|
$
|
5,861
|
|
Net income (loss)
|
—
|
|
|
(79
|
)
|
|
(2
|
)
|
|
—
|
|
|
(81
|
)
|
|||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|
(25
|
)
|
|||||
Return on power program appropriation investment
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||
Return of power program appropriation investment
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||||
Balance at June 30, 2014 (unaudited)
|
$
|
261
|
|
|
$
|
4,917
|
|
|
$
|
603
|
|
|
$
|
(29
|
)
|
|
$
|
5,752
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at March 31, 2015 (unaudited)
|
$
|
258
|
|
|
$
|
5,819
|
|
|
$
|
595
|
|
|
$
|
15
|
|
|
$
|
6,687
|
|
Net income (loss)
|
—
|
|
|
34
|
|
|
(2
|
)
|
|
—
|
|
|
32
|
|
|||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
9
|
|
|||||
Return on power program appropriation investment
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||
Balance at June 30, 2015 (unaudited)
|
$
|
258
|
|
|
$
|
5,852
|
|
|
$
|
593
|
|
|
$
|
24
|
|
|
$
|
6,727
|
|
The accompanying notes are an integral part of these consolidated financial statements.
|
|
Power Program Appropriation Investment
|
|
Power Program Retained Earnings
|
|
Nonpower Programs Appropriation Investment, Net
|
|
Accumulated
Other
Comprehensive
Income (Loss)
from
Net Gains (Losses) on Cash Flow Hedges
|
|
Total
|
||||||||||
Balance at September 30, 2013
|
$
|
268
|
|
|
$
|
4,767
|
|
|
$
|
609
|
|
|
$
|
3
|
|
|
$
|
5,647
|
|
Net income (loss)
|
—
|
|
|
153
|
|
|
(6
|
)
|
|
—
|
|
|
147
|
|
|||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(32
|
)
|
|
(32
|
)
|
|||||
Return on power program appropriation investment
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||||
Return of power program appropriation investment
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|||||
Balance at June 30, 2014 (unaudited)
|
$
|
261
|
|
|
$
|
4,917
|
|
|
$
|
603
|
|
|
$
|
(29
|
)
|
|
$
|
5,752
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at September 30, 2014
|
$
|
258
|
|
|
$
|
5,240
|
|
|
$
|
601
|
|
|
$
|
5
|
|
|
$
|
6,104
|
|
Net income (loss)
|
—
|
|
|
617
|
|
|
(8
|
)
|
|
—
|
|
|
609
|
|
|||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
19
|
|
|||||
Return on power program appropriation investment
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|||||
Balance at June 30, 2015 (unaudited)
|
$
|
258
|
|
|
$
|
5,852
|
|
|
$
|
593
|
|
|
$
|
24
|
|
|
$
|
6,727
|
|
The accompanying notes are an integral part of these consolidated financial statements.
|
Note No.
|
Page No.
|
||
|
|||
|
|||
|
Restructuring
|
||
|
|||
|
|||
|
Acquisition
|
||
7
|
|
||
8
|
|
||
9
|
|
Variable Interest Entities
|
|
10
|
|
||
11
|
|
||
12
|
|
||
13
|
|
Debt
and Other Obligations
|
|
14
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
15
|
|
||
16
|
|
||
17
|
|
||
18
|
|
||
19
|
|
Contingencies and
Legal Proceedings
|
Severance Cost Liability Activity
|
|||||||||||||||
|
Three Months Ended June 30
|
|
Nine Months Ended June 30
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Severance cost liability at beginning of period
|
$
|
1
|
|
|
$
|
32
|
|
|
$
|
45
|
|
|
$
|
—
|
|
Liabilities incurred during the period
|
7
|
|
|
21
|
|
|
7
|
|
|
56
|
|
||||
Actual costs paid during the period
|
(1
|
)
|
|
(7
|
)
|
|
(44
|
)
|
|
(10
|
)
|
||||
Adjustments to estimate during the period
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
Severance cost liability at end of period
|
$
|
7
|
|
|
$
|
46
|
|
|
$
|
7
|
|
|
$
|
46
|
|
Accounts Receivable, Net
|
|||||||
|
At June 30, 2015
|
|
At September 30, 2014
|
||||
Power receivables
|
$
|
1,451
|
|
|
$
|
1,576
|
|
Other receivables
|
125
|
|
|
101
|
|
||
Allowance for uncollectible accounts
|
(1
|
)
|
|
(1
|
)
|
||
Accounts receivable, net
|
$
|
1,575
|
|
|
$
|
1,676
|
|
Inventories, Net
|
|||||||
|
At June 30, 2015
|
|
At September 30, 2014
|
||||
Fuel inventory
|
$
|
513
|
|
|
$
|
473
|
|
Materials and supplies inventory
|
648
|
|
|
616
|
|
||
Emission allowance inventory, net
|
13
|
|
|
13
|
|
||
Allowance for inventory obsolescence
|
(48
|
)
|
|
(46
|
)
|
||
Inventories, net
|
$
|
1,126
|
|
|
$
|
1,056
|
|
Other Long-Term Assets
|
|||||||
|
At June 30, 2015
|
|
At September 30, 2014
|
||||
EnergyRight
®
receivables
|
$
|
123
|
|
|
$
|
123
|
|
Unamortized debt issue cost of power bonds and variable interest entities
|
75
|
|
|
68
|
|
||
Loans and other long-term receivables, net
|
108
|
|
|
87
|
|
||
Prepaid capacity payments
|
53
|
|
|
58
|
|
||
Restricted cash
|
—
|
|
|
64
|
|
||
Currency swap asset, net
|
61
|
|
|
—
|
|
||
Commodity contract derivative assets
|
1
|
|
|
—
|
|
||
Other
|
110
|
|
|
83
|
|
||
Other long-term assets
|
$
|
531
|
|
|
$
|
483
|
|
Regulatory Assets and Liabilities
|
|||||||
|
At June 30, 2015
|
|
At September 30, 2014
|
||||
Current regulatory assets
|
|
|
|
||||
Deferred nuclear generating units
|
$
|
236
|
|
|
$
|
237
|
|
Unrealized losses on commodity derivatives
|
182
|
|
|
134
|
|
||
Environmental agreements
|
70
|
|
|
54
|
|
||
Environmental cleanup costs - Kingston ash spill
|
45
|
|
|
47
|
|
||
Fuel cost adjustment receivable
|
14
|
|
|
9
|
|
||
Other current regulatory assets
|
2
|
|
|
—
|
|
||
Total current regulatory assets
|
549
|
|
|
481
|
|
||
|
|
|
|
||||
Non-current regulatory assets
|
|
|
|
|
|
||
Deferred pension costs and other post-retirement benefits costs
|
4,087
|
|
|
4,297
|
|
||
Deferred pension costs due to actions of regulator
|
171
|
|
|
—
|
|
||
Unrealized losses on interest rate derivatives
|
1,028
|
|
|
957
|
|
||
Nuclear decommissioning costs
|
892
|
|
|
931
|
|
||
Environmental cleanup costs - Kingston ash spill
|
362
|
|
|
421
|
|
||
Non-nuclear decommissioning costs
|
720
|
|
|
645
|
|
||
Deferred nuclear generating units
|
1,097
|
|
|
1,255
|
|
||
Environmental agreements
|
63
|
|
|
108
|
|
||
Unrealized losses on commodity derivatives
|
81
|
|
|
72
|
|
||
Other non-current regulatory assets
|
286
|
|
|
308
|
|
||
Total non-current regulatory assets
|
8,787
|
|
|
8,994
|
|
||
Total regulatory assets
|
$
|
9,336
|
|
|
$
|
9,475
|
|
|
|
|
|
||||
Current regulatory liabilities
|
|
|
|
|
|
||
Fuel cost adjustment tax equivalents
|
$
|
165
|
|
|
$
|
182
|
|
Unrealized gains on commodity derivatives
|
3
|
|
|
2
|
|
||
Total current regulatory liabilities
|
168
|
|
|
184
|
|
||
|
|
|
|
||||
Non-current regulatory liabilities
|
|
|
|
|
|
||
Unrealized gains on commodity derivatives
|
1
|
|
|
—
|
|
||
Total non-current regulatory liabilities
|
1
|
|
|
—
|
|
||
Total regulatory liabilities
|
$
|
169
|
|
|
$
|
184
|
|
Summary of Impact of VIEs on Consolidated Balance Sheets
|
|||||||
|
At June 30, 2015
|
|
At September 30, 2014
|
||||
Current liabilities of VIE
|
|
|
|
|
|||
Accrued interest of VIE
|
$
|
26
|
|
|
$
|
12
|
|
Current portion of membership interests of VIE subject to mandatory redemption
|
2
|
|
|
2
|
|
||
Current maturities of long-term debt of VIE
|
33
|
|
|
32
|
|
||
Total current liabilities of VIE
|
61
|
|
|
46
|
|
||
Other liabilities of VIE
|
|
|
|
||||
Membership interests of VIE subject to mandatory redemption
|
36
|
|
|
37
|
|
||
Long-term debt of VIE, net
|
|
|
|
||||
Long-term debt of VIE
|
1,263
|
|
|
1,279
|
|
||
Total liabilities of VIE
|
$
|
1,360
|
|
|
$
|
1,362
|
|
Other Long-Term Liabilities
|
|||||||
|
At June 30, 2015
|
|
At September 30, 2014
|
||||
Interest rate swap liabilities
|
$
|
1,419
|
|
|
$
|
1,348
|
|
Environmental Agreements liability
|
63
|
|
|
108
|
|
||
EnergyRight
®
financing obligation
|
149
|
|
|
152
|
|
||
Membership interests of VIE subject to mandatory redemption
|
36
|
|
|
37
|
|
||
Commodity contract derivative liabilities
|
29
|
|
|
17
|
|
||
Currency swap liabilities
|
23
|
|
|
15
|
|
||
Commodity swap derivative liabilities
|
11
|
|
|
14
|
|
||
Other
|
289
|
|
|
271
|
|
||
Total other long-term liabilities
|
$
|
2,019
|
|
|
$
|
1,962
|
|
Debt Outstanding
|
|||||||
|
At June 30, 2015
|
|
At September 30, 2014
|
||||
Short-term debt
|
|
|
|
||||
Short-term debt, net
|
$
|
2,582
|
|
|
$
|
596
|
|
Current maturities of long-term debt of variable interest entities
|
33
|
|
|
32
|
|
||
Current maturities of power bonds
|
32
|
|
|
1,032
|
|
||
Total current debt outstanding, net
|
2,647
|
|
|
1,660
|
|
||
Long-term debt
|
|
|
|
|
|
||
Long-term debt of variable interest entities
|
1,263
|
|
|
1,279
|
|
||
Long-term power bonds
(1)
|
21,827
|
|
|
22,037
|
|
||
Unamortized discounts, premiums, and other
|
(83
|
)
|
|
(89
|
)
|
||
Total long-term debt, net
|
23,007
|
|
|
23,227
|
|
||
Total outstanding debt
|
$
|
25,654
|
|
|
$
|
24,887
|
|
Debt Securities Activity
|
|||||||||
|
|
Date
|
|
Amount
|
|
Interest Rate
|
|||
|
|
|
|
|
|
|
|||
Redemptions/Maturities
|
|
|
|
|
|
|
|||
electronotes
®
|
|
First Quarter 2015
|
|
$
|
1
|
|
|
2.65
|
%
|
electronotes
®
|
|
Second Quarter 2015
|
|
42
|
|
|
4.20
|
%
|
|
electronotes
®
|
|
Third Quarter 2015
|
|
19
|
|
|
4.05
|
%
|
|
2009 Series A
|
|
November 2014
|
|
2
|
|
|
2.25
|
%
|
|
2009 Series B
|
|
December 2014
|
|
1
|
|
|
3.77
|
%
|
|
1999 Series A
|
|
May 2015
|
|
38
|
|
|
3.96
|
%
|
|
2009 Series A
|
|
May 2015
|
|
1
|
|
|
2.25
|
%
|
|
1998 Series D
|
|
June 2015
|
|
50
|
|
|
3.83
|
%
|
|
2009 Series B
|
|
June 2015
|
|
26
|
|
|
3.77
|
%
|
|
2005 Series B
|
|
June 2015
|
|
1,000
|
|
|
4.38
|
%
|
|
Total redemptions/maturities of power bonds
|
|
|
|
1,180
|
|
|
|
|
|
Variable interest entities
|
|
Second Quarter 2015
|
|
15
|
|
|
4.29
|
%
|
|
Total redemptions/maturities of debt
|
|
|
|
$
|
1,195
|
|
|
|
|
Summary of Long-Term Credit Facilities
At June 30, 2015
(in billions)
|
|||||||||||||||
Maturity Date
|
Facility Limit
|
|
Letters of Credit Outstanding
|
|
Cash Borrowings
|
|
Availability
|
||||||||
December 2017
|
$
|
1.0
|
|
|
$
|
0.3
|
|
|
$
|
—
|
|
|
$
|
0.7
|
|
April 2018
|
0.5
|
|
|
0.5
|
|
|
—
|
|
|
—
|
|
||||
June 2020
|
1.0
|
|
|
0.3
|
|
|
—
|
|
|
0.7
|
|
||||
Total
|
$
|
2.5
|
|
|
$
|
1.1
|
|
|
$
|
—
|
|
|
$
|
1.4
|
|
Summary of Derivative Instruments That Receive Hedge Accounting Treatment (part 1)
Amount of Mark-to-Market Gain (Loss) Recognized in OCI
|
|||||||||||||||||||||
|
|
|
|
|
|
Three Months Ended
June 30
|
|
Nine Months Ended
June 30
|
|
||||||||||||
Derivatives in Cash Flow Hedging Relationship
|
|
Objective of Hedge Transaction
|
|
Accounting for Derivative
Hedging Instrument
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||
Currency swaps
|
|
To protect against changes in cash flows caused by changes in foreign currency exchange rates (exchange rate risk)
|
|
Unrealized gains and losses are recorded in AOCI and reclassified to interest expense to the extent they are offset by gains and losses on the hedged transaction
|
|
$
|
62
|
|
|
$
|
1
|
|
|
$
|
(12
|
)
|
|
$
|
23
|
|
|
Summary of Derivative Instruments That Do Not Receive Hedge Accounting Treatment
Amount of Gain (Loss) Recognized in Income on Derivatives
|
|||||||||||||||||||||
|
|
|
|
|
|
Three Months Ended
June 30
(
1)
|
|
Nine Months Ended
June 30
(1)
|
|
||||||||||||
Derivative Type
|
|
Objective of Derivative
|
|
Accounting for Derivative Instrument
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||
Interest rate swaps
|
|
To fix short-term debt variable rate to a fixed rate (interest rate risk)
|
|
Mark-to-market gains and losses are recorded as regulatory assets or liabilities until settlement, at which time the gains/losses are recognized in gain/loss on derivative contracts.
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Commodity contract derivatives
|
|
To protect against fluctuations in market prices of purchased coal or natural gas (price risk)
|
|
Mark-to-market gains and losses are recorded as regulatory assets or liabilities. Realized gains and losses due to contract settlements are recognized in fuel expense as incurred.
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Commodity derivatives
under financial trading program ("FTP")
|
|
To protect against fluctuations in market prices of purchased commodities (price risk)
|
|
Mark-to-market gains and losses are recorded as regulatory assets or liabilities. Realized gains and losses are recognized in fuel expense or purchased power expense when the related commodity is used in production.
|
|
(30
|
)
|
|
(6
|
)
|
|
(69
|
)
|
|
(29
|
)
|
|
Fair Values of TVA Derivatives
|
||||||||||||
|
|
At June 30, 2015
|
|
At September 30, 2014
|
||||||||
Derivatives that Receive Hedge Accounting Treatment
|
|
Balance
|
|
Balance Sheet Presentation
|
|
Balance
|
|
Balance Sheet Presentation
|
||||
Currency swaps
|
|
|
|
|
|
|
|
|
||||
£200 million Sterling
|
|
$
|
(23
|
)
|
|
Other long-term liabilities
|
|
$
|
(15
|
)
|
|
Other long-term liabilities
|
£250 million Sterling
|
|
49
|
|
|
Other long-term assets
|
|
56
|
|
|
Other long-term assets
|
||
£150 million Sterling
|
|
12
|
|
|
Other long-term assets
|
|
8
|
|
|
Other long-term assets
|
||
|
|
|
|
|
|
|
|
|
||||
|
|
At June 30, 2015
|
|
At September 30, 2014
|
||||||||
Derivatives that Do Not Receive Hedge Accounting Treatment
|
|
Balance
|
|
Balance Sheet Presentation
|
|
Balance
|
|
Balance Sheet Presentation
|
||||
Interest rate swaps
|
|
|
|
|
|
|
|
|
||||
$1.0 billion notional
|
|
(1,034
|
)
|
|
Other long-term liabilities
|
|
(987
|
)
|
|
Other long-term liabilities
|
||
$476 million notional
|
|
(373
|
)
|
|
Other long-term liabilities
|
|
(349
|
)
|
|
Other long-term liabilities
|
||
$42 million notional
|
|
(12
|
)
|
|
Other long-term liabilities
|
|
(12
|
)
|
|
Other long-term liabilities
|
||
Commodity contract derivatives
|
|
(125
|
)
|
|
Other current assets $2; Other long-term assets $1; Other long-term liabilities $(29); Accounts payable and accrued liabilities $(99)
|
|
(96
|
)
|
|
Other current assets $1; Other long-term liabilities $(17); Accounts payable and accrued liabilities $(80)
|
||
FTP
|
|
|
|
|
|
|
|
|
||||
Derivatives under FTP
(1)
|
|
(125
|
)
|
|
Other current assets $(91); Other long-term liabilities $(11); Accounts payable and accrued liabilities $(23)
|
|
(103
|
)
|
|
Other current assets $(69); Other long-term liabilities $(14); Accounts payable and accrued liabilities $(20)
|
Currency Swaps Outstanding
At June 30, 2015
|
||||||
Effective Date of Currency Swap Contract
|
|
Associated TVA Bond Issues Currency Exposure
|
|
Expiration Date of Swap
|
|
Overall Effective
Cost to TVA
|
1999
|
|
£200 million
|
|
2021
|
|
5.81%
|
2001
|
|
£250 million
|
|
2032
|
|
6.59%
|
2003
|
|
£150 million
|
|
2043
|
|
4.96%
|
Commodity Contract Derivatives
|
|||||||||||||||
|
At June 30, 2015
|
|
At September 30, 2014
|
||||||||||||
|
Number of
Contracts
|
|
Notional Amount
|
|
Fair Value (MtM)
|
|
Number of Contracts
|
|
Notional Amount
|
|
Fair Value
(
MtM
)
|
||||
Coal contract derivatives
|
13
|
|
22 million tons
|
|
$
|
(128
|
)
|
|
24
|
|
31 million tons
|
|
$
|
(86
|
)
|
Natural gas contract derivatives
|
36
|
|
146 million mmBtu
|
|
$
|
3
|
|
|
46
|
|
62 million mmBtu
|
|
$
|
(10
|
)
|
Derivatives Under Financial Trading Program
|
|||||||||||||
|
At June 30, 2015
|
|
At September 30, 2014
|
||||||||||
|
Notional Amount
|
|
Fair Value (MtM)
(in millions)
|
|
Notional Amount
|
|
Fair Value (MtM)
(in millions)
|
||||||
Natural gas (in mmBtu)
|
|
|
|
|
|
|
|
||||||
Swap contracts
|
63,835,000
|
|
|
$
|
(125
|
)
|
|
102,227,500
|
|
|
$
|
(103
|
)
|
Financial Trading Program Realized Gains (Losses)
|
|||||||||||||||||
|
|
For the Three Months Ended
June 30
|
|
For the Nine Months Ended
June 30
|
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||
Decrease (increase) in fuel expense
|
|
|
|
|
|
|
|
|
|
||||||||
Natural gas
|
|
$
|
(24
|
)
|
|
$
|
(5
|
)
|
|
$
|
(56
|
)
|
|
$
|
(23
|
)
|
|
Fuel oil/crude oil
|
|
—
|
|
|
—
|
|
|
1
|
|
|
2
|
|
|
Financial Trading Program Realized Gains (Losses)
|
|||||||||||||||||
|
|
For the Three Months Ended
June 30 |
|
For the Nine Months Ended
June 30 |
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||
Decrease (increase) in purchased power expense
|
|
|
|
|
|
|
|
|
|
||||||||
Natural gas
|
|
$
|
(6
|
)
|
|
$
|
(1
|
)
|
|
$
|
(14
|
)
|
|
$
|
(9
|
)
|
|
|
As of June 30, 2015
|
||||||||||
|
Gross Amounts of Recognized Assets/Liabilities
|
|
Gross Amounts Offset in the Balance Sheet
(1)
|
|
Net Amounts of Assets/Liabilities Presented in the Balance Sheet
(2)
|
||||||
Assets
|
|
|
|
|
|
||||||
Currency swap(s)
(3)
|
$
|
61
|
|
|
$
|
—
|
|
|
$
|
61
|
|
Commodity derivatives under FTP
|
55
|
|
|
(55
|
)
|
|
—
|
|
|||
Total derivatives subject to master netting or similar arrangement
|
116
|
|
|
(55
|
)
|
|
61
|
|
|||
Total derivatives not subject to master netting or similar arrangement
|
3
|
|
|
—
|
|
|
3
|
|
|||
|
|
|
|
|
|
||||||
Total
|
$
|
119
|
|
|
$
|
(55
|
)
|
|
$
|
64
|
|
|
|
|
|
|
|
||||||
Liabilities
|
|
|
|
|
|
||||||
Currency swap(s)
(4)
|
$
|
23
|
|
|
$
|
—
|
|
|
$
|
23
|
|
Interest rate swaps
(4)
|
1,419
|
|
|
—
|
|
|
1,419
|
|
|||
Commodity derivatives under FTP
|
180
|
|
|
(146
|
)
|
|
34
|
|
|||
Total derivatives subject to master netting or similar arrangement
|
1,622
|
|
|
(146
|
)
|
|
1,476
|
|
|||
Total derivatives not subject to master netting or similar arrangement
|
128
|
|
|
—
|
|
|
128
|
|
|||
|
|
|
|
|
|
||||||
Total
|
$
|
1,750
|
|
|
$
|
(146
|
)
|
|
$
|
1,604
|
|
|
|
|
|
|
|
||||||
|
As of September 30, 2014
|
||||||||||
|
Gross Amounts of Recognized Assets/Liabilities
|
|
Gross Amounts Offset in the Balance Sheet
(1)
|
|
Net Amounts of Assets/Liabilities Presented in the Balance Sheet
(2)
|
||||||
Assets
|
|
|
|
|
|
||||||
Currency swap(s)
|
$
|
64
|
|
|
$
|
(64
|
)
|
|
$
|
—
|
|
Commodity derivatives under FTP
|
51
|
|
|
(51
|
)
|
|
—
|
|
|||
Total derivatives subject to master netting or similar arrangement
|
115
|
|
|
(115
|
)
|
|
—
|
|
|||
Total derivatives not subject to master netting or similar arrangement
|
1
|
|
|
—
|
|
|
1
|
|
|||
|
|
|
|
|
|
||||||
Total
|
$
|
116
|
|
|
$
|
(115
|
)
|
|
$
|
1
|
|
|
|
|
|
|
|
||||||
Liabilities
|
|
|
|
|
|
||||||
Currency swap(s)
(4)
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
15
|
|
Interest rate swaps
(4)
|
1,348
|
|
|
—
|
|
|
1,348
|
|
|||
Commodity derivatives under FTP
|
154
|
|
|
(120
|
)
|
|
34
|
|
|||
Total derivatives subject to master netting or similar arrangement
|
1,517
|
|
|
(120
|
)
|
|
1,397
|
|
|||
Total derivatives not subject to master netting or similar arrangement
|
97
|
|
|
—
|
|
|
97
|
|
|||
|
|
|
|
|
|
||||||
Total
|
$
|
1,614
|
|
|
$
|
(120
|
)
|
|
$
|
1,494
|
|
•
|
If TVA remains a majority-owned U.S. government entity but
Standard & Poor's Financial Services, LLC ("S&P")
or
Moody's Investors Service, Inc. ("Moody's")
downgrades TVA's credit rating to AA or Aa2, respectively, TVA's collateral obligations would likely increase by $
22 million
; and
|
•
|
If TVA ceases to be majority-owned by the U.S. government, TVA's credit rating would likely be downgraded and TVA would be required to post additional collateral.
|
Level 1
|
—
|
|
Unadjusted quoted prices in active markets accessible by the reporting entity for identical assets or liabilities. Active markets are those in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing.
|
Level 2
|
—
|
|
Pricing inputs other than quoted market prices included in Level 1 that are based on observable market data and that are directly or indirectly observable for substantially the full term of the asset or liability. These include quoted market prices for similar assets or liabilities, quoted market prices for identical or similar assets in markets that are not active, adjusted quoted market prices, inputs from observable data such as interest rate and yield curves, volatilities and default rates observable at commonly quoted intervals, and inputs derived from observable market data by correlation or other means.
|
Level 3
|
—
|
|
Pricing inputs that are unobservable, or less observable, from objective sources. Unobservable inputs are only to be used to the extent observable inputs are not available. These inputs maintain the concept of an exit price from the perspective of a market participant and should reflect assumptions of other market participants. An entity should consider all market participant assumptions that are available without unreasonable cost and effort. These are given the lowest priority and are generally used in internally developed methodologies to generate management's best estimate of the fair value when no observable market data is available.
|
|
Unrealized Investment Gains (Losses)
|
|
||||||||||||||||
|
|
|
For the Three Months Ended
June 30
|
|
For the Nine Months Ended
June 30
|
|
||||||||||||
|
Financial Statement Presentation
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
SERP
|
Other income (expense)
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
LTDCP
|
Other income (expense)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
||||
NDT
|
Regulatory asset
|
|
(19
|
)
|
|
36
|
|
|
15
|
|
|
72
|
|
|
||||
ART
|
Regulatory asset
|
|
(3
|
)
|
|
9
|
|
|
12
|
|
|
27
|
|
|
Fair Value Measurements
At June 30, 2015
|
|||||||||||||||
|
Quoted Prices in Active Markets for
Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Investments
|
|
|
|
|
|
|
|
||||||||
Equity securities
|
$
|
181
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
181
|
|
Debt securities
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. government corporations and
agencies
|
59
|
|
|
7
|
|
|
—
|
|
|
66
|
|
||||
Corporate debt securities
|
—
|
|
|
336
|
|
|
—
|
|
|
336
|
|
||||
Residential mortgage-backed securities
|
—
|
|
|
16
|
|
|
—
|
|
|
16
|
|
||||
Commercial mortgage-backed securities
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||
Collateralized debt obligations
|
—
|
|
|
29
|
|
|
—
|
|
|
29
|
|
||||
Private partnerships
|
—
|
|
|
—
|
|
|
238
|
|
|
238
|
|
||||
Commingled funds
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity security commingled funds
|
44
|
|
|
942
|
|
|
—
|
|
|
986
|
|
||||
Debt security commingled funds
|
44
|
|
|
178
|
|
|
—
|
|
|
222
|
|
||||
Total investments
|
328
|
|
|
1,513
|
|
|
238
|
|
|
2,079
|
|
||||
Currency swap(s)
(2)
|
—
|
|
|
61
|
|
|
—
|
|
|
61
|
|
||||
Commodity contract derivatives
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
||||
Commodity derivatives under FTP
(2)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Swap contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total
|
$
|
328
|
|
|
$
|
1,574
|
|
|
$
|
241
|
|
|
$
|
2,143
|
|
|
|
|
|
|
|
|
|
||||||||
|
Quoted Prices in Active Markets for Identical Liabilities
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
Currency swap(s)
(2)
|
$
|
—
|
|
|
$
|
23
|
|
|
$
|
—
|
|
|
$
|
23
|
|
Interest rate swaps
|
—
|
|
|
1,419
|
|
|
—
|
|
|
1,419
|
|
||||
Commodity contract derivatives
|
—
|
|
|
—
|
|
|
128
|
|
|
128
|
|
||||
Commodity derivatives under FTP
(2)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Swap contracts
|
—
|
|
|
34
|
|
|
—
|
|
|
34
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total
|
$
|
—
|
|
|
$
|
1,476
|
|
|
$
|
128
|
|
|
$
|
1,604
|
|
Fair Value Measurements
At September 30, 2014
|
|||||||||||||||
|
Quoted Prices in Active Markets for
Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Investments
|
|
|
|
|
|
|
|
||||||||
Equity securities
|
$
|
162
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
162
|
|
Debt securities
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. government corporations and
agencies
|
46
|
|
|
39
|
|
|
—
|
|
|
85
|
|
||||
Corporate debt securities
|
—
|
|
|
290
|
|
|
—
|
|
|
290
|
|
||||
Residential mortgage-backed securities
|
—
|
|
|
14
|
|
|
—
|
|
|
14
|
|
||||
Commercial mortgage-backed securities
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
||||
Collateralized debt obligations
|
—
|
|
|
29
|
|
|
—
|
|
|
29
|
|
||||
Private partnerships
|
—
|
|
|
—
|
|
|
214
|
|
|
214
|
|
||||
Commingled funds
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity security commingled funds
|
40
|
|
|
903
|
|
|
—
|
|
|
943
|
|
||||
Debt security commingled funds
|
61
|
|
|
176
|
|
|
—
|
|
|
237
|
|
||||
Total investments
|
309
|
|
|
1,458
|
|
|
214
|
|
|
1,981
|
|
||||
Currency swap(s)
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Commodity contract derivatives
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||
Commodity derivatives under FTP
(2)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Swap contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total
|
$
|
309
|
|
|
$
|
1,458
|
|
|
$
|
215
|
|
|
$
|
1,982
|
|
|
|
|
|
|
|
|
|
||||||||
|
Quoted Prices in Active Markets for Identical Liabilities
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
Currency swap(s)
(2)
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
15
|
|
Interest rate swaps
|
—
|
|
|
1,348
|
|
|
—
|
|
|
1,348
|
|
||||
Commodity contract derivatives
|
—
|
|
|
—
|
|
|
97
|
|
|
97
|
|
||||
Commodity derivatives under FTP
(2)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Swap contracts
|
—
|
|
|
34
|
|
|
—
|
|
|
34
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total
|
$
|
—
|
|
|
$
|
1,397
|
|
|
$
|
97
|
|
|
$
|
1,494
|
|
Fair Value Measurements Using Significant Unobservable Inputs
|
||||||||||||||||
|
For the Three Months Ended
June 30 |
|
For the Nine Months Ended
June 30 |
|||||||||||||
|
Private
Partnerships
|
|
Commodity Contract Derivatives
|
|
Private
Partnerships
|
|
Commodity Contract Derivatives
|
|
||||||||
Balance at beginning of period
|
$
|
180
|
|
|
$
|
(131
|
)
|
|
$
|
159
|
|
|
$
|
(140
|
)
|
|
Purchases
|
7
|
|
|
—
|
|
|
23
|
|
|
—
|
|
|
||||
Issuances
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
||||
Sales
|
(6
|
)
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
||||
Settlements
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
||||
Net unrealized gains (losses) deferred as regulatory assets and liabilities
|
7
|
|
|
(15
|
)
|
|
13
|
|
|
(6
|
)
|
|
||||
Balance at June 30, 2014
|
$
|
188
|
|
|
$
|
(146
|
)
|
|
$
|
188
|
|
|
$
|
(146
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
$
|
223
|
|
|
$
|
(149
|
)
|
|
$
|
214
|
|
|
$
|
(96
|
)
|
|
Purchases
|
11
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|
||||
Issuances
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
||||
Sales
|
(5
|
)
|
|
—
|
|
|
(12
|
)
|
|
—
|
|
|
||||
Settlements
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
||||
Net unrealized gains (losses) deferred as regulatory assets and liabilities
|
9
|
|
|
24
|
|
|
15
|
|
|
(29
|
)
|
|
||||
Balance at June 30, 2015
|
$
|
238
|
|
|
$
|
(125
|
)
|
|
$
|
238
|
|
|
$
|
(125
|
)
|
|
Other Income (Expense), Net
|
||||||||||||||||
|
For the Three Months Ended
June 30 |
|
For the Nine Months Ended
June 30 |
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||
Interest income
|
$
|
6
|
|
|
$
|
6
|
|
|
$
|
18
|
|
|
$
|
17
|
|
|
External services
|
3
|
|
|
3
|
|
|
9
|
|
|
15
|
|
|
||||
Gains (losses) on investments
|
—
|
|
|
2
|
|
|
3
|
|
|
4
|
|
|
||||
Miscellaneous
|
(1
|
)
|
|
(1
|
)
|
|
(5
|
)
|
|
1
|
|
|
||||
Total other income (expense), net
|
$
|
8
|
|
|
$
|
10
|
|
|
$
|
25
|
|
|
$
|
37
|
|
|
Components of TVA’s Benefit Plans
|
||||||||||||||||||||||||||||||||
|
For the Three Months Ended June 30
|
|
For the Nine Months Ended June 30
|
|
||||||||||||||||||||||||||||
|
Pension Benefits
|
|
Other Post-Retirement Benefits
|
|
Pension Benefits
|
|
Other Post-Retirement Benefits
|
|
||||||||||||||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||||||||||
Service cost
|
$
|
32
|
|
|
$
|
33
|
|
|
$
|
4
|
|
|
$
|
5
|
|
|
$
|
97
|
|
|
$
|
98
|
|
|
$
|
12
|
|
|
$
|
14
|
|
|
Interest cost
|
135
|
|
|
139
|
|
|
7
|
|
|
8
|
|
|
405
|
|
|
418
|
|
|
22
|
|
|
24
|
|
|
||||||||
Expected return on plan assets
|
(110
|
)
|
|
(109
|
)
|
|
—
|
|
|
—
|
|
|
(328
|
)
|
|
(326
|
)
|
|
—
|
|
|
—
|
|
|
||||||||
Amortization of prior service credit
|
(5
|
)
|
|
(5
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
(16
|
)
|
|
(16
|
)
|
|
(5
|
)
|
|
(5
|
)
|
|
||||||||
Recognized net actuarial loss
|
75
|
|
|
71
|
|
|
3
|
|
|
3
|
|
|
225
|
|
|
214
|
|
|
7
|
|
|
8
|
|
|
||||||||
Total net periodic benefit cost as actuarially determined
|
127
|
|
|
129
|
|
|
12
|
|
|
14
|
|
|
383
|
|
|
388
|
|
|
36
|
|
|
41
|
|
|
||||||||
Amount capitalized due to actions of regulator
|
(57
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(171
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
||||||||
Total net periodic benefit cost
|
$
|
70
|
|
|
$
|
129
|
|
|
$
|
12
|
|
|
$
|
14
|
|
|
$
|
212
|
|
|
$
|
388
|
|
|
$
|
36
|
|
|
$
|
41
|
|
|
•
|
Petition to Immediately Suspend the Operating Licenses of GE BWR Mark I Units Pending the Full NRC Review With Independent Expert and Public Participation From Affected Emergency Planning Zone Communities
|
•
|
Petition Pursuant to 10 CFR 2.206 - Demand For Information Regarding Compliance with 10 CFR 50, Appendix A, General Design Criterion 44, Cooling Water, and 10 CFR 50.49, Environmental Qualification of Electric Equipment Important to Safety for Nuclear Power Plants
|
Sales of Electricity
(millions of kWh)
|
||||||||||||||||||||||||
|
Three Months Ended June 30
|
|
Nine Months Ended June 30
|
|
||||||||||||||||||||
|
2015
|
|
2014
|
|
Change
|
|
Percent Change
|
|
2015
|
|
2014
|
|
Change
|
|
Percent Change
|
|
||||||||
Local power companies
|
32,108
|
|
|
31,731
|
|
|
377
|
|
|
1.2
|
%
|
|
100,823
|
|
|
101,275
|
|
|
(452
|
)
|
|
(0.4
|
)%
|
|
Industries directly served
|
4,333
|
|
|
4,450
|
|
|
(117
|
)
|
|
(2.6
|
)%
|
|
12,832
|
|
|
13,026
|
|
|
(194
|
)
|
|
(1.5
|
)%
|
|
Federal agencies and other
|
802
|
|
|
684
|
|
|
118
|
|
|
17.3
|
%
|
|
2,055
|
|
|
2,263
|
|
|
(208
|
)
|
|
(9.2
|
)%
|
|
Total sales of electricity
|
37,243
|
|
|
36,865
|
|
|
378
|
|
|
1.0
|
%
|
|
115,710
|
|
|
116,564
|
|
|
(854
|
)
|
|
(0.7
|
)%
|
|
Degree Days
|
||||||||||||||||||||||||||
|
2015
Actual
|
|
Normal
(1)
|
|
Percent Variation
|
|
2014
Actual
|
|
Normal
(1)
|
|
Percent Variation
|
|
2015
Actual |
|
2014
Actual |
|
Percent Change
|
|||||||||
Heating Degree Days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Three Months Ended June 30
|
120
|
|
|
228
|
|
|
(47.4
|
)%
|
|
199
|
|
|
228
|
|
|
(12.7
|
)%
|
|
120
|
|
|
199
|
|
|
(39.7
|
)%
|
Nine Months Ended June 30
|
3,551
|
|
|
3,343
|
|
|
6.2
|
%
|
|
3,697
|
|
|
3,343
|
|
|
10.6
|
%
|
|
3,551
|
|
|
3,697
|
|
|
(3.9
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Cooling Degree Days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Three Months Ended June 30
|
698
|
|
|
586
|
|
|
19.1
|
%
|
|
651
|
|
|
586
|
|
|
11.1
|
%
|
|
698
|
|
|
651
|
|
|
7.2
|
%
|
Nine Months Ended June 30
|
780
|
|
|
666
|
|
|
17.1
|
%
|
|
743
|
|
|
666
|
|
|
11.6
|
%
|
|
780
|
|
|
743
|
|
|
5.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary Consolidated Statements of Operations
|
||||||||||||||||||||||
|
Three Months Ended June 30
|
|
Nine Months Ended June 30
|
|
||||||||||||||||||
|
2015
|
|
2014
|
|
Percent Change
|
|
2015
|
|
2014
|
|
Percent Change
|
|
||||||||||
Operating revenues
|
$
|
2,558
|
|
|
$
|
2,651
|
|
|
(3.5
|
)%
|
|
$
|
7,832
|
|
|
$
|
7,971
|
|
|
(1.7
|
)%
|
|
Operating expenses
|
2,252
|
|
|
2,453
|
|
|
(8.2
|
)%
|
|
6,386
|
|
|
6,979
|
|
|
(8.5
|
)%
|
|
||||
Operating income
|
306
|
|
|
198
|
|
|
54.5
|
%
|
|
1,446
|
|
|
992
|
|
|
45.8
|
%
|
|
||||
Other income, net
|
8
|
|
|
10
|
|
|
(20.0
|
)%
|
|
25
|
|
|
37
|
|
|
(32.4
|
)%
|
|
||||
Interest expense, net
|
282
|
|
|
289
|
|
|
(2.4
|
)%
|
|
862
|
|
|
882
|
|
|
(2.3
|
)%
|
|
||||
Net income (loss)
|
$
|
32
|
|
|
$
|
(81
|
)
|
|
139.5
|
%
|
|
$
|
609
|
|
|
$
|
147
|
|
|
314.3
|
%
|
|
Operating Revenues
|
||||||||||||||||||||||
|
Three Months Ended June 30
|
|
Nine Months Ended June 30
|
|
||||||||||||||||||
|
2015
|
|
2014
|
|
Percent Change
|
|
2015
|
|
2014
|
|
Percent Change
|
|
||||||||||
Revenue from sales of electricity
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Local power companies
|
$
|
2,318
|
|
|
$
|
2,383
|
|
|
(2.7
|
)%
|
|
$
|
7,135
|
|
|
$
|
7,217
|
|
|
(1.1
|
)%
|
|
Industries directly served
|
167
|
|
|
197
|
|
|
(15.2
|
)%
|
|
485
|
|
|
539
|
|
|
(10.0
|
)%
|
|
||||
Federal agencies and other
|
37
|
|
|
38
|
|
|
(2.6
|
)%
|
|
102
|
|
|
113
|
|
|
(9.7
|
)%
|
|
||||
Revenue from sales of electricity
|
2,522
|
|
|
2,618
|
|
|
(3.7
|
)%
|
|
7,722
|
|
|
7,869
|
|
|
(1.9
|
)%
|
|
||||
Other revenue
|
36
|
|
|
33
|
|
|
9.1
|
%
|
|
110
|
|
|
102
|
|
|
7.8
|
%
|
|
||||
Total operating revenues
|
$
|
2,558
|
|
|
$
|
2,651
|
|
|
(3.5
|
)%
|
|
$
|
7,832
|
|
|
$
|
7,971
|
|
|
(1.7
|
)%
|
|
|
Three Month Change
|
|
Nine Month Change
|
|
||||
Fuel cost recovery
|
$
|
(136
|
)
|
|
$
|
(269
|
)
|
|
Base revenue
|
42
|
|
|
136
|
|
|
||
Off-system sales
|
(2
|
)
|
|
(14
|
)
|
|
||
Other revenue
|
3
|
|
|
8
|
|
|
||
Total
|
$
|
(93
|
)
|
|
$
|
(139
|
)
|
|
Operating Expenses
|
||||||||||||||||||||||
|
Three Months Ended June 30
|
|
Nine Months Ended June 30
|
|
||||||||||||||||||
|
2015
|
|
2014
|
|
Percent
Change
|
|
2015
|
|
2014
|
|
Percent
Change
|
|
||||||||||
Fuel
|
$
|
608
|
|
|
$
|
698
|
|
|
(12.9
|
)%
|
|
$
|
1,744
|
|
|
$
|
1,904
|
|
|
(8.4
|
)%
|
|
Purchased power
|
244
|
|
|
279
|
|
|
(12.5
|
)%
|
|
736
|
|
|
843
|
|
|
(12.7
|
)%
|
|
||||
Operating and maintenance
|
738
|
|
|
880
|
|
|
(16.1
|
)%
|
|
2,083
|
|
|
2,480
|
|
|
(16.0
|
)%
|
|
||||
Depreciation and amortization
|
534
|
|
|
463
|
|
|
15.3
|
%
|
|
1,440
|
|
|
1,357
|
|
|
6.1
|
%
|
|
||||
Tax equivalents
|
128
|
|
|
133
|
|
|
(3.8
|
)%
|
|
383
|
|
|
395
|
|
|
(3.0
|
)%
|
|
||||
Total operating expenses
|
$
|
2,252
|
|
|
$
|
2,453
|
|
|
(8.2
|
)%
|
|
$
|
6,386
|
|
|
$
|
6,979
|
|
|
(8.5
|
)%
|
|
Power Supply from TVA-Operated Generation Facilities and Purchased Power
|
||||||||||||||||||||||
|
Three Months Ended June 30
|
|
Nine Months Ended June 30
|
|
||||||||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
||||||||||||||
|
kWh
(in millions) |
|
Percent of Total Power Supply
|
|
kWh
(in millions) |
|
Percent of Total Power Supply
|
|
kWh
(in millions) |
|
Percent of Total Power Supply
|
|
kWh
(in millions) |
|
Percent of Total Power Supply
|
|
||||||
Coal-fired
|
12,824
|
|
|
34
|
%
|
|
15,624
|
|
42
|
%
|
|
39,511
|
|
34
|
%
|
|
44,916
|
|
|
38
|
%
|
|
Nuclear
|
13,173
|
|
|
35
|
%
|
|
12,451
|
|
33
|
%
|
|
40,981
|
|
35
|
%
|
|
39,669
|
|
|
33
|
%
|
|
Hydroelectric
|
2,427
|
|
|
6
|
%
|
|
1,868
|
|
5
|
%
|
|
10,766
|
|
9
|
%
|
|
10,609
|
|
|
9
|
%
|
|
Natural gas and/or oil-fired
|
5,037
|
|
|
13
|
%
|
|
3,198
|
|
9
|
%
|
|
12,311
|
|
10
|
%
|
|
8,961
|
|
|
8
|
%
|
|
Renewable resources (non-hydro)
|
—
|
|
|
—
|
%
|
|
3
|
|
—
|
%
|
|
0
|
|
—
|
%
|
|
5
|
|
|
—
|
%
|
|
Total TVA-operated generation facilities
|
33,461
|
|
88
|
%
|
|
33,144
|
|
89
|
%
|
|
103,569
|
|
88
|
%
|
|
104,160
|
|
|
88
|
%
|
|
|
Purchased power
|
4,587
|
|
|
12
|
%
|
|
4,303
|
|
11
|
%
|
|
14,346
|
|
12
|
%
|
|
14,493
|
|
|
12
|
%
|
|
Total power supply
|
38,048
|
|
|
100
|
%
|
|
37,447
|
|
100
|
%
|
|
117,915
|
|
100
|
%
|
|
118,653
|
|
|
100
|
%
|
|
Interest Expense
|
||||||||||||||||||||||
|
Three Months Ended June 30
|
|
Nine Months Ended June 30
|
|
||||||||||||||||||
|
2015
|
|
2014
|
|
Percent
Change
|
|
2015
|
|
2014
|
|
Percent
Change
|
|
||||||||||
Interest Expense
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
$
|
337
|
|
|
$
|
334
|
|
|
0.9
|
%
|
|
$
|
1,020
|
|
|
$
|
1,009
|
|
|
1.1
|
%
|
|
Allowance for funds used during construction
|
(55
|
)
|
|
(45
|
)
|
|
22.2
|
%
|
|
(158
|
)
|
|
(127
|
)
|
|
24.4
|
%
|
|
||||
Net interest expense
|
$
|
282
|
|
|
$
|
289
|
|
|
(2.4
|
)%
|
|
$
|
862
|
|
|
$
|
882
|
|
|
(2.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
2015
|
|
2014
|
|
Percent
Change
|
|
2015
|
|
2014
|
|
Percent
Change
|
|
||||||||||
Interest Rates (average)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Long-term outstanding power bonds
(2)
|
5.537
|
%
|
|
5.601
|
%
|
|
(1.1
|
)%
|
|
5.505
|
%
|
|
5.594
|
%
|
|
(1.6
|
)%
|
|
||||
Long-term debt of variable interest entities
|
4.610
|
%
|
|
4.602
|
%
|
|
0.2
|
%
|
|
4.608
|
%
|
|
4.601
|
%
|
|
0.2
|
%
|
|
||||
Membership interests subject to mandatory redemption
|
7.000
|
%
|
|
7.000
|
%
|
|
—
|
%
|
|
7.000
|
%
|
|
7.022
|
%
|
|
(0.3
|
)%
|
|
||||
Discount notes
|
0.051
|
%
|
|
0.047
|
%
|
|
8.5
|
%
|
|
0.048
|
%
|
|
0.049
|
%
|
|
(2.0
|
)%
|
|
||||
Blended
|
5.164
|
%
|
|
5.192
|
%
|
|
(0.5
|
)%
|
|
5.228
|
%
|
|
5.144
|
%
|
|
1.6
|
%
|
|
Short-Term Borrowing Table
|
|
|||||||||||||||||||||||
|
At
June 30
2015 |
|
Three Months Ended June 30 2015
|
|
Nine Months Ended June 30 2015
|
|
At
June 30
2014
|
|
Three Months Ended June 30 2014
|
|
Nine Months Ended June 30 2014
|
|
||||||||||||
Amount Outstanding (at End of Period) or Average Amount Outstanding (During Period)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Discount Notes
|
$
|
2,582
|
|
|
$
|
1,550
|
|
|
$
|
1,089
|
|
|
$
|
1,759
|
|
|
$
|
1,631
|
|
|
$
|
1,827
|
|
|
Weighted Average Interest Rate
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Discount Notes
|
0.047
|
%
|
|
0.051
|
%
|
|
0.048
|
%
|
|
0.059
|
%
|
|
0.047
|
%
|
|
0.049
|
%
|
|
||||||
Maximum Month-End Amount Outstanding (During Period)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Discount Notes
|
N/A
|
|
|
$
|
2,582
|
|
|
$
|
2,582
|
|
|
N/A
|
|
|
$
|
1,759
|
|
|
$
|
2,442
|
|
|
Summary Cash Flows
|
|||||||
|
Nine Months Ended June 30
|
||||||
|
2015
|
|
2014
|
||||
Cash provided by (used in):
|
|
|
|
||||
Operating activities
|
$
|
2,016
|
|
|
$
|
1,987
|
|
Investing activities
|
(2,690
|
)
|
|
(1,961
|
)
|
||
Financing activities
|
674
|
|
|
(1,123
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
$
|
—
|
|
|
$
|
(1,097
|
)
|
Commitments and Contingencies
Payments due in the year ending September 30
|
|||||||||||||||||||||||||||
|
2015
(1)
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
Thereafter
|
|
Total
|
||||||||||||||
Debt
(2)
|
$
|
2,582
|
|
|
$
|
32
|
|
|
$
|
1,555
|
|
|
$
|
1,682
|
|
|
$
|
1,032
|
|
|
$
|
17,544
|
|
|
$
|
24,427
|
|
Interest payments relating to debt
|
223
|
|
|
1,168
|
|
|
1,154
|
|
|
1,065
|
|
|
989
|
|
|
17,047
|
|
|
21,646
|
|
|||||||
Debt of VIEs
|
16
|
|
|
33
|
|
|
35
|
|
|
36
|
|
|
38
|
|
|
1,138
|
|
|
1,296
|
|
|||||||
Interest payments relating to debt of VIEs
|
29
|
|
|
58
|
|
|
58
|
|
|
56
|
|
|
54
|
|
|
693
|
|
|
948
|
|
|||||||
Lease obligations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Capital
|
4
|
|
|
13
|
|
|
13
|
|
|
13
|
|
|
12
|
|
|
168
|
|
|
223
|
|
|||||||
Non-cancelable operating
|
11
|
|
|
41
|
|
|
38
|
|
|
28
|
|
|
25
|
|
|
63
|
|
|
206
|
|
|||||||
Purchase obligations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Power
|
62
|
|
|
220
|
|
|
229
|
|
|
233
|
|
|
239
|
|
|
3,365
|
|
|
4,348
|
|
|||||||
Fuel
|
416
|
|
|
1,047
|
|
|
563
|
|
|
571
|
|
|
504
|
|
|
1,579
|
|
|
4,680
|
|
|||||||
Other
|
165
|
|
|
260
|
|
|
216
|
|
|
212
|
|
|
210
|
|
|
1,938
|
|
|
3,001
|
|
|||||||
Environmental Agreements
|
28
|
|
|
55
|
|
|
36
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
133
|
|
|||||||
Membership interest of VIE subject to mandatory redemption
|
1
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
29
|
|
|
38
|
|
|||||||
Interest payments related to membership interests of VIE subject to mandatory redemption
|
1
|
|
|
3
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
15
|
|
|
25
|
|
|||||||
Flood response commitment to NRC
|
6
|
|
|
11
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||||
Litigation settlements
|
7
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|||||||
Unfunded loan commitments
|
7
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|||||||
Environmental cleanup costs -Kingston ash spill
|
3
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
11
|
|
|
18
|
|
|||||||
Payments on other financings
|
10
|
|
|
103
|
|
|
104
|
|
|
104
|
|
|
96
|
|
|
305
|
|
|
722
|
|
|||||||
Payments to U.S. Treasury - Return on Power Program Appropriation Investment
|
5
|
|
|
8
|
|
|
8
|
|
|
8
|
|
|
8
|
|
|
85
|
|
|
122
|
|
|||||||
Retirement plan
(3)
|
78
|
|
|
209
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
287
|
|
|||||||
Total
|
$
|
3,654
|
|
|
$
|
3,275
|
|
|
$
|
4,015
|
|
|
$
|
4,027
|
|
|
$
|
3,212
|
|
|
$
|
43,980
|
|
|
$
|
62,163
|
|
Energy Prepayment Obligations
Obligations due in the year ending September 30
|
|||||||||||||||||||||||||||
|
2015
(1)
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
Thereafter
|
|
Total
|
||||||||||||||
Energy Prepayment Obligations
|
$
|
25
|
|
|
$
|
100
|
|
|
$
|
100
|
|
|
$
|
100
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
335
|
|
Air, Water, and Waste Quality Estimated Potential Environmental Expenditures
(1)
At June 30, 2015
(in millions)
|
|||||
|
Estimated Timetable
|
|
Total Estimated Expenditures
|
||
|
|
|
|
||
Site environmental remediation costs
(2)
|
2015+
|
|
$
|
9
|
|
Coal combustion residual conversion program
(3)
|
2015-2022
|
|
$
|
1,300
|
|
Proposed clean air projects
(4)
|
2015-2025
|
|
$
|
800
|
|
Clean Water Act requirements
(5)
|
2015-2022
|
|
$
|
300
|
|
Date:
|
August 3, 2015
|
|
TENNESSEE VALLEY AUTHORITY
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ William D. Johnson
|
|
|
|
William D. Johnson
|
|
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
|
|
By:
|
/s/ John M. Thomas, III
|
|
|
|
John M. Thomas, III
|
|
|
|
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
SECTION 1
|
||
PURPOSE AND SCOPE........................................................................................................
|
4
|
|
1.1 Establishment............................................................................................................
|
4
|
|
1.2 Purpose.....................................................................................................................
|
4
|
|
SECTION 2
|
|
|
DEFINITIONS........................................................................................................................
|
4
|
|
2.1 Accrued Benefit.........................................................................................................
|
4
|
|
2.2 Actuarial Equivalent...................................................................................................
|
4
|
|
2.3 Approved Termination................................................................................................
|
4
|
|
2.4 Average Compensation.............................................................................................
|
5
|
|
2.5 Beneficiary.................................................................................................................
|
5
|
|
2.6 Board.........................................................................................................................
|
5
|
|
2.7 Compensation...........................................................................................................
|
5
|
|
2.8 Credited Service .......................................................................................................
|
5
|
|
2.9 Date of Benefit Commencement...............................................................................
|
5
|
|
2.10 Normal Retirement Date............................................................................................
|
5
|
|
2.11 Participants................................................................................................................
|
5
|
|
2.12 Plan Year...................................................................................................................
|
5
|
|
2.13 Prior Employer Offset................................................................................................
|
6
|
|
2.14 Qualified Plan............................................................................................................
|
6
|
|
2.15 Qualified Plan Offset..................................................................................................
|
6
|
|
2.16 Retirement Committee..............................................................................................
|
6
|
|
2.17 Separation from Service............................................................................................
|
6
|
|
2.18 Social Security Offset................................................................................................
|
6
|
|
2.19 Unapproved Termination...........................................................................................
|
7
|
|
2.20 TVA's Nonelective Contributions...............................................................................
|
7
|
|
SECTION 3
|
|
|
PARTICIPATION....................................................................................................................
|
7
|
|
3.1 Tier One Eligibility......................................................................................................
|
7
|
|
3.2 Tier Two Eligibility......................................................................................................
|
7
|
|
SECTION 4
|
||
BENEFIT ELIGIBILITY AND CALCULATION.........................................................................
|
7
|
|
4.1 Vesting.......................................................................................................................
|
7
|
|
4.2 Accrued Benefit.........................................................................................................
|
7
|
|
4.3 Benefit Payable for Approved Termination................................................................
|
8
|
|
4.4 Benefit Payable for Death Prior to Date of Benefit Commencement.........................
|
8
|
|
4.5 Benefit Payable for Unapproved Termination............................................................
|
8
|
|
4.6 Benefit Payable for Change in Role..........................................................................
|
9
|
|
SECTION 5
|
||
PAYMENT OF BENEFITS......................................................................................................
|
9
|
|
5.1 Terms and Conditions of Benefit Payments...............................................................
|
9
|
|
5.2 Payment to Beneficiary..............................................................................................
|
10
|
|
5.3 Alienation of Benefits Prohibited................................................................................
|
10
|
|
5.4 Incapacity...................................................................................................................
|
10
|
|
SECTION 6
|
||
GENERAL PROVISIONS.......................................................................................................
|
10
|
|
6.1 Funding.....................................................................................................................
|
10
|
|
6.2 Right to Amend, Suspend, or Terminate....................................................................
|
11
|
|
6.3 Right to Benefit..........................................................................................................
|
11
|
|
6.4 Administration of the Plan..........................................................................................
|
11
|
|
6.5 Titles..........................................................................................................................
|
12
|
|
6.6 Governing Law..........................................................................................................
|
12
|
|
6.7 Separability................................................................................................................
|
12
|
|
6.8 Authorized Officers....................................................................................................
|
12
|
|
6.9 Certain Rights and Limitations..................................................................................
|
12
|
|
6.10 Compliance with Section 409A..................................................................................
|
12
|
|
1.2
|
Purpose. The purpose of the Plan is: (a) to provide a competitive retirement benefit level that cannot be delivered solely through TVA’s qualified retirement plans due to IRS limitations and (b) to provide a benefit level (as a percentage replacement of pre-retirement pay) that is more comparable to that of employees who are not subject to the IRS limitations.
|
2.1
|
"Accrued Benefit" means an annual benefit commencing at the later of (a) the Normal Retirement Date or (b) the Participant's age at the time of Separation from Service, and continuing during the expected lifetime of the Participant based on the applicable mortality table used by the TVA Retirement System.
|
2.2
|
"Actuarial Equivalent" means a benefit of equal value to a benefit otherwise payable in a different form or at a different time under the Plan, when computed on the basis of the mortality and interest rate used by the TVA Retirement System as in effect on the date distribution is made.
|
2.3
|
"Approved Termination" means termination of employment with TVA due to (a) retirement on or after the Participant's Normal Retirement Date, (b) retirement on or after attainment of actual age 55, if such retirement has the approval of the Board or its delegatee, (c) death in service as an employee, (d) disability (as such term is defined under the Rules and Regulations of the TVA Retirement System) as determined by the Retirement Committee, or (e) any other circumstances approved by the Board or its delegatee.
|
2.4
|
"Average Compensation" means the highest average of Compensation during three consecutive Plan Years. If a Participant has been an employee of TVA for less than three Plan Years, the average shall be determined based on the period of employment.
|
2.5
|
"Beneficiary" shall mean the person or persons, designated in writing by a Participant, who are to receive a benefit under this Plan in the event of a Participant's death. In the absence of any designated beneficiary or in the event that the designated beneficiary is deceased, then the beneficiary shall be the Participant's estate.
|
2.6
|
"Board" means the Board of Directors of TVA.
|
2.7
|
"Compensation" means the sum of annual salary, unreduced by contributions under Internal Revenue Code sections 125, 132 and 402 (a)(8), plus annual incentive award.
|
2.8
|
"Credited Service" means actual service with TVA plus any additional service which the Board, or its delegatee, approves under this Plan.
|
2.9
|
"Date of Benefit Commencement" means the date benefit payments begin upon the later of (a) the date the Participant turns age 55, or (b) the date of the Participant’s Separation from Service.
|
2.10
|
"Normal Retirement Date" shall mean the first of the month coincident with or next following the date on which the Participant has attained age 62.
|
2.11
|
"Participants" shall mean those employees participating in the Plan as provided in section 3.
|
2.12
|
"Plan Year" is TVA's fiscal year, October 1 to September 30.
|
2.13
|
"Prior Employer Offset" means the Actuarial Equivalent of the benefit earned under a prior employers' qualified defined benefit pension plan or plans attributable to prior employer service, which is included in Credited Service under this Plan, assuming benefit payments are to begin at the Normal Retirement Date. A Prior Employer Offset shall only apply if all or a portion of the period of service during which such benefit was earned is included in Credited Service. The Board or its delegatee may, in its sole discretion, waive all or part of the Prior Employer Offset for any Participant.
|
2.14
|
"Qualified Plan" means the retirement plan under which a Participant accrues benefits for his or her TVA service and may be any of the TVA Retirement System, the Civil Service Retirement System, or the Federal Employees Retirement System.
|
2.15
|
“Qualified Plan Offset” means, in the absence of separate authorized TVA documentation defining the Qualified Plan offset, the Actuarial Equivalent of the Participant’s benefit, calculated as follows, and assuming the maximum benefit with no survivor elections and benefit payments beginning at the Normal Retirement Date:
|
2.16
|
"Retirement Committee" means a group of three persons appointed by the Board or its delegatee to administer the Plan.
|
2.17
|
"Separation from Service" or "separates from service" means the same as the term "separation from service" as defined in 26 CFR §1.409A-1(h) of the Internal Revenue Code
,
Section 409A
,
final regulations.
|
2.19
|
"Unapproved Termination" means a termination of employment with TVA that does not constitute an Approved Termination as such term is defined in section 2.3.
|
2.20
|
“TVA’s nonelective contributions” shall have the same definition as found in the Provisions of the Tennessee Valley Authority Savings and Deferral Retirement Plan.
|
4.1
|
Vesting. A Participant will vest in his/her Accrued Benefit (a) after five (5) years of actual TVA service, unless otherwise waived by the Board or its delegatee, (b) upon death in service as an employee, or (c) upon disability (as such term is defined under the Rules and Regulations of the TVA Retirement System) as determined by the Retirement Committee.
|
4.2
|
Accrued Benefit. A Participant's Accrued Benefit is calculated at the time of the Participant's Separation from Service as set forth below:
|
4.2.1
|
Tier One Participants. The Accrued Benefit for Tier One Participants shall be equal to (a) the lesser of (i) 2.5 percent of Average Compensation times years of Credited Service and (ii) 60 percent of Average Compensation, minus (b) the sum of the Qualified Plan Offset, the Prior Employer Offset, and the Social Security Offset.
|
4.2.2
|
Tier Two Participants. The Accrued Benefit for Tier Two Participants shall be equal to (a) 1.3 percent, times (b) years of Credited Service, times (c) the difference of (i) Average Compensation minus (ii) earnable compensation as defined in the Qualified Plan.
|
4.3
|
Benefit Payable for Approved Termination. In the event of an Approved Termination, the Participant shall be eligible to receive a benefit equal to the Accrued Benefit subject to the reduction below. In the event the Participant separates from service prior to the Normal Retirement Date, the Accrued Benefit shall be reduced by 5/12 percent for each month that the Date of Benefit Commencement precedes the Normal Retirement Date; however, in no event shall the benefit be reduced by more than 35 percent.
|
4.4
|
Benefit Payable for Death Prior to Date of Benefit Commencement. In the event of a Participant's death prior to the Date of Benefit Commencement, the Participant's Beneficiary shall receive a lump-sum benefit that is the Actuarial Equivalent of the Accrued Benefit that would have been payable had the Participant separated from service on the date of death and elected a joint and 50 percent survivor benefit.
|
4.5
|
Benefit Payable for Unapproved Termination. In the event of an Unapproved Termination, the Participant shall receive a benefit equal to the Accrued Benefit subject to the reductions below.
|
4.6
|
Benefit Payable for Change in Role. Effective May 1, 2015, and prospectively only, in the event a Participant’s eligibility under the Plan changes due to a change in role, the Participant shall receive a benefit as explained below unless otherwise approved by the Board or its delegatee.
|
4.6.1
|
Tier One Participant. In the event the Participant no longer meets eligibility requirements to be included in Tier One, benefits will be frozen and credited service for Tier One benefits will end effective the date of the change in role. If the new role is eligible for Tier Two, the Participant will begin accruing Tier Two benefits effective the date of the change in role. If the new role is not eligible for Tier Two, benefits will be frozen effective the date of the change in role, and no further benefits will accrue under the Plan.
|
4.6.2
|
Tier Two Participants. In the event a Tier Two participant becomes a Tier One participant, all SERP benefits will be paid as Tier One for the participant’s total credited service. If a new role is not eligible for Tier One or Tier Two, benefits will be frozen effective the date of the change in role, and no further benefits will accrue under the Plan.
|
5.1
|
Terms and Conditions of Benefit Payments. The benefit calculated under section 4 above will be paid as follows:
|
5.1.1
|
For Participants in the Plan prior to January 1, 2009, the benefit calculated under section 4 will be paid in the Actuarial Equivalent form of five (5) annual installments, unless a Participant has validly elected pursuant to IRS transition rules prior to January 1, 2009, to receive payments in the Actuarial Equivalent form of ten (10) annual installments.
|
5.1.2
|
For Participants first in the Plan on or after January 1, 2009, the benefit calculated under section 4 will be paid in the Actuarial Equivalent form of five (5) annual installments, unless a Participant has validly elected under IRS rules within thirty (30) days of becoming a participant in the Plan, to receive payments in the Actuarial Equivalent form of ten (10) annual installments.
|
5.1.3
|
The first annual installment pursuant to sections 5.1.1 and 5.1.2 above will be paid on the Date of Benefit Commencement, and subsequent annual installments will be paid in January of each succeeding year.
|
5.2
|
Payment to Beneficiary. In the event the Participant dies following the Date of Benefit Commencement but prior to the final annual installment, the remaining unpaid benefit due the Participant will be paid to the Participant's Beneficiary following the Participant's death in a lump sum calculated to be the Actuarial Equivalent of the remaining unpaid benefit due the Participant.
|
5.3
|
Alienation of Benefits Prohibited. No benefit payable at any time under the Plan shall be subject in any manner to alienation, anticipation, sale, transfer, assignment, pledge, attachment, or encumbrance or any kind, except as required by law. No benefit payable at any time under the Plan shall be subject in any manner to the debts or liabilities of any person entitled to such benefit, and TVA shall not be required to make any payments toward such debts or liabilities.
|
5.4
|
Incapacity. In the event that any benefit hereunder is, or becomes, payable to a minor, to a person under a legal disability, or to a person not judicially declared incompetent but who by reason of illness or mental or physical disability is, in the opinion of the Retirement Committee, incapable of personally receiving and giving valid receipt for such payment, then, unless and until claim therefor shall have been made by a duly appointed guardian or other legal representative of such person, the Retirement Committee may provide for such payment or any part thereof to be made to any person or institution then contributing toward or providing for the care and maintenance of such person. Any such payment shall be a payment for such person and shall constitute a complete discharge of the liability of TVA therefor.
|
6.1
|
Funding. The Plan is intended as an unfunded plan of supplementary retirement benefits for selected employees of TVA. TVA may establish appropriate reserves for the Plan on its books of account in accordance with generally accepted accounting principles. TVA may set up a trust or trusts to manage these reserves. Such reserves shall be, for all purposes, part of the general assets of TVA, and no Participant, Beneficiary, or other person claiming a right under the Plan shall have any interest, right, or title to such reserves except as provided by the
|
6.2
|
Right to Amend, Suspend, or Terminate. TVA reserves the right at any time and from time to time to amend or terminate the Plan by action of the Board or its delegatee without the consent of any Participant, Beneficiary or other person. However, no such amendment may decrease a Participant's Accrued Benefit as of the time of such amendment. In the event of Plan termination, a Participant shall be entitled to receive his or her Accrued Benefit, determined as of the date of Plan termination, in the form and manner as set forth in the Plan as of the date of Plan termination. Plan amendments may be approved and implemented by the Retirement Committee except that the Board or its delegatee reserves the right to approve any Plan amendments which could change the amount of the benefits payable under the Plan.
|
6.3
|
Right to Benefit. No person shall have any right to a benefit under the Plan except as such benefit has become payable in accordance with the terms of the Plan, and such right shall be no greater than the rights of any unsecured general creditor of TVA. Notwithstanding any other provision of this Plan, if an employee shall be discharged for reasons of acts of fraud, dishonesty, larceny, misappropriation, or embezzlement committed against TVA, all of such employee's rights to benefits under this Plan shall be forfeited.
|
6.4
|
Administration of the Plan. Except as otherwise specifically provided in the Plan, the Retirement Committee shall be the administrator of the Plan. The Retirement Committee as plan administrator shall have full authority in its discretion to determine all questions arising in connection with the Plan, including the interpretation of the Plan, and may adopt Plan amendments (subject to section 6.2) and procedural rules and may rely on such legal counsel, actuaries, accountants, and agents as it may deem advisable to assist in the administration of the Plan. The Retirement Committee may establish such rules and procedures as it deems appropriate to carry out the intent and purpose of the Plan. Decisions of the Retirement Committee as plan administrator shall be conclusive and binding on all Participants and Beneficiaries. The Retirement Committee may delegate in writing to one or more persons any of its duties as plan administrator and may revoke in writing any such designation previously made.
|
6.5
|
Titles. The cover page of this Plan, the Table of Contents, and the titles of the sections herein are included for convenience of reference only and shall not be construed as part of this Plan or have any effect upon the meaning of the provisions hereof. Unless the context requires otherwise, the singular shall include the plural and the masculine shall include the feminine; such words as "herein," "hereafter," "hereof," and "hereunder" shall refer to this instrument as a whole and not merely to the subdivision in which such words appear.
|
6.6
|
Governing Law. TVA is a corporate agency and instrumentality of the United States, and this Plan shall be governed by and construed under Federal law. In the event Federal law does not provide a rule of decision for any matter or issue under the Plan, the law of the State of Tennessee shall apply; provided, however, in no event shall Tennessee’s choice of law provisions apply. The Plan and payment of Awards are intended to be interpreted, operated, and administered in a manner consistent with the short-term deferral exemption from Section 409A of the Internal Revenue Code and official guidance thereunder.
|
6.7
|
Separability. If any term or provision of this Plan as presently in effect or amended from time to time, or the application thereof to any payments or circumstances, shall to any extent be invalid or unenforceable, the remainder of the Plan, and the application of such term or provision to payments or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby, and each term or provision of the Plan shall be valid and enforced to the fullest extent permitted by law.
|
6.8
|
Authorized Officers. Whenever TVA under the terms of the Plan is permitted or required to do or to perform any act or matter or thing, it shall be done and performed by a duly authorized officer of TVA.
|
6.9
|
Certain Rights and Limitations. The establishment of the Plan shall not be construed as conferring any legal rights upon any employee or other person for a continuation of employment, nor shall it interfere with the rights of TVA to discharge any employee and to treat any employee without regard to the effect that such treatment might have upon that employee as a participant in the Plan.
|
6.10
|
Compliance with Section 409A. At all times, to the extent Internal Revenue Code Section 409A and its implementing regulations (collectively, "Section 409A") applies to amounts deferred under this Plan: (a) this Plan shall be operated in accordance with the requirements of Section 409A; (b) any action that may be taken (and, to the extent possible, any action actually taken) by the Board or its
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of the Tennessee Valley Authority;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
August 3, 2015
|
/s/ William D. Johnson
|
|
William D. Johnson
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of the Tennessee Valley Authority;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
August 3, 2015
|
/s/ John M. Thomas, III
|
|
John M. Thomas, III
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
|
|
/s/ William D. Johnson____________
|
William D. Johnson
|
President and Chief Executive Officer
(Principal Executive Officer)
|
August 3, 2015
|
|
|
/s/ John M. Thomas, III
|
John M. Thomas, III
|
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
August 3, 2015
|
|