Tennessee Valley Authority operating revenues increased 7 percent
The higher revenues were driven by electricity sales of 38.1 billion kilowatt-hours, a two percent increase in sales from the prior year, due to colder than normal weather in TVA's service territory during the quarter.
During November 2018, TVA recorded its second highest peak power demand ever for the month of November, at 26,714 megawatts at a systemwide average temperature of 24 degrees Fahrenheit.
In addition to managing the temperature volatility, TVA's system also provided high reliability through the highest annual rainfall recorded in 129 years of recordkeeping.
"TVA's diversified power system, and the employees who operate it, continued to demonstrate its value as we moved into the new fiscal year," said TVA President and CEO Bill Johnson.
"Our robust hydroelectric power fleet was able to take advantage of the excess rainfall to generate additional low cost energy that helped offset otherwise higher fuel expenses."
Fuel and purchased power expense was six percent higher than last year, primarily due to a $77 million increase in power purchased to meet increased demand.
Operating and maintenance expense for the quarter was up $99 million, or fifteen percent higher than last year, driven in part by an increase of $54 million related to accelerated recovery of certain regulatory assets, as well as an increase in planned nuclear outage days.
Net interest expense was down six percent for the quarter versus the same period in the prior year, reflecting a lower overall debt balance.
"Consistent execution of TVA's financial plan is helping TVA reduce debt," said TVA Chief Financial Officer John Thomas.
"And reducing debt will continue to have a positive impact on financial results and power rates in the future, just as we have seen so far this fiscal year."
Net income was $135 million higher for the quarter than in the prior year, reflecting higher operating income and lower net interest expense. ■