XML 93 R38.htm IDEA: XBRL DOCUMENT
v2.4.0.8

Risk Management Activities and Derivative Transactions (Tables) | 9 Months Ended
--- | ---
Jun. 30, 2014
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Summary of Derivative Instruments That Receive Hedge Accounting Treatment | The following tables summarize the accounting treatment that certain of TVA's financial derivative transactions receive:
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 |  | 2014 |  | 2013 |  | 2014 |  | 2013 |
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 |  | $ | 1 |  |  | $ | 9 |  |  | $ | 23 |  |  | $ | (7 | ) |
Summary of Derivative Instruments That Receive Hedge Accounting Treatment (part 2) Amount of Gain (Loss) Reclassified from OCI to Interest Expense
|  | Three Months Ended June 30 |  | Nine Months Ended June 30 |
Derivatives in Cash Flow Hedging Relationship |  | 2014 |  | 2013 |  | 2014 |  | 2013 |
Currency swaps |  | $ | 26 |  |  | $ | 1 |  |  | $ | 55 |  |  | $ | (57 | ) |
Note There were no ineffective portions or amounts excluded from effectiveness testing for any of the periods presented. Based on forecasted foreign currency exchange rates, TVA expects to reclassify approximately $30 million of losses from AOCI to interest expense within the next twelve months to offset amounts anticipated to be recorded in interest expense related to exchange gain on the debt.
Summary of Derivative Instruments That Do Not Receive Hedge Accounting Treatment |
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 |  | 2014 |  | 2013 |  | 2014 |  | 2013 |
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. |  | — |  |  | (2 | ) |  | — |  |  | (2 | ) |
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. |  | (6 | ) | — |  | (21 | ) |  | (29 | ) |  | (99 | ) |
Note (1) All of TVA's derivative instruments that do not receive hedge accounting treatment have unrealized gains (losses) that would otherwise be recognized in income but instead are deferred as regulatory assets and liabilities. As such, there was no related gain (loss) recognized in income for these unrealized gains (losses) for the three months and nine months ended June 30, 2014 and 2013.
Mark-to-Market Value of TVA Derivatives |
Mark-to-Market Values of TVA Derivatives
| At June 30, 2014 |  | At September 30, 2013
Derivatives that Receive Hedge Accounting Treatment
| Balance |  | Balance Sheet Presentation |  | Balance |  | Balance Sheet Presentation
Currency swaps |  |  |  |  |  |  |
£200 million Sterling | $ | (2 | ) |  | Other long-term liabilities |  | $ | (15 | ) |  | Other long-term liabilities
£250 million Sterling | 64 |  |  | Other long-term assets |  | 51 |  |  | Other long-term assets
£150 million Sterling | 7 |  |  | Other long-term assets |  | 10 |  |  | Other long-term assets
Derivatives that Do Not Receive Hedge Accounting Treatment
| Balance |  | Balance Sheet Presentation |  | Balance |  | Balance Sheet Presentation
Interest rate swaps |  |  |  |  |  |  |
$1.0 billion notional | (946 | ) |  | Other long-term liabilities |  | (886 | ) |  | Other long-term liabilities
$476 million notional | (331 | ) |  | Other long-term liabilities |  | (300 | ) |  | Other long-term liabilities
$42 million notional | (12 | ) |  | Other long-term liabilities |  | (13 | ) |  | Other long-term liabilities
Commodity contract derivatives | (150 | ) |  | Other long-term assets $2; Other current assets $3; Other long-term liabilities $(54); Accounts payable and accrued liabilities $(101) |  | (141 | ) |  | Other long-term assets $1; Other current assets $2; Other long-term liabilities $(35); Accounts payable and accrued liabilities $(109)
Derivatives under FTP(1) | (90 | ) |  | Other current assets $(56); Other long-term liabilities $(18); Accounts payable and accrued liabilities $(16) |  | (166 | ) |  | Other current assets $(97); Other long-term liabilities $(36); Accounts payable and accrued liabilities $(33)
Note (1) Fair values of certain derivatives under the FTP that were in net liability positions totaling $57 million and $100 million at June 30, 2014 and September 30, 2013, respectively, are recorded in TVA's margin cash accounts in Other current assets. These derivatives are transacted with futures commission merchants, and cash deposits have been posted to the margin cash accounts held with each futures commission merchant to offset the net liability positions in full.
Currency Swaps Outstanding | TVA had the following currency swaps outstanding as of June 30, 2014:
Currency Swaps Outstanding At June 30, 2014
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 |
Commodity Contract Derivatives
| At June 30, 2014 |  | At September 30, 2013
| Number of Contracts |  | Notional Amount |  | Fair Value (MtM) |  | Number of Contracts |  | Notional Amount |  | Fair Value (MtM)
Coal contract derivatives | 34 |  | 47 million tons |  | $ | (146 | ) |  | 19 |  | 43 million tons |  | $ | (140 | )
Natural gas contract derivatives | 33 |  | 63 million mmBtu |  | $ | (4 | ) |  | 13 |  | 39 million mmBtu |  | $ | (1 | )
Derivatives Under Financial Trading Program |
Derivatives Under Financial Trading Program
| At June 30, 2014 |  | At September 30, 2013
| Notional Amount |  | Fair Value (MtM) (in millions) |  | Notional Amount |  | Fair Value (MtM) (in millions)
Natural gas (in mmBtu) |  |  |  |  |  |  |
Futures contracts | — |  |  | $ | — |  |  | — |  |  | $ | — |
Swap contracts | 117,575,000 |  |  | (91 | ) |  | 152,922,500 |  |  | (169 | )
Option contracts | — |  |  | — |  |  | — |  |  | — |
Natural gas financial positions | 117,575,000 |  |  | $ | (91 | ) |  | 152,922,500 |  |  | $ | (169 | )
Fuel oil/crude oil (in barrels) |  |  |  |  |  |  |  |  |
Futures contracts | — |  |  | $ | — |  |  | — |  |  | $ | — |
Swap contracts | — |  |  | 1 |  |  | 1,205,000 |  |  | 3 |
Option contracts | — |  |  | — |  |  | — |  |  | — |
Fuel oil/crude oil financial positions | — |  |  | $ | 1 |  |  | 1,205,000 |  |  | $ | 3 |
Note Fair value amounts presented are based on net commodity position with the futures commission merchant or other counterparty. Notional amounts disclosed represent the net absolute value of contractual amounts.
FTP Unrealized Gains (Losses) | Unrealized gains and losses related to the FTP at June 30, 2014 and September 30, 2013 were as follows:
Financial Trading Program Unrealized Gains (Losses)
FTP unrealized gains (losses) deferred as regulatory liabilities (assets) |  | At June 30, 2014 |  | At September 30, 2013
Natural gas |  | $ | (91 | ) |  | $ | (169 | )
Fuel oil/crude oil |  | 1 |  |  | 3 |
FTP Realized Gains (Losses) | Realized gains and losses related to the FTP for the three and nine months ended June 30, 2014 and 2013 were as follows:
Financial Trading Program Realized Gains (Losses)
|  | For the Three Months Ended June 30 |  | For the Nine Months Ended June 30 |
Decrease (increase) in fuel expense |  | 2014 |  | 2013 |  | 2014 |  | 2013 |
Natural gas |  | $ | (5 | ) |  | $ | (13 | ) |  | $ | (23 | ) |  | $ | (60 | ) |
Fuel oil/crude oil |  | — |  |  | — |  |  | 2 |  |  | 2 |  |
Coal |  | — |  |  | — |  |  | — |  |  | (1 | ) |
Financial Trading Program Realized Gains (Losses)
|  | For the Three Months Ended June 30 |  | For the Nine Months Ended June 30 |
Decrease (increase) in purchased power expense |  | 2014 |  | 2013 |  | 2014 |  | 2013 |
Natural gas |  | $ | (1 | ) |  | $ | (8 | ) |  | $ | (9 | ) |  | $ | (40 | ) |
Offsetting Assets and Liabilities [Table Text Block] | The amounts of TVA's derivative instruments as reported in the Consolidated Balance Sheets as of June 30, 2014, and September 30, 2013, are shown in the table below.
| As of June 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 swaps | $ | 71 |  |  | $ | (56 | ) |  | $ | 15 |
Commodity derivatives under FTP | 56 |  |  | (55 | ) |  | 1 |
Total derivatives subject to master netting or similar arrangement | 127 |  |  | (111 | ) |  | 16 |
Total derivatives not subject to master netting or similar arrangement | 5 |  |  | — |  |  | 5 |
Total | $ | 132 |  |  | $ | (111 | ) |  | $ | 21 |
Liabilities |  |  |  |  |
Currency swap (3) | $ | (2 | ) |  | $ | — |  |  | $ | (2 | )
Interest rate swaps (3) | (1,289 | ) |  | — |  |  | (1,289 | )
Commodity derivatives under FTP | (146 | ) |  | 112 |  |  | (34 | )
Total derivatives subject to master netting or similar arrangement | (1,437 | ) |  | 112 |  |  | (1,325 | )
Total derivatives not subject to master netting or similar arrangement | (155 | ) |  | — |  |  | (155 | )
Total | $ | (1,592 | ) |  | $ | 112 |  |  | $ | (1,480 | )
| As of September 30, 2013
| 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 swaps | $ | 61 |  |  | $ | (33 | ) |  | $ | 28 |
Commodity derivatives under FTP | 101 |  |  | (98 | ) |  | 3 |
Total derivatives subject to master netting or similar arrangement | 162 |  |  | (131 | ) |  | 31 |
Total derivatives not subject to master netting or similar arrangement | 3 |  |  | — |  |  | 3 |
Total | $ | 165 |  |  | $ | (131 | ) |  | $ | 34 |
Liabilities |  |  |  |  |
Currency swap (3) | $ | (15 | ) |  | $ | — |  |  | $ | (15 | )
Interest rate swaps (3) | (1,199 | ) |  | — |  |  | (1,199 | )
Commodity derivatives under FTP | (267 | ) |  | 198 |  |  | (69 | )
Total derivatives subject to master netting or similar arrangement | (1,481 | ) |  | 198 |  |  | (1,283 | )
Total derivatives not subject to master netting or similar arrangement | (144 | ) |  | — |  |  | (144 | )
Total | $ | (1,625 | ) |  | $ | 198 |  |  | $ | (1,427 | )
Notes (1) Amounts primarily include counterparty netting of derivative contracts, margin account deposits for futures commission merchants transactions, and cash collateral received or paid in accordance with the accounting guidance for derivatives and hedging transactions. (2) There are no derivative contracts subject to a master netting arrangement or similar agreement which are not offset in the balance sheets. (3) Letters of credit of approximately $900 million and $800 million were posted as collateral at June 30, 2014 and September 30, 2013, respectively, to partially secure the liability positions of one of the currency swaps and one of the interest rate swaps in accordance with the collateral requirements for these derivatives.

X
- Definition Table showing the effective date, associated currency exposure, expiration date, and overall effective cost of the outstanding currency swaps. + References No definition available. + Details
Name: | tve_CurrencySwapsOutstandingTableTextBlock
Namespace Prefix: | tve_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition FTP Realized Gains (Losses) [Table Text Block] + References No definition available. + Details
Name: | tve_FTPRealizedGainsLossesTableTextBlock
Namespace Prefix: | tve_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition FTP Unrealized Gains (Losses) [Table Text Block] + References No definition available. + Details
Name: | tve_FtpUnrealizedGainsLossesTableTextBlock
Namespace Prefix: | tve_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition [Table Text Block] for Disclosure of information about derivative and financial assets and liabilities that are subject to offsetting, including enforceable master netting arrangements. + References No definition available. + Details
Name: | tve_OffsettingAssetsandLiabilitiesTableTextBlock
Namespace Prefix: | tve_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of pertinent information about derivatives under the Financial Trading Program. Includes a combination of the type of instrument, notional amount, related hedged item, and fair value. + References No definition available. + Details
Name: | tve_ScheduleOfDerivativesUnderFinancialTradingProgramTableTextBlock
Namespace Prefix: | tve_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19207-110258 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 10 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=35750535&loc=d3e13433-108611 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=35750535&loc=d3e13467-108611 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=35750535&loc=d3e13476-108611 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 30 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 45 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6447952&loc=d3e13220-108610 + Details
Name: | us-gaap_FairValueByBalanceSheetGroupingTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the effective portion of the gains and losses on derivative instruments designated (and non-derivative instruments) designated and qualifying in cash flow hedges and net investment hedges that was recognized in other comprehensive income (loss) during the current period. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4C -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=35706170&loc=SL5624171-113959 + Details
Name: | us-gaap_ScheduleOfDerivativeInstrumentsEffectOnOtherComprehensiveIncomeLossTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the location and amount of derivative instruments and nonderivative instruments designated as hedging instruments reported before netting adjustments, and the amount of gain (loss) on derivative instruments and nonderivative instruments designated and qualified as hedging instruments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4A -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=35706170&loc=SL5618551-113959 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4C -URI http://asc.fasb.org/extlink&oid=35706170&loc=SL5624171-113959 + Details
Name: | us-gaap_ScheduleOfDerivativeInstrumentsGainLossInStatementOfFinancialPerformanceTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 8 -URI http://asc.fasb.org/extlink&oid=35706170&loc=d3e41678-113959 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 25 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6886632&loc=d3e76258-113986 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=35706170&loc=d3e41620-113959 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1A -URI http://asc.fasb.org/extlink&oid=35706170&loc=SL5579245-113959 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1B -URI http://asc.fasb.org/extlink&oid=35706170&loc=SL5580258-113959 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=35706170&loc=SL5579240-113959 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=35706170&loc=d3e41641-113959 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=35706170&loc=d3e41638-113959 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4C -URI http://asc.fasb.org/extlink&oid=35706170&loc=SL5624171-113959 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4B -URI http://asc.fasb.org/extlink&oid=35706170&loc=SL5624163-113959 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(n)(2)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 + Details
Name: | us-gaap_ScheduleOfDerivativeInstrumentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration