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Risk Management Activities and Derivative Transactions Risk Management Activities and Derivative Transactions (Tables)
 12 Months Ended
Sep. 30, 2020
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 Accumulated Other Comprehensive Income (Loss)
For the years ended September 30
Derivatives in Cash Flow Hedging RelationshipObjective of Hedge TransactionAccounting for Derivative
Hedging Instrument		20202019
Currency swapsTo 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$(1)$(114)
Summary of Derivative Instruments That Receive Hedge Accounting Treatment (part 2)(1)
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income to Interest Expense
For the years ended September 30
Derivatives in Cash Flow Hedging Relationship20202019
Currency swaps$38 $(45)
Note
(1) There were no amounts excluded from effectiveness testing for any of the periods presented. Based on forecasted foreign currency exchange rates, TVA expects to reclassify approximately $27 million of gains from AOCI to Interest expense within the next 12 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(1)
For the years ended September 30
 
Derivative Type
Objective of Derivative(2)
Accounting for Derivative Instrument20202019
Interest rate swapsTo 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

Realized gains and losses are recognized in Interest expense when incurred during the settlement period and are presented in operating cash flow		$(97)$(79)
Commodity contract derivativesTo 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		(1)— 
Notes
(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 were no related gains (losses) recognized in income for these unrealized gains (losses) for the years ended September 30, 2020 and 2019.
(2) During the fourth quarter of 2020, TVA discontinued derivative accounting for forward coal contracts.
Fair Values of TVA Derivatives
Fair Values of TVA Derivatives
At September 30
 20202019
Derivatives That Receive Hedge Accounting Treatment:
 BalanceBalance Sheet PresentationBalanceBalance Sheet Presentation
Currency swaps    
£200 million Sterling
$(78)Accounts payable and accrued liabilities $(78)$(90)Accounts payable and accrued liabilities $(6); Other long-term liabilities $(84)
£250 million Sterling
(63)Accounts payable and accrued liabilities $(5); Other long-term liabilities $(58)(61)Accounts payable and accrued liabilities $(5); Other long-term liabilities $(56)
£150 million Sterling
(68)Accounts payable and accrued liabilities $(3); Other long-term liabilities $(65)(57)Accounts payable and accrued liabilities $(4); Other long-term liabilities $(53)
Derivatives That Do Not Receive Hedge Accounting Treatment:
 BalanceBalance Sheet PresentationBalanceBalance Sheet Presentation
Interest rate swaps    
$1.0 billion notional
$(1,449)Accounts payable and accrued liabilities $(43); Accrued interest $(37); Other long-term liabilities $(1,369)$(1,261)Accounts payable and
accrued liabilities $(29); Accrued interest $(33);
Other long-term liabilities
$(1,199)
$476 million notional
(588)Accounts payable and accrued liabilities $(22); Accrued interest $(10); Other long-term liabilities $(556)(498)Accounts payable and
accrued liabilities $(15); Accrued interest $(9);
Other long-term liabilities
$(474)
$42 million notional(4)Accounts payable and accrued liabilities $(2); Other long-term liabilities $(2)(5)Accounts payable and
accrued liabilities $(1); Accrued interest $(1); Other long-term liabilities $(3)
Commodity contract derivatives46 Other current assets $26; Other long-term assets $23; Accounts payable and accrued liabilities $(3)(41)Other current assets $12; Other long-term liabilities $(16); Accounts payable and accrued liabilities $(37)
Currency Swaps Outstanding TVA had the following currency swaps outstanding at September 30, 2020:
Currency Swaps Outstanding
September 30, 2020
Effective Date of Currency Swap ContractAssociated TVA Bond Issues Currency ExposureExpiration Date of SwapOverall Effective
Cost to TVA
1999£200 million20215.81%
2001£250 million20326.59%
2003£150 million20434.96%
Commodity Contract Derivatives
Commodity Contract Derivatives 
At September 30
 20202019
 
Number of Contracts
Notional AmountFair Value (MtM)Number of ContractsNotional Amount
Fair Value (MtM)
Coal contract derivatives—— million tons$— 89 million tons$(4)
Natural gas contract derivatives42302 million mmBtu$46 65330 million mmBtu$(37)
Offsetting Assets and Liabilities The amounts of TVA's derivative instruments as reported on the Consolidated Balance Sheets at September 30, 2020 and 2019, are shown in the table below.
Derivative Assets and Liabilities(1)
(in millions)
At September 30, 2020
At September 30, 2019
Assets
Commodity derivatives not subject to master netting or similar arrangement$49 $12 
Liabilities
Currency swaps(2)
$209 $208 
Interest rate swaps(2)
2,041 1,764 
Total derivatives subject to master netting or similar arrangement2,250 1,972 
Commodity derivatives not subject to master netting or similar arrangement3 53 
Total liabilities$2,253 $2,025 
Notes
(1) Offsetting 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. There were no offsetting amounts on TVA's Consolidated Balance Sheets at either September 30, 2020 or 2019.
(2) Letters of credit of approximately $1.5 billion and $1.3 billion were posted as collateral at September 30, 2020 and 2019, 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.