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Leases (Table Text Block)
 12 Months Ended
Sep. 30, 2024
Leases [Abstract]  
Amounts Recognized on Balance Sheets The following table provides information regarding the presentation of leases on the Consolidated Balance Sheets:
Amounts Recognized on TVA's Consolidated Balance Sheets
At September 30
(in millions)
20242023
Assets
  OperatingOperating lease assets, net of amortization$149 $177 
  FinanceFinance leases729 572 
Total lease assets$878 $749 
Liabilities
Current
  OperatingAccounts payable and accrued liabilities$63 $71 
  FinanceAccounts payable and accrued liabilities80 56 
Non-current
  OperatingOther long-term liabilities88 93 
  FinanceFinance lease liabilities700 576 
Total lease liabilities$931 $796 
Amounts Recognized on Statements of Cash Flows
The following table contains additional information with respect to cash and non-cash activities related to leases:
Amounts Recognized on TVA's Consolidated Statements of Cash Flows
For the years ended September 30
(in millions)
202420232022
Operating cash flows for operating leases$78 $77 $57 
Operating cash flows for finance leases37 43 42 
Financing cash flows for finance leases76 56 60 
Lease assets obtained in exchange for lease obligations (non-cash)
Operating leases$115 $84 $43 
Finance leases230 3 — 
Weighted Averages
TVA has certain finance leases under PPAs under which the present value of the minimum lease payments exceeds the fair value of the related lease asset at the date of measurement.  This resulted in an interest rate that was higher than TVA's incremental borrowing rate. The weighted average remaining lease terms in years and the weighted average discount rate for TVA's operating and finance leases were as follows:
Weighted Averages
At September 30
20242023
Weighted average remaining lease terms
Operating leases4 years3 years
   Finance leases(1)
9 years10 years
Weighted average discount rate(2)
Operating leases4.3%4.1%
Finance leases17.6%21.6%
Note
(1) One of TVA's finance leases includes an option period to extend, which TVA is reasonably certain to exercise.
(2) The discount rate is calculated using the rate implicit in a lease if it is readily determinable. If the rate used by the lessor is not readily determinable, TVA uses its incremental borrowing rate as permitted by accounting guidance. The incremental borrowing rate is influenced by TVA's credit rating and lease term and as such may differ for individual leases, embedded leases, or portfolios of leased assets.

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Future Minimum Lease Payments The following table presents maturities of lease liabilities and a reconciliation of the undiscounted cash flows to lease liabilities at September 30, 2024:
Future Minimum Lease Payments
Minimum payments outstanding at September 30, 2024
(in millions)
Operating leases
2025$68 
202634 
202731 
202818 
20294 
Thereafter8 
Minimum annual payments163 
Less: present value discount(12)
Operating present value of net minimum lease payments$151 
Finance leases
2025$140 
2026139 
2027137 
2028133 
2029132 
   Thereafter452 
Minimum annual payments1,133 
Less: amount representing interest(353)
Finance present value of net minimum lease payments$780 
Lease, Cost TVA's leases consist primarily of railcars, equipment, real estate/land, power generating facilities, and gas pipelines. TVA's leases have various terms and expiration dates remaining from less than one year to 22 years. The components of lease costs were as follows:
Lease Costs
For the years ended September 30
(in millions)
202420232022
Operating lease costs(1)
$77 $69 $56 
Variable lease costs(1)(5)
258 134 78 
Short-term lease costs(1)
10 18 26 
Finance lease costs
Amortization of lease assets(2)
79 57 58 
Interest on lease liabilities(3)(4)
37 43 42 
Total finance lease costs116 100 100 
     Total lease costs$461 $321 $260 

Notes
(1) Costs are included in Operating and maintenance expense, Fuel expense, Purchased power expense, and Tax equivalents expense on the Consolidated Statements of Operations.
(2) Expense is included in Depreciation and amortization expense on the Consolidated Statements of Operations.
(3) Expense is included in Interest expense on the Consolidated Statements of Operations.
(4) Certain finance leases receive regulatory accounting treatment and are reclassified to Fuel expense and Purchased power expense.
(5) Variable lease costs include costs related to variable payments that are based on energy production levels, which are allocated to expense based on the determination of lease and non-lease components associated with the underlying agreements.