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and federal, regional, and state regulations.
−Removed: Within the parameters of our risk policy, we generally utilize conventional first lien, exchange-traded, and over-the-counter traded derivative instruments and, in certain instances, structured products, to economically hedge the commodity price risk of the forecasted future sales and purchases of commodities associated with our generation portfolio.
+Added: Within the parameters of our risk policy, we generally utilize conventional exchange-traded, and over-the-counter traded derivative instruments and, in certain instances, structured products, to economically hedge the commodity price risk of the forecasted future sales and purchases of commodities associated with our generation portfolio.
Margin Sensitivities
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Actual price changes may differ by market and commodity, which could result in different results than displayed.
−Removed: The base case for these sensitivities incorporates market prices, our economic hedge position, expected Nuclear PTC, and expected generation (including cost inputs and planned outages) as of December 31, 2024 (Successor):
+Added: The base case for these sensitivities incorporates market prices, our economic hedge position, expected Nuclear PTC (to the extent applicable), and expected generation (including cost inputs and planned outages) as of December 31, 2025 (Successor):
Sensitivity Range 2026 Margin Effect (a)
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(a) Margin price sensitivities hold constant certain microeconomic and macroeconomic factors that may impact our margin and the impact of changes in prices;
−Removed: value in millions and includes expected value of Nuclear PTC.
+Added: value in millions, rounded to nearest $5 million, and includes expected value of Nuclear PTC.
(b) Power price sensitivities hold market heat rate constant for each month;
therefore, natural gas prices are adjusted accordingly.
−Removed: Interest Rate Risk
−Removed: We are exposed to interest rate risk from the possibility that changes in interest rates will affect future cash flows associated with existing floating rate debt issuances.
−Removed: To reduce interest rate risk, derivative instruments are utilized to economically hedge the interest rates for a predetermined contractual notional amount, which results in a cash settlement between counterparties.
−Removed: To the extent possible, first lien interest rate fixed-for-floating swaps are utilized to hedge this risk.
Form 10-K Table of Contents
−Removed: The following table displays the net fair value of interest rate swaps (including accrued interest, if applicable) outstanding at December 31, 2024 (Successor):
−Removed: Notional Exposure Asset (Liability) 10% Adverse Movement (a)
−Removed: Maturities Through
−Removed: Interest rate swaps $ 290 $ (2) $ 6 2026
+Added: Interest Rate Risk
+Added: Interest rate risk represents the risk that changes in benchmark interest rates could adversely affect our financial condition, results of operations, and cash flows.
+Added: We are exposed to interest rate risk as it relates to our long-term debt.
+Added: Generally, as interest rates rise, periodic cash interest payments due on the Company’s variable rate long term debt increases while lower interest rates decrease such payments.
+Added: Although the Company is provided with cash flow predictability because changes to benchmark interest rates do not affect the Company’s periodic cash fixed rate debt interest payments, this could result in the Company paying above prevailing market rates during periods of declining interest rates.
+Added: Accordingly, the fair value associated with the Company’s fixed rate debt generally increases as benchmark interest rates decline and decreases during periods of rising rates.
+Added: Within the parameters of our risk policy, a portion of our variable rate long-term debt is hedged through the use of financial derivative instruments that is intended to mitigate the variability of cash flows associated with the changes in benchmark rates.
+Added: Additionally, the Company proactively monitors market conditions which may result, at its election, accessing capital markets to refinance its long-term debt portfolio.
+Added: As of December 31, 2025 (Successor), the Company’s long term debt portfolio included approximately:
+Added: (i) $4.0 billion of fixed rate debt, (ii) $2.9 billion of variable rate debt, and (iii) $990 million of aggregate interest rate swap notional that hedges variable rate exposure through 2029.
+Added: The following table displays the estimated effect of a hypothetical 10% increase in benchmark interest rates:
+Added: Change to interest expense, net (a)
+Added: Change in fair value of long-term debt, net (b)
__________________
−Removed: (a) Effect of a 10% adverse interest rate movement decreases assets or increases liabilities, as applicable, which could result in an asset becoming a liability.
−Removed: Additionally, we are exposed to a potential increase in interest expense and to changes in the fair value of debt.
−Removed: The estimated impact of a 10% adverse movement in interest rates were:
−Removed: December 31, 2024 December 31, 2023
−Removed: Increase in interest expense $ 6 $ 6
−Removed: Fair value of debt 46 53
+Added: (a) Estimated increase of variable rate long-term debt interest expense over the next twelve months, net of interest rate swap settlement.
+Added: (b) Estimated decrease in the fair value of fixed rate long-term debt as of December 31, 2025 (Successor).
Credit risk is the risk of financial loss if a customer, counterparty, or financial institution is unable to perform or pay amounts due, causing a financial loss to us.
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Such allowances are presented as part of “Accounts receivable” on the Consolidated Balance Sheets.
−Removed: As of December 31, 2024 (Successor) and December 31, 2023 (Successor), there were no material credit impairments.
+Added: As of December 31, 2025 (Successor) and 2024 (Successor), there were no material credit impairments.
We maintain credit procedures with respect to counterparty credit (including requirements that counterparties maintain specified credit standards) and require other assurances in the form of credit support or collateral in certain circumstances in order to limit counterparty credit risk.
−Removed: However, we have concentrations of suppliers and customers among electric utilities, financial institutions, marketing and trading companies, and the U.S.
+Added: However, we have concentrations of suppliers and customers among financial institutions, ISOs, and marketing and trading companies.
These concentrations may impact our overall exposure to credit risk, positively or negatively, as counterparties may be similarly affected by changes in economic, regulatory, or other conditions.
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Investment Price Risk
−Removed: In accordance with certain NRC requirements, we maintain trust funds comprised of restricted assets that were established in order to fund our proportional share of Susquehanna's future decommissioning obligations.
+Added: In accordance with certain NRC requirements, we maintain trust funds comprised of restricted assets that were established in order to fund our proportionate share of Susquehanna's future decommissioning obligations.
As of December 31, 2025 (Successor), the NDT was invested primarily in domestic equity securities, fixed-rate, fixed-income securities, and short-term cash-equivalent securities and is presented as fair value on the Consolidated Balance Sheets.
−Removed: The mix of securities is intended to provide returns sufficient to fund our proportional share of Susquehanna's decommissioning and to compensate for inflationary increases in decommissioning costs.
+Added: The mix of securities is intended to provide returns sufficient to fund our proportionate share of Susquehanna's decommissioning and to compensate for inflationary increases in decommissioning costs.
However, the equity securities included in the NDT are exposed to price fluctuation in equity markets, and the values of fixed-rate, fixed-income securities are primarily exposed to changes in interest rates.
We actively monitor the investment performance and periodically review the asset allocation in accordance with our nuclear decommissioning trust investment policy statement.
−Removed: The following table shows the impact of a hypothetical 10% increase in interest rates and a 10% decrease in equity values:
−Removed: December 31, 2024 December 31, 2023
+Added: As of December 31, 2025 (Successor), the net estimated effect of a hypothetical 10% increase in interest rates and a 10% decrease in equity values was:
Estimated increase (decrease) in the fair value of NDT assets $ (117)
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.