Credit rating boosted for Grant PUD
Citing strong, sustained finances and risk management, S&P Global Ratings has upgraded the credit rating of Grant PUD’s electric system from AA to AA+, according to a press release.
“The rating action reflects our view of the district’s maintenance of extremely strong financial and operating metrics over several years and the credit strengths provided by its core generating assets whose production costs are among the lowest in the nation,” company officials announced June 27, according to a press release.
Reasons for the upgrade include:
• Extremely strong available reserves of $260 million as of fiscal year 2018.
• Very strong debt-to-capitalization ratio — total debt as a percentage of total assets — of 54 percent as of 2018 by S&P’s calculation.
• Forward power sales (slice) contracts that eliminate “water risk” by ensuring Grant PUD receives stable, predictable revenue from its surplus power sales.
• A diverse mix of industrial customers, including data centers and manufacturing, with strong load growth expected into the future.
• A commission willing to raise rates when necessary.
The electric system comprises poles, wires, transformers, substations and other equipment needed to transport and sell electricity to the homes and business in Grant County.
Grant PUD’s Power Production business, comprising Priest Rapids and Wanapum dams on the Columbia River, earned a confirmed AA-stable rating. Strengths cited included very low production costs, continued successful upgrades of dam machinery, compliance with environmental regulations, generally solid operational performance and continued adequate financial performance, according to a press release.