Bangkok--27 Jan--Standard & Poor's
Standard & Poor's Ratings Services assigned its 'A-' rating to Southeast Alaska Power Agency's $16.83 million electric revenue refunding bonds, series 2009. The outlook is stable.
"The rating reflects the agency's firm wholesale power rate of 6.8 cents per kilowatt-hour, which has been stable for several years, intentionally designed to produce strong debt service coverage ratios substantially above 1.0x to fund renewal and replacement needs and avoid additional bonding, and to perhaps prepay the series 2009 bonds early," said Standard & Poor's credit analyst Paul Dyson. "There is also full rate autonomy at both the agency and member level, and very low rates at the member utility level, offering substantial financial flexibility to cover increased operating expenses such as power costs, supplemented by fuel cost adjustment mechanisms in place at two of the smallest member utilities."
The bonds will refund the agency's outstanding series 2004A and B electric revenue refunding bonds, which were used to refund an earlier loan from the state to acquire four hydroelectric projects, certain transmission lines, and related facilities in 2002.
The agency was formed in 2000 to purchase generating and transmission lines from the Alaska Energy Authority. Its structure initially included three member cities (Ketchikan, Wrangell, and Petersburg) and two electric cooperatives (Kodiak Electric Association and Copper Valley Electric Association) that were served by four separate large hydroelectric projects (Swan Lake serving Ketchikan, Tyee Lake serving Wrangell and Petersburg, Terror Lake serving Kodiak, and Solomon Gulch serving Copper Valley). Once the 2009 bonds are issued, the two cooperative members will resign their membership, and the hydro projects and transmission facilities serving them will be transferred to them.
Complete ratings information is available to subscribers of RatingsDirect, the real-time Web-based source for Standard & Poor's credit ratings, research, and risk analysis, at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com; select your preferred country or region, then Ratings in the left navigation bar, followed by Find a Rating.
Media Contact:
Edward Sweeney, New York (1) 212-438-6643, [email protected]
Analyst Contacts:
Paul Dyson, San Francisco (1) 415-371-5079
Ian Carroll, San Francisco (1) 415-371-5060
Key Contacts:
Americas Media Relations: (1) 212-438-6667
media_ [email protected]
Americas Customer Service: (1) 212-438-7280
[email protected]