Bangkok--15 Mar--Standard & Poor's
Standard & Poor's Ratings Services has updated its assessment of several U.S. utility regulatory jurisdictions, according to the article published today on RatingsDirect titled "Standard & Poor's Updates Its U.S. Utility Regulatory Assessments."
In Standard & Poor's commentary "Assessing U.S. Utility Regulatory Environments," (re-published March 11, 2010), we discussed our views on what constitutes a credit-supportive regulatory climate. We then used those factors to create assessments of the regulatory environments in states that regulate the electric and gas utilities that we rate. We based the assessments of relevant jurisdictions on quantitative and qualitative factors, focusing on four main categories: the basic regulatory paradigm employed in the jurisdiction, ratemaking procedures, political influence, and financial stability.
We lowered Florida to "Credit-Supportive" from "More Credit-Supportive" to incorporate our opinion regarding what we view to be a higher degree of political influence in more recent regulatory decisions. Connecticut was lowered to "Less Credit-Supportive" from "Credit-Supportive" in response to a series of apparently precedent-setting rate case decisions that, in our opinion, may make it more difficult for utilities to earn a reasonable return. Hawaii was lowered to "Less Credit-Supportive" from "Credit-Supportive" because of worsening regulatory lag and uncertainties we see regarding the realization of the Clean Energy Initiative's goals given the time it is taking to issue key decisions.
We raised Oklahoma to "Credit-Supportive" from "Less Credit-Supportive" based on our assessment of the addition of several new ratemaking mechanisms now used in the state that we believe will significantly enhance rate timeliness and cost recovery. Illinois was raised to "Less Credit-Supportive" from "Least Credit-Supportive" based on what we view as a return to stability in the legislative and regulatory environment after the disruption experienced during the state's transition to competition. We raised Maryland to "Less Credit-Supportive" from "Least Credit-Supportive" for the same reason and what we see as an increased use of credit-friendly rate mechanisms such as decoupling and other adjustment clauses.
The reports are available to RatingsDirect on the Global Credit Portal subscribers at www.globalcreditportal.com and RatingsDirect subscribers at www.ratingsdirect.com. If you are not a RatingsDirect subscriber, you may purchase copies of these reports by calling (1) 212-438-7280 or sending an e-mail to
[email protected]. Ratings information can also be found on Standard & Poor's public Web site by using the Ratings search box located in the left column at www.standardandpoors.com. Members of the media may request copies of these reports by contacting the media representative provided.
Media Contact:
Mimi Barker, New York (1) 212.438.5054,
[email protected]
Analyst Contacts:
Todd A Shipman, CFA, New York (1) 212-438-7676
Key Contacts:
Americas Media Relations: (1) 212-438-6667
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Americas Customer Service: (1) 212-438-7280
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