Fitch Publishes U.S. Transmission and Distribution Handbook

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has published its inaugural U.S. Transmission and Distribution Handbook providing detailed information for utility distribution companies (UDCs) in Fitch's universe. The UDC sector comprises electric transmission and distribution (T&D) utilities as well as natural gas local distribution companies (LDCs). Each company report includes rating rationales and rating drivers along with debt structures and financial summary information.

The UDC sector has typically enjoyed strong investment-grade ratings, due in large measure to lower operational risks than those faced by integrated utilities, ongoing regulatory support for investments in T&D infrastructure, and a rising proportion of investments regulated by the Federal Energy Regulatory Commission (FERC), which Fitch deems more supportive than state regimes.

However, the sector is not without challenges including stagnant sales growth prospects, elevated capex that is expected to bring upward pressure on customers' bills and declining returns on equity. The expiration of bonus depreciation is also likely to increase FFO-adjusted leverage toward the upper end of its historic range. While Fitch believes these headwinds are manageable, a significantly higher-than-expected acceleration in the appreciation of natural gas prices, interest rates and the general level of inflation could lead to weakening credit trends.

The report, which has detailed information for 40 UDC's is available on the Fitch web site at 'www.fitchratings.com'.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research: U.S. Transmission and Distribution Utilities Handbook (A Detailed Review of Electric and Gas T&D Utilities)

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=865196

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Fitch Ratings
Shalini Mahajan, +1-212-908-0351
Managing Director
Fitch Ratings, Inc.
33 Whitehall St.
New York, NY 10004
or
Julie Jiang, +1-212-908-0708
Director
or
Media Relations
Alyssa Castelli, New York, +1-212-908-0540
[email protected]
Elizabeth Fogerty, New York, +1-212-908-0526
[email protected]

Source: Fitch Ratings

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