Grant PUD bond rating upgraded amid strong finances, financial outlook
S&P Global Ratings has upgraded from AA to AA+ the credit rating of Grant PUD's electric system, citing strong, sustained finances and risk management.
"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.
Reasons for the upgrade include:
Extremely strong available reserves of $260 million as of
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.
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.
*Rating agencies and PUDs often calculate this ratio differently. Grant PUD doesn't include available cash in its calculation for a 59 percent debt-to-capitalization expected by year-end, toward an eventual ratio in the mid-50-percent range.
About Grant PUD: Established by local residents over 75 years ago, Grant PUD generates and delivers energy to millions of customers throughout the Pacific Northwest. For more information visit www.grantpud.org or follow us on Facebook and Twitter.