Newsroom Archive

Moody’s Affirms A3 Rating on AMP Meldahl Hydro Project Revenue Bonds

Published on: 09/06/2013

Moody’s Investors Service (Moody’s) has affirmed the ‘A3’ rating on the American Municipal Power, Inc. Meldahl Hydroelectric Project revenue bonds.

Moody’s says the rating outlook is stable, and stated in addition to the unconditional take-or-pay contract obligations of the 48 participants that one of the other factors which bears significant weight in the rating is the “51% obligation share of Hamilton,” which is the largest participant. Moody’s rating also considers the long-term value and economics of the “non-carbon hydroelectric project, as well as the A1 issuer rating assigned to AMP, Inc. who has been an effective power supply agency to its members.”

Moody’s also went on to note that the “… Meldahl project has the highest rated capacity factor of any of the new hydroelectric projects AMP is undertaking.”

In addition to the take-or-pay contracts and highest expected capacity factor as mentioned above, Moody’s also went on to point out several strengths of the project:

  • FERC license 50 year, renewable and non-carbon based
  • Power supply contract extensions by its members are a strong indication supporting AMP’s role as a regional power supplier
  • Favorable long-term cost projections
  • Competitive member retail rates, Hamilton being 30 percent below the neighboring IOU
  • AMP’s “…well regarded fiscal monitoring system including use of financial metrics to provide ongoing assessment of members’ credit profiles.”

View the Moody’s news release on the Financial Reports web page