S&P lowers Panda Temple II

Standard & Poor's said it lowered the rating on Panda Temple II Power LLC to B- from B. The outlook is stable.

The recovery rating on this debt remains 3, indicating S&P’s expectation of meaningful (50% to 70%; lower end of the range) recovery in the event of default.

“The downgrade stems from continued weak market conditions in Electric Reliability Council of Texas,” S&P credit analyst Michael Ferguson said in a news release.

As a consequence of weaker-than-expected growth in demand, persistently low gas prices and significant renewable production, power prices and spark spreads have collapsed for merchant generators during the past 18 months. S&P anticipates that the volatility will continue through at least the end of 2017.

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