Add to balance / Manage account | User: | Log out |
Prospect News home > News index > List of issuers E > Headlines for Elwood Energy, LLC > News item |
Moody's might downgrade Elwood
Moody's Investors Service said it placed Elwood Energy LLC's Ba2 senior secured bond rating under review for possible downgrade.
The review considers the expected sale by Dominion Resources (Baa2/stable) of its 50% interest in Elwood to EquiPower Resources. The agency said it previously viewed Dominion's substantial ownership in Elwood to be materially credit supportive, especially given the affiliate relationships and Dominion's strong investment-grade profile.
If the sale is completed as expected, Moody's expects to downgrade Elwood's senior secured rating to Ba3 from Ba2. The agency said this Ba3 rating would reflect Elwood's weak competitiveness given its high heat rate and its reliance on PJM RTO capacity payments for nearly all of its cash flow.
That said, Elwood's credit quality remains supported by strong historical operational performance, Elwood's contracts on four units through August 2016/2017 and known capacity prices through May 2016 that should enable it to achieve an average of 2.2 times debt service coverage through 2016, Moody's added.
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.