S&P: Great River outlook positive

Standard & Poor's said it affirmed its BBB+ issuer credit rating on Great River Energy and the BBB+ underlying rating on its first mortgage bonds.

The outlook is positive.

The ratings reflect S&P's view that the utility's more than $230 million of unrestricted cash and investments at fiscal year-end 2008 provides a strong liquidity cushion equivalent to about five months' operating expenses.

Tempering Great River's strengths is its heavy dependence on coal-fired resources, which exposes it and its customers to potentially higher costs if carbon constraints are imposed, and the significant additional debt projected for capital needs, the agency said.

The positive outlook reflects the possibility of an upgrade if Great River can attain projected accrual and cash basis debt service coverage of at least 1.2 times as its sizable capital program proceeds, S&P said

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