Moody’s cuts Georgia Power, ups Mississippi Power

Moody's Investors Service said it downgraded the ratings of Georgia Power Co., including its senior unsecured rating to Baa1 from A3, and placed the ratings on review for downgrade.

The agency affirmed the ratings of Southern Co., including its Baa2 senior unsecured rating and Prime-2 commercial paper rating. The outlook is negative.

Moody's also affirmed the ratings of Alabama Power Co., including its A1 issuer and senior unsecured ratings and its Prime-1 commercial paper rating. The outlook is negative.

The agency upgraded the ratings of Mississippi Power Co., including its senior unsecured rating to Baa3 from Ba1, and maintained a positive outlook.

Moody's affirmed the ratings of Alabama Power Capital Trust V, including its A2 preferred stock rating, and the ratings of Southern Electric Generating Co., including its A2 issuer rating and backed senior unsecured rating. The outlook for both entities is negative.

"The downgrade of Georgia Power is prompted by the $1.1 billion additional increase in the utility's share of Vogtle new nuclear project costs, which has materialized only 8 months after a revised cost estimate and construction schedule was reviewed and approved by state regulators, demonstrating the ongoing challenges and execution risk with the continued construction of the Vogtle project," Jeff Cassella, senior credit officer at Moody’s, said in a news release.

The upgrade of Mississippi Power reflects the relatively constructive outcome on its recent Performance Evaluation Plan filing, the resolution of the cost recovery uncertainty with the Kemper Integrated Gasification Combined Cycle plant behind them, and an expectation that financial metrics will improve and be sustained at levels that are stronger than the current rating, the agency said.

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