Moody’s upgrades Tenaska Georgia to Baa2

Moody's Investors Service said it upgraded the senior secured rating of Tenaska Georgia Partners, LP to Baa2 from Baa3.

The outlook is stable.

Moody’s said the upgrade reflects the consistently strong financial performance of Tenaska Georgia over an extended period of time. Tenaska Georgia has produced debt service coverage ratios (DSCRs) at or above 1.4 times in recent years, and the agency expects this to continue.

“The rating action also considers the strength of the project's long-term Power Purchase Agreement (PPA) with Exelon Generation Co., LLC (ExGen, Baa2 stable), where all of the fuel cost risk is borne by that offtaker,” Moody’s said.

“The PPA is a 29-year tolling agreement expiring June 1, 2030, whereby TGP makes all of the project's output available to ExGen. In return, ExGen pays TGP fixed capacity payments, designed to compensate TGP for fixed operating and maintenance costs and debt service payments, as well as delivered energy payments to cover variable operating costs.

“The PPA provides for stable cash flows over the life of the bonds.”

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