Moody’s assigns Energy Harbor Baa3

Moody’s Investors Service said it assigned a first-time issuer rating of Baa3 to Energy Harbor Corp., an independent power producer operating in the Pennsylvania, Jersey, Maryland power market. The outlook is stable.

Energy Harbor, formerly known as FirstEnergy Solutions Corp., emerged from bankruptcy as a new company on Thursday.

The Baa3 rating reflects Energy Harbor’s stable cash flow generated from power sales and capacity revenue in PJM as well as the Clean Air Credit revenue for its nuclear power plants in Ohio. It also incorporates Energy Harbor’s very low leverage as it emerged out of bankruptcy with only $431 million of tax-exempt secured debt and Moody’s expectation the company’s leverage will remain low.

With about $1 billion of cash on hand at the time of the emergence, Energy Harbor maintains ample liquidity, which the agency said it would expect will be augmented with the addition of external revolving credit and/or letter of credit facilities going forward.

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