CHICAGO — Moody's Investors Service has revised its outlook on Central Minnesota Municipal Power Agency's A3 rating to positive from stable as the agency makes progress on a high voltage transmission line project and its members have seen improved credit quality.
The Dec. 4 action affects $32.7 million of debt. The rating reflects sound bondholder security provisions including the take-or-pay contracts with local public utility members with an average rating of A2, recently up from A3.
The rating also reflects the strong Federal Energy Regulatory Commission full cost recovery regulatory order, the on time and on budget construction status of a new transmission line, and minor operational risk.
The high voltage transmission line will bring wind energy into the market from North Dakota and is considered an important part of the region's transmission strategy. The line is 84% completed resulting in the agency's improved outlook.