BWL bond rating affirmed by Moody’s Investors Service
The Lansing Board of Water & Light has again received an excellent bond rating from the respected rating agency, Moody’s Investor Service.
Moody’s affirmed the BWL’s Aa3 rating. The BWL has maintained the Aa3 rating throughout one of the nation’s worst economic recessions on record.
“The BWL has risen to the fiscal challenges of the recession,” said BWL General Manager J. Peter Lark. “Moody’s rating is proof-positive that the company’s financial health is sound, and that we are well-positioned for growth as Michigan’s economy gradually rebounds.”
The rating of Aa3 by Moody’s is considered excellent by industry standards. In summarizing that rating, Moody’s cited the BWL’s competitive rates compared to investor-owned utilities; an economically stable area which the BWL serves; the company’s stable cash position, and above average debt service coverage.
Moody’s report also noted that the BWL’s plans to build a new cogeneration facility is a first step in replacing an aging infrastructure, while retaining its tradition of having a low-cost power source.
In July 2010, the BWL announced plans to build a natural gas-fired facility in Lansing’s Reo Town. The cogeneration plant will produce both electricity and steam to serve customers.
The $182 million facility will be paid for by the issuance of 28-year bonds.
Bond ratings such as Moody’s are independent assessments of the relative credit risk associated with purchasing and holding a particular bond, and the likelihood that the obligation will be repaid on time and in full.
The BWL is Michigan’s largest public utility, and one of Michigan’s oldest. In 2010, the BWL celebrated its 125th anniversary of service to Greater Lansing.
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