Fitch Takes Rating Action on Transmission Projects; Applies Revised Criteria

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has taken rating actions on a global portfolio of high-voltage transmission project financings following the recent publication of its revised 'Rating Criteria for Availability-Based Projects' on Oct. 14, 2015. Fitch's review covers projects located in the United States, Europe and Latin America.

The rating actions taken include five upgrades and five affirmations based on Fitch's assessment of cost risk, realistic outside cost stresses, indicative debt service coverage ratio (DSCR) thresholds, and breakeven cost analysis.

The rating of SteelRiver Transmission Company LLC was placed on Rating Watch Positive pending updated performance information from the issuer. Fitch's criteria review did not change the rating of Linhas de Taubate Transmissora de Energia S.A., a Brazilian transmission project, though the rating was recently placed on Rating Watch Negative for unrelated reasons. Also, Fitch did not take rating action on Abengoa Transmision Sur S.A. (ATS) due to the filing for insolvency protection of Abengoa, S.A. Fitch intends to take rating action on ATS after evaluating the implications of both the filing and the project's cost risk assessment under the revised criteria. Fitch anticipates completing this process shortly.

The rating actions apply to both publicly- and privately-rated project financings of single asset high-voltage transmission lines. Under the new criteria, Fitch evaluates an overall cost risk assessment utilizing three sub-factors: scope risk, cost predictability and cost volatility/structural protections.

Fitch assigned an overall score of 'Stronger' to several of the projects due to their low complexity, limited lifecycle exposure, predictable and established performance history, substantial pass-through of all costs to a creditworthy counterparty, and stable regulatory framework. Fitch upgraded five projects primarily due to strong rating case DSCRs and high breakeven metrics relative to their cost risk assessment. The majority of the projects received 'Midrange' assessments for cost risk, cost predictability, and cost volatility/structural protections.

Certain ratings were constrained based on Fitch's break-even cost analysis, counterparty credit quality or exposure to revenue risks, notwithstanding other favorable indicators of financial performance.

Additional information is available at 'www.fitchratings.com'.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20151202006090/en/

Fitch Ratinga
Christopher Joassin
Director
+1-312-368-3166
Fitch Ratings, Inc.
70 W. Madison St.
Chicago, IL 60602
or
Scott Zuchorski
Senior Director
+1-212-908-0659
or
Media Relations
Sandro Scenga, New York, +1-212-908-0278
[email protected]

Source: Fitch Ratings

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