Fitch Ratings assigned the Indiana Municipal Power Agency's approximately $427 million power supply system refunding revenue bonds, 2026 series A an “A+” rating.
Bond proceeds will be used to refund series 2016A & C bonds for savings and to pay costs of issuance, Fitch said.
In addition, Fitch affirmed IMPA's IDR and ratings as detailed in a late April Rating Action Commentary.
The Rating Outlook is Stable.
“We work hard to maintain our strong credit ratings and appreciate our members’ support,” said Jack Alvey, President and CEO of IMPA.
“There was strong demand for the bonds bringing $46.2 million and 10.54% present value savings for our members helping to reduce costs which is a key part of our mission,” he said.
In detailing key rating drivers, Fitch noted the following:
Revenue Defensibility (“aa”)
“IMPA's 'Very Strong' revenue defensibility is supported by the revenue framework of long-term, take-and-pay PSCs with its members, the 'Strong/'Midrange' credit quality of IMPA's largest five members that account for around 46% of revenues, and solid rate flexibility,” Fitch noted.
Operating Risk (“a”)
“IMPA's low operating cost burden and diverse resource mix, both in number of units and fuel type, underpin the low operating risk assessment,” Fitch said.
Power requirements are met through a mix of partial ownership interests in several power plants, purchased power arrangements and member-owned generating facilities, totaling over 1,000 MW used to meet member needs. Coal-fired resources provide 40% of total capacity and provided 53% of energy in 2025. Fitch said it expects coal generation will remain integral to the agency's portfolio given its ownership shares in newer vintage coal units.
“IMPA has continued to invest in its system, including the addition of new baseload capacity, which has led to a low average age of plant and manageable capital needs. Operating costs are expected to remain low and operating cost flexibility is considered neutral,” Fitch said.
Financial Profile (“a”)
IMPA's strong financial profile remained solid in 2025, with improved leverage, measured as net adjusted debt to funds available for debt service (FADS) and robust liquidity levels over the past five years, the rating agency noted.
IMPA's capital plan, which includes the construction of a new 250-MW combustion turbine expansion project, “remains manageable and management anticipates stable member sales and revenues over the near term, which should lead to stable financial metrics including leverage, COFO, and liquidity that are expected to remain neutral to the financial profile assessment.”
