Moody’s Investors Service in late July upgraded its investment grade credit rating to Baa1 for Silicon Valley Clean Energy, a California community choice aggregator.
Moody’s issuer rating is an independent assessment of SVCE’s financial strength over the long term and acknowledges the agency’s economic stability and diverse renewable energy portfolio, the CCA said.
“Receiving a higher credit rating from Moody’s is an additional sign that the Community Choice Energy model is strong and sound,” said George Tyson, SVCE Board Chair and Town of Los Altos Hills, Calif., Councilmember. “SVCE takes its financial responsibilities seriously so that we can reliably serve our customers and community with clean energy while maintaining stable rates and offering innovative services.”
The higher rating level is a result of SVCE having a positive financial outlook, including the agency’s strong liquidity, increased financial reserve targets, favorable rate forecasts, and its two clean energy project bonds, the CCA said.
Moody’s also acknowledged the effective management at SVCE to have withstood the challenges of a volatile power market and the COVID-19 pandemic.
Also taken into consideration was the expansion of SVCE’s diverse renewable energy portfolio and taking on new load in the form of innovative agreements, such as the carbon-free energy service with Google.
The benefits of a Baa1 rating include improved access to capital for energy supply contracts and the potential to negotiate lower energy prices, SVCE said.
Moody’s previously issued a Baa2 rating to SVCE in July 2020.
In June 2023, S&P Global Ratings affirmed its ‘A’ issuer credit rating for SVCE.
The American Public Power Association has initiated a new category of membership for community choice aggregation programs.