Bonds and Financing

Rating agencies deliver positive news for Washington State PUDs

Washington State’s Chelan County PUD and Snohomish County PUD received positive news from rating agencies S&P Global and Moody’s Investors Service.

S&P Global continues to rate Chelan County PUD among the top customer-owned utilities in the U.S., while Snohomish County PUD’s electric and generation system revenue bond ratings were recently upgraded to Aa2 by Moody’s. 


At a meeting of the Chelan County PUD commissioners on June 3, PUD Lead Treasury Analyst Heather Irelan said S&P called out several “extremely strong” financial positions including a debt ratio of 34 percent and electric rates that are among the lowest in the nation.

PUD Treasurer Debbie Litchfield thanked customer-owners, commissioners and PUD staff for supporting strategic priorities that resulted in the continued high bond ratings. The PUD has cut its debt in half since 2010.

“The District has been working hard to achieve this level that puts us among the most highly-rated public utilities by S&P and Fitch,” Litchfield said.

High bond ratings ultimately keep rates lower for customer-owners. They also could bring lower interest rates if the PUD moves ahead on borrowing money to invest in its valuable hydropower and grid assets in the next few years, she added.

Board President Garry Arseneault said the review and rating by a third party gives customer-owners added confidence in the strength of PUD finances.

S&P Global confirmed the AA+ stable rating for Chelan, which also has high bond ratings of AA+ stable from Fitch Ratings and Aa3 stable from Moody’s.

Snohomish County PUD

According to Moody’s, Snohomish County PUD’s rating was upgraded from Aa3 to Aa2 due to the region’s robust economic growth and the utility’s continued strong financial performance.

“This rating upgrade is a result of the PUD’s continued emphasis on fiscal responsibility and cost management,” said Glenn McPherson, PUD Chief Financial Officer. “This is great news and the result of a lot of hard work by employees at the PUD and steady policy guidance from our Board of Commissioners.”

Moody’s upgraded bond rating, together with the PUD’s already strong AA- ratings with Standard & Poor’s and Fitch Ratings, will help the utility secure lower interest rates when it sells bonds to raise capital for future projects, Snohomish noted.

Moody’s cited several key factors for Snohomish PUD’s upgraded bond rating in its report, including:

  • Strong financial performance and liquidity
  • Decline in outstanding debt
  • Benefits of a long-term supply agreement with the Bonneville Power Administration
  • Low carbon transition risk exposure

Snohomish said that the region’s population and economic growth over the past five years also helped strengthen the PUD’s financial performance.

Snohomish County’s median family income is 127% of the U.S. average, unemployment is around 4%, and population increased more than 12% from 2013 to 2018 to 814,000.

Earlier this year, the PUD deferred a general rate increase based on stronger than expected financial results in 2018 and internal cost-control measures.

The PUD’s manageable capital plan for transmission and distribution system improvements like replacing aging poles and building new substations was also a factor in the bond-rating upgrade, it noted.