On September 23, 2013 Standard & Poor's Ratings Services (S&P) raised Vermont Electric Cooperative's (VEC) credit rating to 'A' and gave VEC a stable outlook. VEC’s rating prior to this upgrade was ‘A-’.
The improved credit rating reflects S&P's view that strong management practices at VEC and demonstrated leadership skills have helped to improve VEC’s reliability while controlling costs and electric rates.
‘This is great news for VEC’s members,’ said Dave Hallquist, VEC’s chief executive officer. ‘VEC’s board of directors and employees have worked hard during the past several years to improve our financial outlook. We’ve steadily moved from a ‘BBB’‘ in 2007 to an ‘A’ rating which indicates that we’re on strong financial ground. This will help VEC to further diversify our power portfolio at more competitive and stable costs while we continue to deliver safe and reliable electricity to our members.
In a press release S&P analyst Judith Waite referred specifically to ‘a combination of cost management, moderate growth, and regulatory support’ as factors contributing to this achievement. By keeping purchased power costs low and reducing operating costs, VEC has been able to control electric rates.
The S&P announcement comes on the heels of a VEC announcement last week that it would issue patronage capital distributions to its members for the first time in its 75 year history. Patronage capital is a unique feature of the cooperative business model and is based on the principle that the economic benefits of the cooperative’s operation should be returned to its members or reinvested in the co-op. Unlike shareholders of investor-owned utilities, a cooperative’s owners are its members (or consumers). VEC is issuing $850,000 to current and former VEC members.
Johnson, VT- VEC 9.25.2013 For more information www.vermontelectric.coop.