FOR IMMEDIATE RELEASE
August 26, 2020
Jenna Famular | Communications Manager
(925) 378-6747 | communications@mceCleanEnergy.org
MCE Earns New, Higher ‘Investment-Grade’ Credit Ratingfrom Fitch Ratings
Rating upgrade highlights strong finances and successful COVID-19 response
SAN RAFAEL and CONCORD, Calif. — On August 25, 2020, Fitch Ratings assigned a ‘BBB+’ Issuer Default Rating to MCE, an upgrade of its previous rating of BBB. Among the reasons for the upgrade are MCE’s increase of available cash on hand from 80 days to 160 days, as well as almost doubling MCE’s available liquidity over the past year. The BBB+ rating takes into consideration
MCE’s strong financial profile and successful management of its load during COVID-19 shifts. MCE was the first CCA to receive an investment-grade credit rating, with a Baa2 Issuer Rating issued by Moody’s in May, 2018, as well as the first to receive a second from Fitch Ratings in August, 2019.
“Fitch’s decision to upgrade MCE’s credit rating demonstrates our financial stability and strength during these unprecedented times,” said Dawn Weisz, MCE CEO. “This upgraded credit rating allows MCE to better serve our customers by increasing access to cost-competitive energy pricing, helping keep rates stable and competitive and increasing access to our customer programs and services.”
Fitch’s upgraded investment-grade credit rating generally reflects the ability of MCE to meet its financial obligations. MCE has no direct debt outstanding. The rating also reflects MCE’s Board decision made in November, 2019, to increase reserves of cash on hand to 240 days.
“The upgrade to ‘BBB+’ is based on stronger than expected financial performance in the past year, the intent to retain larger cash reserve balances and a resolution of rate and regulatory uncertainty that has existed during the Pacific Gas & Electric bankruptcy (PG&E),” said Fitch Rating’s statement. “MCE’s rating is further supported by a strong financial profile that reflects consistently improving liquidity levels over the past two years and helps mitigate the risks associated with the competitive pressures.”
The benefits of this BBB+ rating include:
• MCE’s ability to negotiate lower energy prices and improved credit terms for future contracts;
• Further validation of the CCA business model from an internationally-recognized rating agency; and
• Assurance for customers that MCE’s financial strength is sound and that it will continue to provide competitively-priced and reliable clean energy services over the long term.
MCE offers a choice of three competitively-priced energy service options, including default 60% renewable, Light Green, and 100% renewable Deep Green and Local Sol products. In 2019, MCE’s energy portfolio was approximately 90% carbon-free. MCE has also retained approximately 86% of eligible customers since its launch just over 10 years ago in 2010.
Read Fitch Ratings Statement here.
About MCE: As California’s first Community Choice Aggregation Program, MCE is a groundbreaking, not-for-profit, public agency that has been setting the standard for energy innovation in our communities since 2010. MCE offers cleaner power at stable rates, significantly reducing energy-related greenhouse emissions and enabling millions of dollars of reinvestment in local energy programs. MCE is a load-serving entity supporting a 1,000 MW peak load. MCE provides electricity service to more than 480,000 customer accounts and more than one million residents and businesses in 34 member communities across four Bay Area counties: Contra Costa, Marin, Napa, and Solano. For more information about MCE, visit mceCleanEnergy.org, or follow us on Facebook, LinkedIn, Twitter and Instagram.