Municipal Electric Authority of Georgia’s $1.03 billion bonds upgraded by Moody’s

Moody’s Ratings upgraded Municipal Electric Authority of Georgia’s $1.03 billion in Plant Vogtle Units 3 and 4 Project bonds to Baa1 from Baa2. The outlook is stable.

Moody’s pointed to its recent upgrade of the sole consumer of power from units 3 and 4 — PowerSouth Energy Cooperative — to A3. PowerSouth’s purchases of wholesale power will be the sole source of repayment of the bonds for two decades.

MEAG’s power purchase agreement with PowerSouth “provides the sole source of repayment for the MEAG Project P bond during the first 20 years of operations,” Moody’s said.

The rating upgrade also reflects the “sound operational performance of both Vogtle Units 3 and 4,” which entered service on July 31, 2023, and April 29, 2024, respectively, Moody’s said. In the fiscal year ending in December, the nuclear-powered units had an average capacity factor of 79%, for Unit 3, which suffered a refueling outage, and 92% for Unit 4.

“The successful start-up of Vogtle Units 3 and 4 eliminates remaining construction risk and additional capital cost increases, which in turn limits the potential for further adverse rate impacts to PowerSouth as an offtaker,” Moody’s said.

After the initial 20-year period, 39 of MEAG Power’s wholesale utility participants are obligated to purchase the units’ power until 2064.

MEAG Power is a public corporation that provides wholesale electricity to municipally owned electric distribution systems. 

S&P rates the Project P bonds BBB-plus with a stable outlook.