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Paducah Power System To Switch Bond Rating Service

Paducah Power System

The Paducah Power System Board voted Monday night to contract with Standard & Poor’s Rating Services after the rating company kept the Kentucky Municipal Power Agency revenue bond rating the same at A-.

Fitch Ratings dropped PPS 2 points in December from A- to BBB while Moody’s Investors Service only dropped the power system one point from A3 to Baa1 with a “stable outlook.”

KMPA is a joint action agency formed by Paducah Power System and Princeton Electric Plant Board to interact with the Prairie State Energy Campus. PPS involvement with Prairie State Energy Campus initially caused the power system's rate spikes.

Spokesperson Andrea Underwood says S&P’s favorable KMPA rating gives the PPS administration hope of a similar assessment.

“It would kind of, because it would be closer to what Moody’s gave us, then it kind of puts Fitch out there by itself with that negative outlook and minimize some of the connotations associated with the Fitch ratings,” Underwood said.  

The contract with S&P is estimated at $20,000. The annual surveillance fee would be $2,500 cheaper than Fitch’s current fee of $10,000.

Underwood said a more favorable rating from S&P would benefit PPS’s relationships with vendors and potential business partners and eventually help the power company provide rate relief. The PPS Rate Recovery Plan aims to lower electric bills by July 1, 2015. 

A proud native of Murray, Kentucky, Allison grew up roaming the forests of western Kentucky and visiting national parks across the country. She graduated in 2014 from Murray State University where she studied Environmental Sustainability, Television Production, and Spanish. She loves meeting new people, questioning everything, and dancing through the sun and the rain. She hopes to make a positive impact in this world several endeavors at a time.
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