On May 16, 2018, Moody’s Investors Service, a financial and economic rating agency, issued its first ever credit rating to a Community Choice Aggregator (CCA). Marin Clean Energy, founded in 2008 pursuant to a Joint Exercise of Powers Act, is the first California CCA, and the first ever to receive a credit rating, Baa2, subject to moderate risk. CCAs are administered by local government authorities with a mission to provide competitive retail electric alternatives to Investor Owned Utility providers. CCAs have built new, local renewable generable facilities led by early efforts from Marin Clean Energy. CCAs also allow for communities to join together to purchase electricity on behalf of their community members, typically to provide access to carbon-free resources.
Moody’s credit rating highlights Marin Clean Energy’s 2017 upward growth in retail sales which accounts for 62% of renewable energy and its customer base currently stands at more than 400,000 customers. Moody’s notes that a “key aspect of the value proposition” “and one of the most significant factors that provides strength to the long-term business model,” is Marin Clean Energy and other California CCAs requirement that renewable and clean energy be a significant component of the customers’ power supply mix. This credit rating underpins Marin Clean Energy’s increasing internal liquidity sources and recognizes that Marin Clean Energy electric rates continue to remain moderately lower than investor owned utility providers like, Pacific Gas & Electric Company.
In addition, Moody’s recognized Marin Clean Energy’s steady track record of operations and improving financial performance and economic development. Since 2010, Marin Clean Energy has maintained an operating track record of delivering savings on retail customers’ electric bills, providing clean power to the grid and building an ongoing customer base. Moody’s said that the rating outlook is stable and incorporates a view that Marin Clean Energy’s business model will remain intact including statutory and municipal ordinances that permit full recovery and Marin Clean Energy will be able to manage power procurement risk to reach and maintain an appropriate liquidity target that supports its growth.
For further information on CCAs, please contact Michael Postar
, Sean M. Neal
, Peter Scanlon
, Bhaveeta K. Mody
or Andrew B. Art