The hydroelectric Project Number One revenue bonds, totalling US$88.5M for series A and B, were rated “A”, and affirmed the same rating grade on a further US$476M of bonds. The bonds are due to close on 2 April.

Key to the rating grade is the underlying credit quality of the venture partners and their position in the state’s changing regulatory framework, said Fitch. It added that provisions of the unconditional take-or-pay power purchase agreements (PPAs), strong project operations and competitive project economics were also important.

The credit ratings agency noted, however, NCPA’s has a need for additional generation and associated finance, specifically for renewable capacity. Incremental costs of new generation plus cost of compliance with efforts to reduce carbon emissions are expected to add to economic pressures on the utilities in California, Fitch added.