The Public Power Generation Agency (PPGA), which includes the Municipal Energy Agency of Nebraska and four other electric utilities in the region, recently completed a bond refunding on the Whelan Energy Center Unit 2 (WEC 2) project located near Hastings, Neb.
Fitch Ratings upgraded its Issuer Default Rating on PPGA to ‘A’ from ‘A-’ with a stable outlook. Moody’s Investors Service issued a credit opinion affirming PPGA’s A2 rating and stable outlook.
The bond refunding is expected to save PPGA member utilities approximately $10 million overall, which includes MEAN’s portion of approximate savings of $3.6 million over the life of the bonds for its participating wholesale power communities.
PPGA is a joint action agency created in 2005 for the purpose of owning, financing, acquiring, constructing and operating WEC Unit 2, a 220-megawatt coal-fired power plant. PPGA consists of MEAN, Heartland Energy, Grand Island Utilities, Hastings Utilities and Nebraska City Utilities. WEC 2 began commercial operation in 2011.
In upgrading PPGA’s rating of WEC Unit 2, Fitch cited the strong and improved credit quality of PPGA’s members along with their take-or-pay agreements that extend to the later of the final bond maturity or decommissioning of the project.
The rating additionally reflects PPGA’s low operating risk and also considers uncertainty of long-term capital requirements and the potential impact of proposed federal regulations to limit carbon emissions.
Fitch’s ratings opinion cited the power plant’s strong operational performance and low costs. The unit provides “a strategic and dependable source of generating capacity to its members and to the SPP (Southwest Power Pool) market. The project has proven resilient during severe weather with 100 percent unit availability during storms Uri (2021), Elliot (2022) and Gerri (2024).”