Correction: Fitch Affirms Tri-State G&T Sr Sec At 'A'; Implied Senior Unsec At 'A-'.

Business Editors

NEW YORK--(BUSINESS WIRE)--Dec. 19, 2002

(This is an amended version of a press release issued on Dec. 12, 2002, containing revised rating information on the Gallup, NM bond issue, in place of the Platte County revenue bonds.)

Tri-State Generation and Transmission Association, Inc.'s (Tri-State) underlying senior secured rating of 'A' and implied senior unsecured rating of 'A-' are affirmed by Fitch Ratings. The Rating Outlook is Stable. The underlying rating applies to outstanding $12 million Moffat County and $69 million of City of Gallup, NM pollution control revenue bonds issued on behalf of Tri-State, which are fully insured by one of the four 'AAA'-rated, nationally recognized bond insurers. Tri-State does not intend to publicly issue senior unsecured debt, however the rating was assigned to establish Tri-State's credit strength as a third party power provider/purchaser.

Tri-State's credit strengths stem from the electric cooperative's competitively priced power supply (currently averaging 3.9 cents per kwh, including transmission), sound financial performance, a fiscally conservative management team, strong sales growth, and a geographically and economically diverse member base spread across four states (CO, WY, NM, NE). Tri-State's competitive profile is further enhanced by the slow pace of electric deregulation exhibited in its various member service territories.

The cooperative's competitive power supply benefits from mostly hydroelectric and coal-fired resources, accounting for over 80% of total power supply. Financial performance has been stable, with Fitch calculated debt service coverage ratio ranging from 1.22 times (x)-1.33x through 2000 (including lease payment), and equity capitalization of 13%-17%. Fiscal year 2001 was negatively impacted by high-priced spot market purchases needed to: (a) replace power lost during an unexpected plant outage, and (b) meet growing load requirements in excess of Tri-State's supply. Despite the cost increases, Tri-State utilized a portion of cash reserves and implemented a 10% average wholesale rate increase (March 2002) to effectively manage the higher expenditures, yet maintain rate competitiveness. Additionally, Tri-State's liquidity position has remained solid with $80 million in available cash, $50 million in committed but undrawn loan funds (from federal lending institutions), and $100 million in bank lines of credit - roughly equivalent to120 days operating expenses.

Credit concerns center on Tri-State's future power supply strategy/resources needed to meet load growth, tighter projected financial performance ratios, and moderate industrial revenue concentration at the member system level. Tri-State's dwindling surplus power has increased the cooperative's spot market exposure the past few years. To mitigate this exposure going forward, Tri-State is building several small, gas-fired peakers in Colorado and New Mexico, which will increase gas-fired generating capacity to 16% by 2004, from 3% at year-end 2001. On a longer term basis, given solid load growth Tri-State's plans to jointly build new baseload generating facilities, likely coal-fired plants in Arizona and Colorado in 2006 and beyond. Fitch will be monitoring the development of these projects, particularly as it will impact the cooperative's power supply costs and competitive position in the future. Another concern is the slightly tighter projected financial coverage ratios and weaker balance sheet compared to historic levels. Partially offsetting this concern is Tri-State's plan to maintain a lower level of patronage capital distributions and solid level of available cash ($100 million), providing for the gradual rebuilding of equity capitalization to 20% by 2007.

Tri-State is a not-for-profit wholesale provider of power and transmission to 44 member distribution systems. The members provide retail electric service to approximately 502,000 customers, representing a population of roughly 1 million.