DUFF & PHELPS: TEXAS UTILITIES ELECTRIC COMPANY 750,000 SHARES CUMULATIVE PREFERRED STOCK (SHELF) RATED 'BBB-'
CHICAGO, Sept. 30 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has assigned a rating of "BBB-" (Triple-B-Minus) to Texas Utilities Electric Company's (NYSE: TXU) shelf registration for 750,000 shares of cumulative preferred stock, without par value. Proceeds primarily will be used to acquire or redeem outstanding securities. Adequate rate relief for Comanche Peak Unit 2 will be important to sustained improvement in financial measures. The company has made a substantial capital investment in the two-unit, 2300 mw Comanche Peak nuclear project. Unit 2 began commercial operation in early August. A $760 million (15.3 percent) annual increase in rates, primarily to recover the Comanche Peak 2 investment, was requested in January. As allowed by state regulations, the proposed rate increase was put into rates in August, subject to refund. Approximately $3.2 billion of the Unit 2 investment is not in rate base. A final order is expected in late 1993 or early 1994. In July 1993, the company and several intervenors reached a settlement agreement, that if approved by the Public Utilities Commission, would resolve all prudence and fuel issues associated with Comanche Peak. The agreement includes a $250 million capital expenditure disallowance, a $83 million write-off related to allowance for funds used during construction, and a $5 million fuel charge refund. Approximately $4.6 billion of fuel charges are being examined. Common equity issuances have supported the company's financial base in light of strong capital growth and the 1991 write-off for Comanche Peak Unit 1. Texas Utilities Electric has implemented construction cuts, operating cost controls, and higher cost debt refundings. Texas Utilities Electric Company, the principal subsidiary of Texas Utilities Company, provides electric service to parts of north central, eastern and western Texas. The service area contains about one-third of the population of Texas and includes Dallas/Fort Worth metropolitan area. -0- 9/30/93 /CONTACT: John C. Dell of Duff & Phelps Credit Rating Co., 312-368-3161/ (TXU)
CO: Texas Utilities Electric Company ST: Texas IN: UTI SU: RTG
LG -- NY073 -- 7341 09/30/93 13:45 EDT
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|Date:||Sep 30, 1993|
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