DUFF & PHELPS: VIRGINIA ELECTRIC AND POWER COMPANY $200 MILLION FIRST AND REFUNDING MORTGAGE BONDS RATED 'A+'
CHICAGO, June 8 /PRNewswire/ -- Duff & Phelps Credit Rating Co. announced today that it has assigned a rating of "A+" (Single-A-Plus) to Virginia Electric and Power Company's (VEPCO) proposed offering for $200 million of first and refunding mortgage bonds. VEPCO has strong underlying fundamentals. The service area is relatively healthy, and regulation generally has been supportive. Plant operations have been efficient and cost controls have been effective at holding rates down. Construction requirements are manageable. Continued financial stability is expected as a result of increased equity, rate increases, sales growth, and lower borrowing costs. Debt protection measures are weakened by the company's large purchased power obligations. The company's ability to fully collect deferred purchased power capacity payments is a concern. In December 1992, the Virginia State Corporation Commission authorized a $45 million rate increase with a 12.25 percent allowed return on equity, in response to the company's expedited 1991 filing. VEPCO will refund the difference between the $184 million placed in rates on an interim basis and the $45 million authorized. A decision is expected by mid-1993 in the company's general rate filing for a $413.5 million increase in rates. The case will address VEPCO's growing deferred capacity costs. VEPCO, a wholly owned subsidiary of Dominion Resources, Inc., is Virginia's largest electric utility. It serves 1.7 million customers in a 30,000 square mile area in Virginia and northeastern North Carolina. -0- 6/8/93 /CONTACT: John C. Dell of Duff & Phelps Credit Rating Co., 312-368-3161/ (D)
CO: Virginia Electric and Power Company ST: Virginia IN: UTI SU: RTG
TS -- NY040 -- 6498 06/08/93 11:14 EDT
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|Date:||Jun 8, 1993|
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