Basin Electric team visits credit rating agencies in New York

Members of the Basin Electric leadership team visited three major credit rating agencies in May in New York City.  

Each of the agencies—Fitch Ratings, Moody’s, and S&P Global Ratings— issue credit opinions and ratings for Basin Electric, according to Sarah Scherm, Basin Electric vice president and treasurer. These ratings, she said, are important because banks, investors, and other counterparties use them to determine whether to lend money to or do business with the cooperative. The ratings are also used to set interest rates on any new debt.  

Visiting the agencies allows the cooperative to discuss Basin Electric directly with the analysts and answer any questions they may have.  

“Ratings are based on both qualitative and quantitative factors and these meetings provide an opportunity for us to shed light on what’s happening with the cooperative, outside of what can be found in the published financial statements,” Scherm said.  

Topics discussed at this year’s meetings included an overview of the cooperative’s 2024 financial results, an update on existing and future capital projects, information on forecasted debt issuances, an update on load forecast and discussion of potential new large loads, and updates on any outstanding litigation. 

“We typically meet with each of the three agencies in person in New York City once a year, each meeting lasting about two hours,” she said. “We also have periodic calls and exchange email updates throughout the year. It is our responsibility to provide them with the relevant information they need to provide an accurate risk rating for Basin Electric.” 

Scherm said the treasury team plans to visit with the agencies again later this summer, either virtually or in person, once an updated long-term financial forecast has been approved by the cooperative’s board of directors.