Moody's Investors Service has completed its Western Grid Surveillance Review, a study that assessed the potential impact of the California Public Utilities Commission's (CPUC's) electric restructuring proposal on municipal utilities in that region. Based on its findings, Moody's has downgraded the debt ratings of five California municipals from Aa to A1: Anaheim-Electric Revenue; Burbank Public Service Department-Electric and Water Revenue; Pasadena-Electric Revenue; Riverside-Electric Revenue; Southern California Public Power Authority-Power Project Revenue Bonds (Palo Verde).
Moody's believes retail access will be allowed in municipal utility service areas, and expects other states in the region to be affected by the CPUC's decision. The review, therefore, included Washington, Arizona, and Oregon, states that belong to the Western Systems Coordinating Council. Major municipal credits in these states were confirmed, however.
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