DBRS Publishes Three Project Finance Methodologies

DBRS released three methodologies as follows:

-- Rating Project Finance,
-- Rating Wind Power Projects, and
-- Rating Solar Power Projects.

These methodologies are effective as of today and supersede those versions published in December 2016.

On December 22, 2017, DBRS requested comments on updates to these three methodologies, with a comment period ending on January 31, 2018. DBRS received comments from two commenters, both of whom requested confidentiality. Several minor changes were made to “Rating Project Finance” in response to these comments, as summarized below.

One commenter suggested greater clarity in the left-hand column of Table 1 on page 16 of Rating Project Finance, “Financial Metrics Guidance for Contracted and Non-Contracted Power Generation Projects.” DBRS has accordingly revised the left-hand column (but not any of the debt service coverage ratio (DSCR) numbers contained within the table) in the version published today. Other comments received included comments on DBRS’s approach to assessing refinancing risk. To the extent DBRS agrees with the comments made, minor edits have been to the refinancing risk discussion on pages 13-14 of “Rating Project Finance.” Certain additional very minor clean-up edits have been made to all three methodologies.

DBRS expects that one solar power project financing may receive a modest rating upgrade as a result of the solar methodology now permitting solar power project ratings in the “A” category, provided certain minimum DSCR and other transaction features are present, as discussed in DBRS’s December 22, 2017, press release.

DBRS criteria and methodologies are publicly available on its website www.dbrs.com under Methodologies.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.