Algonquin Power Co.: Rating Report

On January 22, 2020, DBRS Limited (DBRS Morningstar) confirmed both the Issuer Rating and the Senior Unsecured Debentures rating of Algonquin Power Co. (operating as Liberty Power Co; APCO or the Issuer) at BBB with Stable trends. The Issuer is wholly owned by Algonquin Power & Utilities Corp. (APUC or the Parent; rated BBB with a Stable trend by DBRS Morningstar). The confirmations reflect the following factors: (1) APCO’s improved operational size and scale over the past year with the addition of newly completed wind power project in Canada and solar power projects in the United States; (2) stable and solid contractual profile associated with its power generation portfolio, which has a weighted-average (WA) contract length of 14 years (approximately 86% of the output being under long-term contracts); (3) APCO’s solid credit metrics (on a pro forma basis); and (4) solid liquidity and financial flexibility. The Stable trends incorporate APCO’s manageable project construction risk and the expected resiliency of its credit metrics over the medium term.