Moody’s announces completion of a periodic review of ratings of Connecticut Municipal Electric Energy Coop.

Conn. Energy Head Taking ‘A Serious Look’ At Exiting Regional Power Market
January 16, 2020
Moody’s announces completion of a periodic review of ratings of Connecticut Trans. Muni. Elec. Energy Coop.
February 28, 2020
Show all

Moody’s announces completion of a periodic review of ratings of Connecticut Municipal Electric Energy Coop.

Announcement of Periodic Review: Moody’s announces completion of a periodic review of ratings of
Connecticut Municipal Electric Energy Coop.

26 Feb 2020

New York, February 26, 2020 — Moody’s Investors Service (“Moody’s”) has completed a periodic
review of the ratings of Connecticut Municipal Electric Energy Coop. and other ratings that are
associated with the same analytical unit. The review was conducted through a portfolio review in
which Moody’s reassessed the appropriateness of the ratings in the context of the relevant
principal methodology(ies), recent developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a rating committee. Since 1 January
2019, Moody’s practice has been to issue a press release following each periodic review to announce
its completion.

This publication does not announce a credit rating action and is not an indication of whether or
not a credit rating action is likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted by this announcement. For any
credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page
on www.moodys.com for the most updated credit rating action information and rating history.

Key rating considerations are summarized below.

Connecticut Municipal Electric Energy Cooperative’s (CMEEC) Aa3 revenue bond ratings reflect the
benefits of producing stable and predictable revenue and cash flow through strong all requirements
take-or-pay contracts with members and other power supply contracts with participants whose
weighted average creditworthiness approximates A1. The rating also considers that CMEEC provides
safe and reliable power supply and transmission services under reasonably competitive rates in
comparison to similar service providers in the region and is likely to maintain its historically
sound liquidity, coverage and debt ratios because it has no apparent incremental debt financing
needs for the next several years. These credit supportive traits remain intact as CMEEC transitions
under the leadership of a new CEO appointed in December 2019 and seeks to further distance itself
from the credit negative overhang of the termination of its former CEO that occurred following the
November 2018 federal indictments against several senior officials alleging conspiracy and misuse
of CMEEC funds.

This document summarizes Moody’s view as of the publication date and will not be updated until the
next periodic review announcement, which will incorporate material changes in credit circumstances
(if any) during the intervening period.

The principal methodology used for this review was US Municipal Joint Action Agencies Methodology
published in August 2019. Please see the Rating Methodologies page on www.moodys.com for a copy of
this methodology.

This announcement applies only to EU rated and EU endorsed ratings. Non EU rated and non EU
endorsed ratings may be referenced above to the extent necessary, if they are part of the same
analytical unit.

This publication does not announce a credit rating action. For any credit ratings referenced in
this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the
most updated credit rating action information and rating history.

Kevin Rose Lead Analyst Project Finance
Moody’s Investors Service, Inc. 7 World Trade Center
250 Greenwich Street
New York 10007 US
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

Kurt Krummenacker MANAGING DIRECTOR
Project Finance
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653
Releasing Office:
Moody’s Investors Service, Inc. 250 Greenwich Street
New York, NY 10007 U.S.A
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

© 2020 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their
licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY’S INVESTORS SERVICE, INC. AND/OR ITS CREDIT RATINGS AFFILIATES ARE
MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR
DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY
MOODY’S (COLLECTIVELY, “PUBLICATIONS”) MAY INCLUDE SUCH CURRENT OPINIONS. MOODY’S INVESTORS
SERVICE DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL
OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR
IMPAIRMENT. SEE MOODY’S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES
OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S INVESTORS SERVICE CREDIT RATINGS. CREDIT
RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE
RISK, OR PRICE VOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS (“ASSESSMENTS”), AND OTHER
OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT.
MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND
RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. AND/OR ITS AFFILIATES. MOODY’S
CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE
INVESTMENT OR FINANCIAL ADVICE, AND MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND
PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR
SECURITIES. MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT COMMENT
ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT
RATINGS, ASSESSMENTS AND OTHER OPINIONS AND PUBLISHES ITS PUBLICATIONS WITH THE EXPECTATION AND
UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH
SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE,
HOLDING, OR SALE.

MOODY’S CREDIT RATINGS , ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS ARE NOT INTENDED FOR USE BY
RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S
CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF
IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW,
AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER
TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR
ANY SUCH PURPOSE, IN

WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S
PRIOR WRITTEN CONSENT.

MOODY’S CREDIT RATINGS , ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT INTENDED FOR USE BY
ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN
ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY’S from sources believed by it to be accurate
and reliable. Because of the possibility of human or mechanical error as well as other factors,
however, all information contained herein is provided “AS IS” without warranty of any kind.
MOODY’S adopts all necessary measures so that the information it uses in assigning a credit rating
is of sufficient quality and from sources MOODY’S considers to be reliable including, when
appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in
every instance independently verify or validate information received in the rating process or in
preparing its Publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents,
representatives, licensors and suppliers disclaim liability to any person or entity for any
indirect, special, consequential, or incidental losses or damages whatsoever arising from or in
connection with the information contained herein or the use of or inability to use any such
information, even if MOODY’S or any of its directors, officers, employees, agents,
representatives, licensors or suppliers is advised in advance of the possibility of such losses or
damages, including but not limited to: (a) any loss of present or prospective profits or (b) any
loss or damage arising where the relevant financial instrument is not the subject of a particular
credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents,
representatives, licensors and suppliers disclaim liability for any direct or compensatory losses
or damages caused to any person or entity, including but not limited to by any negligence (but
excluding fraud, willful misconduct or any other type of liability that, for the avoidance of
doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control
of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or
suppliers, arising from or in connection with the information contained herein or the use of or
inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT RATING, ASSESSMENT, OTHER OPINION OR INFORMATION
IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s
Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate
and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s
Investors Service, Inc. have, prior to assignment of any credit rating, agreed to pay to Moody’s
Investors Service, Inc. for credit ratings opinions and services rendered by it fees ranging from
$1,000 to approximately $2,700,000. MCO and Moody’s investors Service also maintain policies and
procedures to address the independence of Moody’s Investors Service credit ratings and credit
rating processes. Information regarding certain affiliations that may exist between directors of
MCO and rated entities, and between entities who hold credit ratings from Moody’s Investors Service
and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is
posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance —
Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to
the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty
Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136
972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale
clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access
this document from within Australia, you represent to MOODY’S that you are, or are accessing the
document as a representative of, a “wholesale client” and that neither you nor the entity you
represent will directly or indirectly disseminate this document or its contents to “retail
clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is
an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity
securities of the issuer or any form of security that is available to retail investors.

Additional terms for Japan only: Moody’s Japan K.K. (“MJKK”) is a wholly-owned credit rating
agency subsidiary of Moody’s Group Japan G.K., which is wholly-owned by Moody’s Overseas
Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned
credit rating agency subsidiary of
MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore,
credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are
assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify
for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered
with the Japan Financial Services Agency and their registration numbers are FSA Commissioner
(Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including
corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated
by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to
MJKK or MSFJ (as applicable) for credit ratings opinions and services rendered by it fees ranging
from JPY125,000 to approximately JPY250,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.