For immediate release: 08/15/08

Second upgrade since October 07 …
GRDA receives upgrade, S&P moves credit rating from "A-" to "A"

Vinita – For the second time in ten months, the Grand River Dam Authority has received a credit rating upgrade from Standard & Poor’s (S&P) Rating Services.

On Thursday (August 14), S&P announced it has assigned an “A” rating to GRDA’s revenue bonds, while moving the outlook from positive to stable. That announcement comes just ten months after S&P gave GRDA the first rating upgrade in the history of the Vinita-based electric utility; that was an upgrade from “BBB+” to “A-“ minus assigned last October.

“For GRDA, this is further validation that our efforts over the last four years to get our financial house in order are being noticed by experts in the financial community,” said GRDA Chief Executive Officer Kevin Easley. “This is also important news for our customers and other constituents. Obviously, we feel that a financially strong GRDA, with a solid credit rating is good for everyone.”

In citing reasons for the upgrade, S&P pointed first to the willingness of the GRDA Board of Directors to “raise rates as needed to strengthen the financial profile.”

“GRDA’s management team has worked very closely with the board on issues that have directly impacted the improved credit position,” said Easley. “Our board has made some tough decisions in recent years but they’ve all been done with an eye on improving GRDA’s financial position.”

In both S&P rating upgrades, as well as the three outlook improvements GRDA received between March 2005 and January 2007, the leadership of the GRDA Board has always been a key factor, added Easley.

“And once again, we can see the results of the kind of leadership that is committed to moving GRDA forward.”

S&P also said that new long term contracts with electric customers, the addition of gas-fired generation to supplement an already beneficial mixture of coal and hydroelectricity, and “a steady but gradual growth in the service territory” were also major contributors to the latest upgrade.

“There have been a lot of positives in those areas in recent years,” said GRDA Chief Financial Officer Carolyn Dougherty. “Finalizing the new contracts with our municipal customers was a team effort throughout. And their willingness to commit to a partnership with GRDA for at least 35 more years does send a strong, positive signal to the financial community.”

According to Easley, already-strong partnerships with those customers will benefit even more from GRDA’s improving financial condition and credit ratings.

“For those who may be asking ‘why does this matter to me?’ GRDA would respond that it believes this upgrade will save our customers millions of dollars in finance and insurance charges as we continue to grow and plan a safe, reliable and affordable electric future,” said Easley.

“Our commitment is to ensure GRDA always remains what it is today – Oklahoma’s low-cost, reliable electric supplier. This good news from S&P helps to support that commitment.”

Finally, Easley praised the continuing efforts of the GRDA workforce in helping to bring about the positive credit changes in recent years.

“The everyday efforts of our employees, who operate the generators, maintain the system and keep the business of GRDA moving forward, cannot be overlooked,” he said. “They are responsible for the efficient and reliable operations of this organization and without those things it is hard to make the case for improved credit ratings. Our board, our customer partners and our employees should all be commended for our recent credit successes.”

Headquartered in Vinita, GRDA is a self-supporting state agency, funded by the revenues from the sale of electricity instead of taxes. GRDA transmits and delivers electricity across its 24-county service area via a sophisticated energy delivery system that includes over 1,900 miles of transmission line. GRDA sells wholesale electricity to three customer classes: municipals, electric cooperatives, and industries.

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Credit Rating Chart detailing GRDA's credit improvements 2005 - present