CONSISTENTLY STRONG FINANCIAL PERFORMANCE: CIPCO continues its trend of strong financial performance, as evidenced by Fitch-calculated debt service coverage (DSC) of 1.
The CIPCO members, in turn, provide power through a 300 mile service territory that spans diagonally across central and southern Iowa.
The RECs purchase power from CIPCO pursuant to take-or-pay, all-requirement contracts that extend through 2045.
56MW and are part of CIPCOs
plan to incorporate emissions-free resources to their assets.
More specifically, CIPCO receives approximately 85% of its total power supply from its ownership interests in the nuclear DAEC and the Walter Scott #3 and #4 and Louisa coal-fired units, all of which have a recent history of relatively low-cost and solid operation.
With the addition of several new agreements to purchase wind capacity and plans to construct new gas-fired capacity over the intermediate term, CIPCO portfolio of resources is becoming increasingly more diverse and less reliant on coal-fired generation.
A renewal would extend the DAEC operating license by 20 years to February 2034 and would provide CIPCO
with a long-term, base-load generating resource that is 'carbon-free' well into the future.
CIPCO benefits by reducing its concentration of revenue (14% of 2005 total) and single customer risk, as well as its exposure to purchase power.
Further credit support is provided by CIPCO's diverse power supply (primarily coal and nuclear) and minimal purchased power exposure going forward, a strong Operating & Transmission Agreement with Alliant that extends through 2035 and has been very beneficial to CIPCO, and strong member support demonstrated by the recent 10-year extension (to 2045) of take-and-pay all-requirements power supply contracts with all 12 of its Rural Electric Cooperative members.
The license renewal would enable CIPCO to release approximately $28 million from a decommissioning reserve fund.