Moody's downgrades Eesti Energia

Moody's Investors Service said it downgraded Eesti Energia AS' issuer rating and senior rating to Baa2 from Baa1 and affirmed the short-term P-2 rating. The outlook is stable.

The agency said the action reflects the development of Eesti Energia's business risk profile in light of the increasing integration of the Baltic and Nordic power markets, coupled with generally weak levels of wholesale power prices and challenges associated with the development of shale oil activities.

While Eesti Energia's rating is underpinned by the group's dominant position in Estonia as a vertically integrated utility, the company's small scale and concentration on its CO2-intensive oil-shale-based generation portfolio constrain its rating, Moody's said.

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