Moody’s upgrades PG&E

Moody's Investors Service said it upgraded PG&E Corp.'s issuer rating, senior credit facility and senior bonds to A3 from Baa1. It also upgraded the senior debt rating at Pacific Gas & Electric Co., the company’s principal utility operating subsidiary, to A2 from A3 and its preferred stock to Baa1 from Baa2. The outlook on both companies was revised to stable from positive.

“PG&E has resolved the principal legal claims related to the San Bruno pipeline explosion and other incidents while maintaining a strong financial profile," Swami Venkataraman, Moody’s senior vice president, said in a news release. "California provides a strong regulatory framework with a broad suite of cost recovery mechanisms that provides good transparency into PG&E's cash flows."

The agency said the upgrade also reflects the company's modest debt leverage and a robust financial performance, balanced by demanding public policy goals and an elevated level of political risk, especially given the company's history of safety and governance issues.

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