Moody's: Vepco outlook positive

Moody's Investors Service said it changed the outlook for Virginia Electric and Power Co. to positive from stable and affirmed its Baa1 senior unsecured ratings and Prime-2 commercial paper ratings.

The agency affirmed the Baa2 senior unsecured rating for Dominion Resources. The outlook for Dominion is stable.

According to Moody's, the positive outlook for Vepco reflects the supportive regulatory environment in Virginia and the relative stability of expected cash flows over the longer-term horizon.

A significant rate case is under way at the Virginia State Corporation Commission, which creates some near-term regulatory uncertainty, but is not sufficient to mitigate the positive credit bias, the agency said.

Dominion's Baa2 senior unsecured rating and stable rating outlook is supported by the diversity of the company's operations, the agency noted.

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