Fitch downgrades DTEK

Fitch Ratings said it downgraded DTEK Renewables BV’s long-term foreign-currency issuer default and senior unsecured ratings to B- from B and placed it on rating watch negative.

“The downgrade reflects significantly reduced payment (by around 90%) by the state-owned guaranteed buyer for renewable energy since March 2020, as all of the company’s generated electricity is sold to it under approved regulated feed-in-tariffs (FiTs). It also incorporates our assumption of downward revision of FiTs for renewable generators, against the backdrop of the coronavirus pandemic and deterioration in Ukraine’s economy, which we expect to shrink 6.5% in 2020, as well as a liquidity drain,” Fitch said in a press release.

The agency said it will resolve the RWN once the new law regulating FiTs and repayment of outstanding receivables is in force and payments by the guaranteed buyer recover.

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