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Mecklenburg Electric Cooperative’s Power Supplier
ODEC Receives Upgrade In Moody’s Investor Rating
 

(Glen Allen, VA) – Over 65 years ago, Mecklenburg Electric Cooperative (MEC), and most of its sister cooperatives across the three-state region of Virginia, Maryland, and Delaware, determined that pooling and combining electricity purchases could render substantive savings and efficiencies that would bring value to the Members they exist to serve. Accordingly, they successfully formed Old Dominion Electric Cooperative (ODEC), a generation and transmission cooperative which to this day, is still owned and controlled by 11 distribution cooperatives, including MEC that provide power to memberships in those same three states.

 

­­In today’s volatile power markets and, given that the wholesale power industry is very capital intensive and long term, ODEC’s financial strength has a tremendous impact on the cost of power it sells to its 11 Member distribution cooperatives. A strong financial position at ODEC results in more desirable interest rates, and loan terms, which keep costs down and benefit the Members of the distribution cooperatives who own the organization.

 

On December 18, 2013, Moody’s Investors Service, one of three agencies (along with Fitch and Standard and Poors) that investors depend on for corporate ratings and financial information, upgraded ODEC’s senior secured debt ratings to A2 from A3 and raised the cooperative’s rating outlook to “stable” frompositive.” According to Kevin Rose, vice president-senior analyst at Moody’s, “The rating action takes into account ODEC’s consistent trend of maintaining sound credit metrics… which provides a strong financial foundation as the cooperative undertakes construction of a 1,000 megawatt gas-fired generation plant.”

 

The Board of Directors for ODEC consists of 22 members, two from each of its member-owner cooperatives, and one of whom is the Chairman of MEC’s Board, Mr. David Jones. According to Jones, who serves on the ODEC Board Finance Committee, “The prudent, tough decisions made by ODEC’s Board, and the dedication of ODEC employees, have resulted in a strong organization that works effectively to provide the most cost effective wholesale electricity for MEC’s Members, and others across three states.”  Jones goes on to say, “And their (ODEC) charge is the same as ours at the local cooperative, which is do the right thing by your Members; and maintaining outstanding credit ratings that result in lower costs does just that.” 

 

John Lee, president and CEO of Mecklenburg Electric, is a former 16-year employee of ODEC who experienced, first-hand, some of those tough decisions. Lee, who now serves on the ODEC Board with Jones, and chairs the ODEC Board Strategic Planning Committee, spearheaded much of the initial approval work needed for ODEC’s coal-fired power plant at Clover, and several gas-fired combustion turbines in Virginia and Maryland. Lee comments, “The decision to form ODEC has been a sound one for those to whom it provides wholesale power, and it is our Members at the end of the line who ultimately benefit from ODEC’s financial success,” adding “ODEC’s financial foundation is built on the collective strength of MEC and the 10 other cooperatives that own it; and upon that base, ODEC has undertaken and owns an impressive list of generation facilities, secured favorable power supply contracts, and all the while has built a reputation as one of the most fiscally successful cooperatives, of any kind, in the nation.”

 

“We have always been, and remain, dedicated to strengthening ODEC’s financial condition so that we can provide low-cost power for our member-owners,” says Bob Kees, ODEC’s senior vice president and CFO.  Kees adds, “Since we first received our A3 rating from Moody’s in 1992, we’ve tripled our equity ratio while building multiple power plants to meet the needs of our Members.”

 

ODEC has credit ratings from three agencies. In addition to its A3 (stable outlook) rating from Moody’s, ODEC has a secured credit rating of A (stable outlook) from both Standard and Poor’s and Fitch Ratings. ODEC also has an issuer credit rating of A (stable outlook) from Standard and Poor’s. Each rating agency has its own ratings criteria and ranking system.

 

About Mecklenburg Electric Cooperative

Mecklenburg Electric Cooperative is the not-for-profit consumer-owned energy provider to over 31,000 homes, farms and businesses located in portions of the counties of Brunswick, Charlotte, Greensville, Halifax, Lunenburg, Mecklenburg, Pittsylvania, Southampton and Sussex. It is headquartered in Chase City with district offices in Emporia, Chase City and Gretna.


 

 
 
 

This institution is an equal opportunity provider and employer

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