Utilities

The VPFS trust offers two AAA-rated, class A tranches to investors, which have legal final maturity dates of May 1, 2029 and May 1, 2033.

The debate centers around whether the island's main energy supplier, Electric Power Authority or Prepa, must repay its creditors more than just the roughly $19 million sitting in reserve accounts.

The deal will issue tax-exempt restructuring bonds through the 2023TE1 and 2 classes of notes, which will issue $652.1 million and $135.4 million, respectively. One class will issue $35.6 million federally taxable note, the 2023T class.

DTE Electric Securitization, 2023A will issue notes to investors through two class A tranches, which are identical in certain characteristics, such as their 'Aaa' ratings, and their $300.8 million principal amounts.

The security driving the revenue to the bonds is a tariff on customers' monthly bills, in line with the "U.S. Utility Tariff/Stranded Cost Bonds Rating Criteria."

The securitization is backed by an irrevocable financing order that empowers the issuer to impose, collect and receive fixed recovery charges (FRC), from retail customers.

The deal is the second securitized transaction floated under recent California state legislation authorizing a flurry of utility securitizations.

Ratepayer bond securitizations have helped utilities defray litigation expenses or finance 'stranded costs' related to deregulation since the '90s . A new wave appears imminent, driven by green-energy conversion needs and relieving the burden of pandemic-related consumer assistance.