The New York Power Authority (NYPA) issued $734.2 million in bonds to make improvements to the state’s electrical grid that will allow it to incorporate more renewable energy.
The bonds mature between 2026 and 2063, yielding between 3.71% and 5.3%. They received an insured rating of AA from S&P Global Ratings and underlying rating of A1 from Moody’s Investors Service, AA- from Fitch Ratings, and AA- from Kroll Bond Rating Agency.
“The ‘AA-’ rating on the transmission project revenue bonds reflects the limited security pledge supporting the bonds and the credit quality of NYPA’s separately financed transmission project,” Fitch analysts wrote.
The bond proceeds will finance a series of upgrades to transmission lines known as the Smart Path Connect Project. The initiative will enable New York electricity providers to disburse 1,000 additional megawatts of renewable energy, according to NYPA.
The project “will allow renewable generation from the northern New York region to be transmitted to higher load areas of the State, improving both the State’s renewable energy consumption and the efficiency of energy pricing throughout the state,” according to the official statement accompanying the sale of the bonds.
The bonds are special limited obligations of the authority, payable by revenue from the transmission project and some state funds.
Goldman Sachs & Co LLC served as lead underwriter on the issuance, purchasing the bonds for $747 million. The price reflected a premium of $17 million and a discount of $4 million.