Market updates and sector developments

New York State Electric and Gas (NYSEG), a subsidiary of Avangrid, is moving ahead with what will be the inaugural recovery bond issued by a New York state utility, say sources.

It is currently putting together a petition for a financing order and has hired both advisor and counsel.  A bond issue is expected before the end of the year, they add.

Earlier this month, Governor Kathy Hochul signed into law “The New York utility corporation securitization act”, otherwise known as NY senate bill S9339. This passed the assembly and senate on June 7 and was presented to Governor Hochul on August 14.

Recovery bonds are an increasingly popular securitization tool by which state utilities can recover infrastructure expenditures, but they need official sanction from state authorities. About half the states in the union have now passed the requisite legislation, and some US$2bn of issuance is anticipated this year.

NYSEG was in the news last week after hundreds of customers complained about substantially higher bills following the installation of smart meters.

Simon Boughey