KBRA Affirms Rating of A with Stable Outlook for Corn Belt Power Cooperative (IA)
22 Aug 2025 | New York
KBRA affirms the long-term rating of A with a Stable Outlook for the Corn Belt Power Cooperative, IA ("CBPC" or "Corn Belt"). CBPC is an electric generation and transmission cooperative that supplies wholesale power to nine electric distribution cooperatives and one municipal electric association (collectively the "members"), with customers across 41 northern Iowa counties. Corn Belt's members provide retail electric service to approximately 39,400 residential, farm, commercial, and industrial customers. Corn Belt sells 100% of its generation output to Basin Electric Power Cooperative ("Basin") and purchases all of its power needs from Basin pursuant to an all-requirements contract, above its members' Western Area Power Administration hydropower allocation.
Key Credit Considerations
Credit Positives
- CBPC’s members are contracted to purchase all power requirements from Corn Belt pursuant to take-and-pay agreements through 2075, beyond the final maturity of long-term debt.
- CBPC and its members maintain sound financial performance, supported by independent rate setting authority, exclusive service areas, and relatively competitive electric rates.
- Through its membership in Basin and participation in the Southwest Power Pool, Corn Belt's operating risk is minimized and its exposure to the electric market volatility is moderated, supporting member wholesale rate stability.
Credit Challenges
- CBPC’s wholesale cost of power will be pressured upward, as will member retail rates, due to Basin's increasing power supply cost as it addresses rapid load growth occurring in its 9-state territory.
- CBPC serves a relatively small number of ultimate customers compared to its peers, with modest load growth. Its members’ customer load is concentrated in the ethanol/biodiesel industry, which accounts for almost a third of total member load.
Rating Sensitivities
For Upgrade
- Load growth or expense reductions that result in consistently stronger CBPC financial performance.
- CBPC wholesale cost of power below expectations supporting members' rate competitiveness.
For Downgrade
- CBPC debt service coverage and TIER consistently lower than projected would be a negative credit factor.
- Consistently weaker member financial performance or material reduction in ethanol demand which CBPC could not offset, could pressure the rating lower.
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