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Fitch Affirms Georgia Transmission Corp's Commercial Paper Program at 'F1+'

February 4, 2014

NEW YORK --(BUSINESS WIRE)-- Fitch Ratings has affirmed the 'F1+' rating on Georgia Transmission Corporation's (GTC, or the corporation) $275 million commercial paper (CP) program. SECURITY The CP notes are general unsecured obligations of GTC. KEY RATING DRIVERS SOUND LONG-TERM RATING AND LIQUIDITY: GTC's 'AA-' long-term credit rating (senior secured obligations) and ample liquidity sources support the 'F1+' on its CP program. SOLID COVERAGE: Total resources provided solid 1.5x coverage of maximum potential requirements in 2013 (averaged quarterly), including 1.64x at Dec. 31 . A $275 million revolving credit agreement led by National Rural Utilities Cooperative Finance Corporation (CFC) matches the maximum size of GTC's CP program. CRITICAL SERVICE PROVIDER: The corporation's more than $2 billion of total assets and participation in the state's Integrated Transmission System make its transmission network an essential part of the Georgia electric power infrastructure. SOUND LONG-TERM CHARACTERISTICS: Take-or-pay, joint and several transmission service agreements with its member cooperatives extend through December 2060 , providing GTC with a reliable revenue stream for the long term. In addition, nearly all of GTC's revenue requirements are based on predictable fixed-cost expenses, which further enhances its overall financial stability. RATING SENSITIVITIES OVERALL STABILITY BENEFITS RATING: The strength and stability of its long-term credit rating, coupled with its various liquidity sources, should continue to support the 'F1+' on GTC's CP program for the foreseeable future. CREDIT PROFILE AMPLE LIQUIDITY SOURCES The CFC-led, $275 million revolving credit agreement, together with GTC's unrestricted cash and an additional $250 million CoBank-led revolver, provide more than Fitch's expected coverage metric of 1.25x the maximum size of the CP program. The CFC- and CoBank-led revolvers are for general corporate purposes. However, in practice GTC limits total draws by the amount of outstanding CP notes, as outlined in the 'Financial Condition' section of the corporation's 2012 audit. GTC's goal at all times is to maintain adequate financial support for the program. GTC recently extended the CFC-led revolver by two years to November 2018 . The corporation amended the timing provisions of the CoBank-led revolver in March 2013 to ensure its full availability. In addition, GTC expanded the size of the revolver to $250 million from $150 million in December 2013 and likewise extended the term to 2018. Events of default under the CFC-led revolver include material members representing greater than 20% of gross operating revenues and subsidiaries, of which GTC has neither. LIQUIDATION PROCEDURES PLAN GTC has developed a liquidation procedures plan that broadly outlines how the corporation would manage a failed rollover of CP notes. Fitch views favorably the maintenance of such procedures to ensure the proper redemption of maturing CP. The plan draws from bank authorizations, incumbency certificates, and related agreements to specify the timing of funding sequences and authorized personnel. BROAD TRANSMISSION PROVIDER GTC is a not-for-profit corporation providing transmission services to 38 of 41 distribution cooperatives in Georgia and to Oglethorpe Power Corporation (OPC). GTC's member corporations provide electric distribution to a combined 1.8 million customers, or approximately 4.1 million people, across most of the state. GTC began operations in 1997 when OPC was divided into three separate entities. GTC became owner of the transmission assets, providing transmission service to its members; OPC retained control of power generation; and Georgia System Operations assumed responsibility for system operations. For more information on GTC's 'AA-' long-term credit rating, see Fitch's report dated April 10, 2012 . Additional information is available at '' . This rating action was informed by the sources of information identified in Fitch's Rating U.S. Public Finance Short-Term Debt criteria and U.S. Public Power Rating Criteria. Applicable Criteria and Related Research : --'Rating U.S. Public Finance Short-Term Debt' ( Dec. 9, 2013 ); --'U.S. Public Power Peer Study -- June 2013 ' ( June 13, 2013 ); --'U.S. Public Power Peer Study Addendum -- June 2013 ' ( June 13, 2013 ); --'U.S. Public Power Rating Criteria' ( Dec. 18, 2012 ); --' Georgia Transmission Corporation ' ( April 10, 2012 ). Applicable Criteria and Related Research : Georgia Transmission Corp. (Revenue Bonds) Additional Disclosure Solicitation Status ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS . IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE ' WWW.FITCHRATINGS.COM '. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE. Fitch Ratings Primary Analyst Ryan A. Greene Director +1-212-908-0593 Fitch Ratings, Inc. One State Street Plaza New York, NY 10004 or Secondary Analyst Alan Spen Senior Director +1-212-908-0594 or Committee Chairperson Dennis Pidherny Managing Director +1-212-908-0738 or Media Relations: Elizabeth Fogerty , New York , +1 212-908-0526 Email: Source: Fitch Ratings

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