Insulating

FERC’s proposed rule to limit intra-corporate cash transfers, although a step in the right direction, does not provide a regulated energy subsidiary with a sufficient amount of “insulation” from its cash-strapped parent company to justify awarding the regulated entity a separate credit rating, according to Standard and Poor’s (S&P) credit analyst Todd Shipman. Even if it did provide the insulation, the Commission’s past record of “sluggish response” doesn’t instill much confidence that the agency will actively enforce the rule, he said last week.