...Puget Energy, Inc.'s (PE) ratings and Outlook are driven by the regulated gas and electric utility operations at Puget Sound Energy, Inc. (PSE) in Washington state. PSE's recent rate case order was materially worse than expected. Although some aspects of the order were corrected subsequently, Fitch estimates that, without any mitigating actions, PE's consolidated FFO leverage could continue to exceed the downgrade trigger of 5.5x in 2021. PE and PSE could be downgraded if mitigating actions are not forthcoming or insufficient to strengthen their credit metrics. Sustained lack of a constructive regulatory relationship will also be a catalyst for a downgrade. Other credit constraints include stringent environmental control mandates, progressive carbon-reduction goals and substantial parent-level debt....
