...Fitch Ratings downgraded the Long-Term Issuer Default Rating (IDR) of OGE Energy Corp. (OGE) to `BBB+' from `A¡' in August 2018. Fitch believes the regulatory environment in Oklahoma has become challenging, underscored by the unfavorable rate case outcomes in 2017 and 2018 and the uncertain treatment of environmental compliance investment, resulting in higher operating risks and weaker financial metrics for OGE and its only subsidiary, Oklahoma Gas and Electric (OG&E; A¡/Stable) as compared with the historical levels. Fitch expects OG&E and OGE to produce, on average, FFO-adjusted leverage ratio of approximately 4.0x and 4.2x, respectively, in the next three years, which is approximately 60bps weaker than the historical levels. OG&E's EBITDA represents approximately 75%¡80% of the total EBITDA. OGE's rating stability depends upon timely and reasonable recovery of the Sooner scrubber project (Sooner project). The outcome of the proposed rate case associated with the project will be an important...
