... Electric Power Co.'s (SWEPCO) ratings reflect expected improvement in the utility's credit metrics in 2016¡2018, as capital investments moderate and rate increases are implemented. Fitch Ratings projects adjusted debt/EBITDAR will decline below 4.0x by 2018, compared with 4.5x at the end of first-quarter 2016. Constructive and Diverse Regulations: A balanced regulatory environment, which includes fuel cost adjustment clauses and cost riders to recover environmental regulation-related expenses, is a key driver of SWEPCO's credit profile. The three utility jurisdictions -- Arkansas, Louisiana and Texas -- provide SWEPCO with geographic and regulatory diversity. Manageable Capex: SWEPCO's capex is expected to decline to about $400 million annually in 2016¡2018, well below the $500 million invested per year in 2012¡2015. Fitch expects internally generated cash flow to be sufficient to fund the planned capex and modest dividend payments without...
