Distribution monopolies and very strong market position in electricity and gas supply; Robust and improving financial profile; and Flexible and low-cost generation portfolio. Small-size utility by Austrian and European comparison; Likely to face increasing regulatory pressure on system charges (network tariffs) in the medium term; and Operates in a 100% liberalized gas and electricity market. The ratings on Austria-based utility KELAG AG reflect the low business risk arising from its strong position in electricity supply and its regional electricity distribution monopoly in the Austrian State of Carinthia (AA/Stable/A-1+). Further rating strengths are KELAG's advantageous pumped-storage hydro-generation assets and its robust and improving financial profile. These strengths are offset by KELAG's small size, its operation in a fully liberalized energy market,
