On Dec. 2, 2008, Standard&Poor's Ratings Services raised Tucson Electric Power Co.'s (TEP) corporate credit rating to 'BB+' from 'BB'. At the same time, the secured ratings were raised to 'BBB+' from 'BBB' and the unsecured notes were raised to 'BBB- from 'BB+'. The respective recovery ratings of '1+' and '2' remain unchanged. The outlook is stable. The upgrades reflect the Arizona Corporation Commission's (ACC) approval of TEP's rate case settlement, with modifications. With this order, TEP's generation operations are re-regulated, which should allow the company to better match revenues with expenses. The order provides for an estimated 6% increase in retail base rates that should allow the company to stabilize cash flows at modestly stronger levels and,
