The ratings for Cleco Corp. reflect the nonregulated business' generation of cash flows and risk-management efforts associated with power development projects. Cleco Power LLC, a relatively low-cost, midsize regulated electric utility serving parts of Louisiana, provides stable cash flows to the parent company. Although the utility currently accounts for 87% of Cleco's consolidated earnings (as of yearend 2001), Cleco expects its nonregulated businesses to contribute about 41% of total earnings by 2003. These nonregulated businesses include generating projects, cogeneration, energy trading and marketing, and engineering services. Cleco's consolidated credit strengths include its strategy to distribute risk with investment partners, and underpin each project with a long-term tolling agreement, rather than entering the higher-risk merchant power arena. This approach is complemented
