The ratings on Empresa Electrica del Norte Grande S.A. (Edelnor) reflect a weak financial profile partly offset by Edelnor's diversified generation base, ownership of transmission assets (a competitive advantage), and its 21% equity stake in the Gasoducto Norandino pipeline, which provides a stable cash flow stream. Edelnor operates in the Northern Interconnected System (SING), where about 40% of the nearly 2,600 MW of installed generation depends on natural gas (considering dispatch restrictions to natural gas-fired units). The need to burn coal or fuel oil as a result of natural gas supply shortages to gas-fired power plants and the system's oversupply when natural gas is available (peak demand reached 1,428 MW in 2003) subjects Edelnor to spot-price volatility, which affects about
