Regulated electric and gas utility operations; Low-cost coal-fired generation that is sufficient to meet the majority of its retail loads, resulting in limited exposure to natural gas volatility and stable operating costs; The absence of significant new generation investment (Tucson Electric Power Co. (TEP) does not need to add significant resources in the near term); Cash flows sufficient to self-fund the bulk of capital expenditures; and Fuel and purchased power adjustment mechanisms for TEP, UNS Gas, and UNS Electric, which protect consolidated cash flows. Above-average debt to capital, relative to the sector, of 74%; A general rate freeze at the company in place through 2012 that implies that it is unable to flow any significant expenditures through to customers, although
