WEC Energy Group Inc.

Our stable outlook on WEC over the next two years reflects our expectation that management will continue to focus on its core utility operations and reach constructive regulatory outcomes to avoid heightened business risk. The outlook also reflects our base case forecast level of adjusted funds from operations (FFO) to debt averaging roughly 16% per year, in line with the current significant financial risk profile. We could lower the rating if WEC's business risk profile, which we assess as excellent, weakened. We could also lower the rating if core financial measures consistently underperformed our base case forecast and remained at less credit-supportive levels, including annual adjusted FFO to total debt of less than 15%. This could occur if rate case

...The initial response to the COVID-19 pandemic by the public service commission of Wisconsin (PSCW) is to ensure stability for WEC Energy Group Inc. (WEC) and its consumers. PSCW's direction regarding the accounting treatment utilities should use for costs incurred during Wisconsin's ongoing response to and fight against the spread of COVID-19 will ensure operational and financial stability for WEC and provide for future decisions on what costs can ultimately be recovered. These actions should result in maintaining reliable and affordable utility services, and protect consumers from future unreasonable rate increases. WEC has increased the proportion of wind generation in the fuel mix. WEC increased its planned investments in wind projects toabout $1.8 billion resulting in higher proportion of renewable generation. These investments provide a low-risk path for WEC to expand its regulated asset base as well as producing tax credits that it can use to lower the overall cost of the projects....

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