Fitch Upgrades Philadelphia Gas Works’ Bond Rating to ‘A’
Posted on: Sep 03, 2025This upgrade is the first time in the company’s 189-year history all three rating agencies have rated its bonds in the ‘A’ category.
PHILADELPHIA (September 3, 2025) – At the close of PGW’s fiscal year, Fitch Ratings upgraded its rating on Philadelphia Gas Works Revenue Bonds to ‘A’ from ‘A-’ and assigned a Stable outlook. This is the second Philadelphia Gas Works (PGW) upgrade by Fitch in two years, and PGW now has its highest ever combination of credit ratings.
PGW’s bonds are now rated in the ‘A’ category by all three rating agencies. In addition to the Fitch ‘A’ rating, Moody’s Investors Service and Standard & Poor’s Global Ratings maintain Stable outlooks and ratings of ‘A3’ and ‘A’, respectively on PGW’s outstanding bonds. In general, higher credit ratings can result in lower borrowing costs as investors view those securities as less risky.
Fitch cited PGW’s “sustained strong financial performance”, sufficient liquidity, and effective management in its rating report. Fitch noted that PGW effectively manages distribution, and supply costs and uses flexible and revenue-neutral rate mechanisms to respond to lower demand and stabilize its finances when needed
The upgrade further reflects rate relief that PGW is expected to receive beginning in FY 2026. PGW recently filed a $62 million Joint Petition for Settlement in its base rate case. The settlement and related Administrative Law Judge recommendation will be reviewed by the PUC in November.
“We appreciate the confidence Fitch has demonstrated in PGW by increasing our bond rating outlook from ‘A-’ to ‘A’,” said Seth Shapiro, President & CEO, PGW. “The rating upgrade is an encouraging endorsement of PGW’s leadership team performance and the dedicated service of our entire workforce. PGW’s ability to constantly improve our operational excellence and grow revenue directly benefits our customers,” he said.
The ratings agency also credited PGW’s “strong revenue source characteristics and a stable demand profile, including a stable service territory with improving economic and demographic indicators.”
“The recent upgrade to ‘A’ is a major accomplishment and a testament to the continued hard work of PGW’s management team,” said City Treasurer Jacqueline Dunn regarding the Fitch action.
There are approximately $1.1 billion of outstanding gas works revenue bonds (Senior 1998 general ordinance) that are secured by the revenues of PGW in addition to a debt service reserve fund.
Read the full rating report HERE.
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