The 2015 outlook for thermal, renewable and oil and gas projects is stable, according to a Fitch Ratings report.
'The dramatic shift in prospects for North America's natural gas supply continues to have a profound impact,' said Greg Remec, Senior Director. 'The forecast for abundant gas supply at low prices has spurred activity across North America for new gas liquefaction export facilities. Abundant gas reserves and increasing production are expected to keep prices near current levels in the near term, though falling oil prices could reduce associated gas production if oil production is curtailed.'

Fitch's thermal power portfolio is largely protected from volatile market prices by fixed-price tolling agreements that also mitigate fuel price risk. Evolving emissions regulations may accelerate the planned retirement of smaller and older coal plants, leading to increased reliance on more efficient and cleaner gas plants in the longer term.

Renewable projects benefit from long-term revenue contracts, though some are without fixed pricing, leaving projects exposed to volatility in market prices. Projects with sufficient contractual protections against price and volume risks should remain stable over the long term.

Oil and gas projects are supported by contractual protections, parent guarantees, and strong market positions. Expectations for continuing low natural gas prices underpin the development of numerous commodity and export projects, and near-term stability will depend on sufficient completion risk mitigation. Currently lower oil price levels may reduce production and demand for pipeline capacity but are not expected to negatively impact projects with contracted pricing.
Source: Fitch Ratings