Methodology Version History
Changes between each published version of Transparency Analytics rating methodologies. Documents with only a single published version are noted but have no change log.
ABL Rating Framework
v9.9.2025 — Initial version. No subsequent versions.
Corporate Credit Rating Methodology
v10.2025 (October 2025)
Previous version: v02.2025 (February 2025)
Correction: Fixed a grammatical error in the Recovery Waterfall section. The phrase "asset-based facilities are securitizations" was corrected to "asset-based facilities and securitizations."
v02.13.2026 (February 2026)
Previous version: v10.2025 (October 2025)
Expanded instrument rating notching rules (Section VII). The prior version described notching only in general terms. The February 2026 version adds explicit rules for investment grade borrowers (ICR of BBB- or higher):
Secured debt is notched up one notch from the unsecured rating
Subordinated debt is notched down one to two notches
Preferred stock is notched down two notches
For non-investment grade borrowers (BB+ or lower), the existing recovery analysis methodology continues to apply, but this is now stated more clearly in contrast to the investment grade treatment.
Preferred stock treatment in recovery waterfall. The prior version stated simply that preferred stock without a debt claim is not included in the waterfall. The new version adds a specific notching rule for rated preferred stocks of BB+ or lower issuers: they are notched to the lower of two notches below the ICR or one notch below the lowest-rated debt tranche.
New section on preferred stock equity credit. A new subsection (added before the existing Non-Equity Shareholder Financing section, which was renamed from Section D to Section E) clarifies that preferred stock not offering creditor rights in bankruptcy and without terms enabling the holder to trigger bankruptcy generally receives 100% equity credit. An exception applies if the preferred stock has debt-like features or is expected to be redeemed with debt proceeds.
Correction carried forward: The typo from v02.2025 that was introduced in v10.2025 ("are securitizations") is corrected back to "and securitizations."
v03.05.2026 (March 2026)
Previous version: v02.13.2026 (February 2026)
Corrected Regulated Utilities financial metric thresholds. The AAA rating thresholds in the Regulated Utilities Financial Assessment table contained errors in the prior version. The FFO/Total Debt and FFO-Dividends/Total Debt thresholds were listed as upper bounds ("< 40%" and "< 35%") when they should have been lower bounds ("≥ 40%" and "≥ 35%"). These are now corrected. No other substantive changes.
Credit Tenant Lease Rating Methodology
v9.9.2025 — Initial version. No subsequent versions.
Project Finance Credit Rating Methodology
v2.19.2026 (February 2026)
Previous version: v9.9.2025 (September 2025)
This was a major update adding sector-specific guidance (Appendix B) and refining several financial assessment concepts.
New Appendix B: Sector-Specific Factors. The September 2025 version covered only the general project finance framework. February 2026 adds detailed sector-specific guidance for two project types:
Renewable Power Generation (Solar and Wind):
Added financial metric tables with DSCR thresholds for contracted and noncontracted solar and wind projects
Sector-specific financial assessment factors: resource variability (P90 methodology), curtailment risk, panel/turbine degradation, and availability rates
Solar projects are characterized as having strong business profiles; wind as in-line, reflecting higher resource variability
Construction risk: solar is particularly low risk due to modular, offsite-manufactured design; wind is modestly higher
Offtaker cap exception: renewable projects may qualify for a limited exception to the offtaker rating cap given economic and regulatory incentives for utilities to honor PPAs
Natural Gas-Fired Power Generation:
Added financial metric tables for contracted and merchant projects, including DSCR and FCF/Total Debt thresholds
Sector-specific financial assessment factors: earnings stability under contracted vs. merchant structures, spark spread and profitability analysis, and amortization/debt repayment requirements
Added a supplemental Table 14 with debt repayment prior to maturity guidelines for contracted vs. merchant projects at each rating category
Asset life assumptions for refinancing risk analysis are noted as highly circumstance-specific, with the possibility of shortened assumptions for low-efficiency plants in markets transitioning away from fossil fuels
New Financial Assessment concept: Amortization/Repayment Structure. Added a new paragraph clarifying that Low Risk projects are generally expected to fully amortize, and that higher DSCR thresholds for Medium and High Risk projects reflect lower required amortization. For non-amortizing structures, the presence and projected magnitude of excess cash flow sweeps is an important rating consideration.
Refined stress scenario description. The prior version's description of stress/breakeven scenarios was simplified: the new version removes the explicit statement that investment grade projects must be stress-tested against a "downside stress test scenario" and instead focuses on key stress variables and the 1.0x DSCR floor for investment grade projects.
Improved Cost Recovery/Availability-Based Projects language. Clarified that very high predictability of cash flows and DSCR stability (not just cash flow) is what distinguishes these projects, and that project credit quality "can be similar to the offtaker's depending on circumstances."
Minor correction: "refinance risk" changed to "refinancing risk."
v03.06.2026 (March 2026)
Previous version: v2.19.2026 (February 2026)
New sector coverage: Data Centers (Appendix B). The major addition in this version is a new Data Centers section in Appendix B, adding detailed rating guidance for data center project finance transactions. The cover page scope description was also updated to replace "industrial processing plants" with "digital infrastructure."
Key topics covered in the new Data Centers section:
Financial Assessment:
Lease Contract Profile: NNN leases (typically 10–20 years) with investment grade tenants are the strongest structure; gross leases are weaker but still strong relative to other project finance categories; colocation projects with shorter-term (1–3 year) gross lease portfolios are viewed as relatively low risk due to contracted revenues and lease stickiness
Recontracting Risk: Identified as a key credit consideration given rapid technology evolution, particularly for large single-tenant AI training facilities. A rent discount is typically assumed at recontracting, with the magnitude dependent on technical and demand characteristics. For colocation portfolios with established renewal patterns, recontracting risk is less significant
Power Costs and BYOG: Power costs are typically passed through to tenants. Projects that include on-site power generation ("bring your own generation" / BYOG) benefit from secured power availability but take on power generation credit considerations. BYOG offtake is stronger if the tenant (rather than the project entity) is the power offtaker
Capital Investment Requirements: Amount of capital needed to maintain long-run competitiveness is a key financial assessment factor, particularly in the context of recontracting risk or increasing competition (e.g. liquid cooling upgrades, power density increases)
Business Assessment:
Cash Flow Stability: High short-run stability from contracted revenues, but long-run stability depends on demand strength and technology positioning. Key factors include supply-demand balance for the target workflow category (AI training, AI inference, cloud/enterprise) and tenant diversification
Competitive Profile: Data centers benefit from high tenant switching costs and integration. Long-term positioning is supported by alignment of technical characteristics (power density, cooling, latency) with market requirements and design flexibility
Operating Performance: Generally low operational complexity since projects typically do not own or manage IT equipment. Liquid cooling systems are the most complex element. NNN lease structures may transfer operational responsibility to the tenant
Construction Phase: Generally simpler than most project types; increasingly standardized and modular designs reduce risk. BYOG increases construction complexity. Common constraints are power availability, grid interconnection, and permitting
Rating Modifiers: Refinancing risk is often intertwined with recontracting risk. Asset life assumptions are situation-specific and can be reduced significantly for facilities not viewed as strongly positioned technically or competitively
Real Estate SASB Rating Methodology
v9.9.2025 — Initial version. No subsequent versions.