DPL --Long-term IDR to 'A-' from 'BBB+'; --Senior unsecured debt to 'A-' from 'BBB+'; --Junior subordinated debt to 'BBB+' from 'BBB'; --Short-term IDR to 'F1' from 'F2'.

DP&L

--Long-term IDR to 'A' from 'A-'; --Senior secured debt to 'AA-' from 'A+'; --Preferred stock to 'A' from 'A-'.

In addition, Fitch affirms DP&L's short-term IDR and commercial paper at 'F1'.

The Rating Outlook for both entities is Stable.

The ratings reflect the companies' strong financial metrics, further debt reductions at the parent company, a relatively low risk business profile, and approval by the Public Utilities Commission of Ohio (PUCO) of DP&L's electric security plan.

Financial metrics at both entities are robust and benefit from DP&L's low-cost operations, modest debt load, and minimal capital expenditure requirements. DPL's funds from operations (FFO) to debt ratio has improved to more than 30% following continued strong performance at the utility and further debt reductions at the parent. DPL has paid down $500 million of debt since the beginning of 2007, reducing the parent's debt balance to just over $492 million. In addition, DP&L's low capital expenditures - even when accounting for the upcoming customer conservation and energy management costs for advanced metering infrastructure and smart grid technology - should allow the utility to be self-funding over the near-term.

Fitch expects the continuation of solid credit metrics at DPL, with EBITDA interest coverage of more than 6 times (x) and FFO to debt of more than 30%. At DP&L, Fitch expects EBITDA interest coverage to remain well over 10x and FFO to debt to be greater than 40% over the near-term.

DPL benefits from a relatively low risk business profile, with a focus on the regulated utility operations at DP&L. The utility has a low cost generation fleet that is nearly 100% coal-fired, and the utility's coal needs are fully hedged for 2010. Exposure to coal is somewhat of a concern given pending federal environmental legislation, but it is likely that any costs the utility would endure as a result would be recovered in rates. DP&L completed in 2008 the installation of flue gas desulfurization equipment (scrubbers) at its Killen and Stuart generating facilities, and installation of scrubbers at the Conesville facility is scheduled to be completed before the end of this year.