Emission allowances will have significant monetary value, and the decision about whether to allocate or auction them has enormous financial ramifications, from the smallest residential customers to the largest businesses. We believe that auctions would place an unfair cost burden on customers of utilities whose power comes from coal and would likely cause significant damage to AEP’s manufacturing customer base, possibly creating significant job losses.

We are passionate about our position supporting allocations because we have an obligation to our customers and the communities we serve. This is not about making profits for shareholders; it is about doing what’s best for our customers and the environment. In fact, because our rates are regulated, our profitability is not affected.

Some stakeholders have suggested that the government should collect money from customers and give it to companies to make required environmental improvements. Our skepticism that utilities would actually receive those funds is based on the billions of dollars cus- tomers have already paid to the federal government over many years to build a permanent nuclear waste storage facility at Yucca Mountain, which still does not exist. The projected federal budget deficit makes us even more concerned about this idea. Although we disagree fundamentally with some stakeholders on the issue of allocation versus auction, we are committed to work toward a solution.