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Our Dialogue with Stakeholders

We held 10 formal stakeholder meetings during the past year, using our 2007 and 2008 Corporate Sustainability Reports or the development of this year's report as a springboard for discussions. No subject was off-limits: we talked about the future of coal and mountaintop mining, climate change policy and energy efficiency, coal ash ponds, the impact of the recession on our company, and other issues. We worked with stakeholders not only on the national level but also within the communities we serve to discuss regional and local issues of mutual concern. We included a more diverse range of customers, businesses, community organizations, environmental organizations, regulatory agencies and academic institutions than in past years. We also invited young professionals and university students to hear their unique views and ideas.

The discussions focused primarily on AEP's material issues — work force, climate change and other environmental challenges, including the growing stress on water and water supply, and energy security and reliability. We talked beyond the report about our current programs and our vision for the future. For the first time, we held some of the meetings at AEP plants and facilities to give stakeholders a closer view and understanding of our business. These meetings included tours of our Northeastern Plant in Oklahoma and the Dolan Engineering Laboratories in Ohio.

Also for the first time, we conducted a survey of stakeholders who participated in our meetings to help us identify high-priority issues and to understand their perceptions of AEP prior to and following the meetings. We worked with SustainAbility, a London-based sustainability consulting firm, to create and compile survey results and to facilitate each meeting with the highest regard for objectivity and neutrality.

Stakeholders generally gave us positive marks for our willingness to listen and to incorporate their feedback. Some stakeholders were positive about our leadership on issues such as energy policy and new technologies.

We were asked to describe with more specificity what we are doing to advance renewable energy, environmental protection and energy efficiency. Some stakeholders believe we should be doing far more, particularly when it comes to energy efficiency. Most participants understood and accepted that coal will remain an important element of AEP's fuel sources well into the future. However, most of our stakeholders generally believe that we should work harder to decrease the percentage of coal that comprises our fuel mix, eliminate use of mountaintop-mined coal, and increase renewable energy as a percentage of our fuel mix.

Stakeholders unanimously urged us to do a better job educating the general public, regulators and politicians about the value and real cost of electricity. They also asked us to be an industry leader in addressing issues such as mountaintop coal mining.

We are integrating structured stake-holder engagement into the operation of our business units. For example, Southwestern Electric Power Company hosted a meeting that modeled our approach to stakeholder engagement to discuss the company's integrated resource plan for its Arkansas customers. Members of the Arkansas Public Service Commission, the Arkansas Energy Office and the Attorney General's office participated as well as independent power producers and renewable energy project developers.

Stakeholders visit AEP’s Dolan Engineering Laboratories in Groveport, Ohio.

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