AEP First Utility to Receive U.S. EPA SmartwaySM Recognition for Actions to Reduce the Impact of Its Transportation Operations

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COLUMBUS, Ohio, Jan. 28, 2009 – American Electric Power (NYSE: AEP) is the first utility to be recognized as a SmartWaySM Transport partner by the U.S. Environmental Protection Agency (EPA) for the company’s efforts to reduce transportation-related greenhouse gas emissions.

Through its participation in the program, AEP has assessed the percentage of freight it ships via SmartWay carriers and measured the greenhouse gas emissions of those freight operations. The company also has committed to ship at least 50 percent of its freight, excluding fuel for its power plants, with SmartWay Transport partner carriers.

Additionally, the company will develop a three-year action plan to reduce the greenhouse gas emissions of its mobile fleet.

While the shipment of power plant fuel was not part of the assessment AEP performed for the SmartWay program, more than 90 percent of the fuel AEP ships by rail is sent via SmartWay carriers. SmartWay is not currently designed to measure barge transportation emissions, which is the mode of shipment for 28 percent of AEP’s fuel.

In December 2007, AEP began using SmartWay Partnership status as a component in evaluating and awarding shipping contracts. AEP managed the shipment of an estimated 86 million pounds of material over 49 million miles during 2008, excluding power plant fuel.

“Seeking to operate our business in more sustainable ways means looking beyond the obvious impacts that our operations can have. That includes looking at the shipping of materials in addition to the direct emissions of our fleet of 7,600 on-road vehicles and making choices to help reduce the impact of all those processes,” said Richard Munczinski, AEP senior vice president – Shared Services.

“Taking steps to reduce fuel consumption and emissions for our shipping and fleet operations and choosing suppliers who are also taking action to reduce emissions will get us closer to achieving our environmental and sustainability goals,” he said.

Through its corporate sustainability program, AEP has launched several initiatives to reduce fuel consumption and emissions from its vehicle fleet. These activities will be part of the three-year action plan that the company implements as part of the SmartWay program.

AEP operates 110 flex-fuel vehicles, 24 hybrid trucks and more than 80 hybrid cars, including three plug-in hybrid electric vehicles that the company is testing to measure performance and determine how they impact the electric system. AEP also is testing new tires that reduce truck weight and tire heat buildup. Early results have shown a 1.5 mile-per-gallon increase in fuel economy savings after the first quarter of tire usage.

In addition, AEP has purchased 800,000 gallons of biodiesel fuel since 2005 and uses an alternative fuel blend instead of regular gasoline at company-owned fueling stations. AEP also has been educating employees about fuel conservation and placed hang tags with fuel-saving tips in all company vehicles to promote smart driving.

SmartWay was initiated by the EPA in 2004 to identify products and services that reduce transportation-related emissions. The program has become a partnership between the government, businesses and consumers to protect the environment, reduce fuel consumption and improve air quality for future generations.

American Electric Power is one of the largest electric utilities in the United States, delivering electricity to more than 5 million customers in 11 states. AEP ranks among the nation’s largest generators of electricity, owning nearly 38,000 megawatts of generating capacity in the U.S. AEP also owns the nation’s largest electricity transmission system, a nearly 39,000-mile network that includes more 765-kilovolt extra-high voltage transmission lines than all other U.S. transmission systems combined. AEP’s transmission system directly or indirectly serves about 10 percent of the electricity demand in the Eastern Interconnection, the interconnected transmission system that covers 38 eastern and central U.S. states and eastern Canada, and approximately 11 percent of the electricity demand in ERCOT, the transmission system that covers much of Texas. AEP’s utility units operate as AEP Ohio, AEP Texas, Appalachian Power (in Virginia and West Virginia), AEP Appalachian Power (in Tennessee), Indiana Michigan Power, Kentucky Power, Public Service Company of Oklahoma, and Southwestern Electric Power Company (in Arkansas, Louisiana and east Texas). AEP’s headquarters are in Columbus, Ohio.

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Tammy Ridout
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