AEP responds to Ohio Supreme Court IGCC Decision

Print Email Facebook Twitter
COLUMBUS, Ohio, March 14, 2008 – American Electric Power (NYSE: AEP) reaffirmed its commitment to Integrated Gasification Combined Cycle (IGCC) generation but indicated that the company will have to wait for clarity about the future of electricity generation in Ohio before it can determine if it can build an IGCC plant in the state.

“It’s disappointing that the Ohio Supreme Court decision did not provide the clarity we need to move forward with construction of an IGCC plant in Ohio. The court´s decision did clearly affirm that Ohio generation is deregulated under Senate Bill 3," said Robert Powers, president, AEP Utilities.

“We are committed to IGCC generation technology and will continue to pursue it in jurisdictions where there are conducive investment climates. We hope that the State of Ohio can resolve the path to move forward with new baseload generation, thereby bringing this technology and the associated jobs to Ohio,” Powers said.

AEP has proposed IGCC technology for use as new baseload generation in the seven-state eastern portion of its service area. The company announced in August 2004 its intent to scale up IGCC technology and build approximately 1,200 megawatts of large, commercial-scale IGCC generation. AEP recently received approval from the West Virginia Public Service Commission to build a 629-megawatt IGCC plant in West Virginia. The company proposed to build a similar 629-megawatt IGCC unit in Meigs County, Ohio.

IGCC technology converts coal into a synthetic gas that moves through pollutant-removal equipment before the gas is burned in a combined-cycle gas turbine to produce electricity. The process allows for more efficient and effective reduction and removal of sulfur dioxides, particulates and mercury from plant emissions than conventional pulverized coal technology. IGCC plants also offer the opportunity for more efficient, less costly carbon capture for permanent storage in deep geologic formations.

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.




This report made by AEP and its Registrant Subsidiaries contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Although the registrants believe that their expectations are based on reasonable assumptions, any such statements may be influenced by factors that could cause actual outcomes and results to be materially different from those projected. Among the factors that could cause actual results to differ materially from those in the forward-looking statements are: electric load and customer growth; weather conditions, including storms; available sources and costs of, and transportation for, fuels and the creditworthiness and performance of fuel suppliers and transporters; availability of generating capacity and the performance of AEP’s generating plants; AEP’s ability to recover regulatory assets and stranded costs in connection with deregulation; AEP’s ability to recover increases in fuel and other energy costs through regulated or competitive electric rates; AEP’s ability to build or acquire generating capacity (including the company’s ability to obtain any necessary regulatory approvals and permits) when needed at acceptable prices and terms and to recover those costs through applicable rate cases or competitive rates; new legislation, litigation and government regulation including requirements for reduced emissions of sulfur, nitrogen, mercury, carbon, soot or particulate matter and other substances; timing and resolution of pending and future rate cases, negotiations and other regulatory decisions (including rate or other recovery of new investments in generation, distribution and transmission service and environmental compliance); resolution of litigation (including disputes arising from the bankruptcy of Enron Corp. and related matters); AEP’s ability to constrain operation and maintenance costs; the economic climate and growth in AEP’s service territory and changes in market demand and demographic patterns; inflationary and interest rate trends; volatility in the financial markets, particularly developments affecting the availability of capital on reasonable terms and developments impairing AEP’s ability to refinance existing debt at attractive rates; AEP’s ability to develop and execute a strategy based on a view regarding prices of electricity, natural gas and other energy-related commodities; changes in the creditworthiness of the counterparties with whom AEP has contractual arrangements, including participants in the energy trading market; actions of rating agencies, including changes in the ratings of debt; volatility and changes in markets for electricity, natural gas, coal, nuclear fuel and other energy-related commodities; changes in utility regulation, including the potential for new legislation in Ohio and the allocation of costs within regional transmission organizations; accounting pronouncements periodically issued by accounting standard-setting bodies; the impact of volatility in the capital markets on the value of the investments held by AEP’s pension, other postretirement benefit plans and nuclear decommissioning trust; prices for power that AEP generates and sells at wholesale; changes in technology, particularly with respect to new, developing or alternative sources of generation; other risks and unforeseen events, including wars, the effects of terrorism (including increased security costs), embargoes and other catastrophic events.

Print Email Facebook Twitter
MEDIA CONTACT:
Melissa McHenry
Manager, Corporate Media Relations
614/716-1120

ANALYSTS CONTACT:
Julie Sherwood
Director, Investor Relations
614/716-2663