N EWS R ELEASE

October 23, 2014

• Third-quarter 2014 GAAP and operating earnings $1.01 per share
• Infrastructure investment continues to support earnings growth
• 2014 operating earnings guidance range narrowed to $3.40 to $3.50 per share from $3.35 to $3.55 per share

AMERICAN ELECTRIC POWER

Preliminary, unaudited results

COLUMBUS, Ohio, Oct. 23, 2014 – American Electric Power (NYSE: AEP) today reported third-quarter 2014 earnings, prepared in accordance with Generally Accepted Accounting Principles (GAAP), of $493 million or $1.01 per share, compared with $0.89 per share or $433 million in third-quarter 2013, an increase of 13 percent in earnings per share.

Operating earnings (GAAP earnings excluding special items) for third-quarter 2014 were the same as GAAP earnings of $493 million or $1.01 per share, compared with third-quarter 2013 operating earnings of $1.10 per share or $533 million.

A full reconciliation of 2014 and 2013 GAAP earnings with operating earnings for the quarter and year to date is included in tables at the end of this news release.

"Our solid operational and financial performance in the third quarter reflects the ongoing, steady success of our regulated earnings growth strategy. Our third-quarter 2014 operating results are down compared with 2013, due to the mild summer and our plan to accelerate spending and shift costs from future years into 2014. However, year-to-date operating results are strong. AEP's Board of Directors voted earlier this week to increase our quarterly dividend by 3 cents to 53 cents per share, a 6 percent boost for our shareholders on an annual basis," said Nicholas K. Akins, AEP chairman, president and chief executive officer.

"We continue to see some economic improvement in the states where we operate, primarily in areas with shale gas operations. Excluding the 2013 closure of our largest industrial customer, overall industrial sales increased nearly 5 percent in the third quarter, marking the fourth consecutive quarter with positive industrial sales growth. Commercial sales increased slightly for the fifth consecutive quarter, while residential sales growth continues to lag," Akins said.

"Our infrastructure investments, both at our operating companies and through our transmission business, continue to contribute to earnings. AEP Transmission Holding Co.'s net plant assets are now approximately $2.4 billion, an increase of 83 percent from the same period last year. Year to date, AEP Transmission Holding Co. has increased earnings by 12 cents per share, and we expect to realize earnings per share of approximately 30 cents from this business for the year," Akins said.

EARNINGS GUIDANCE

Management narrowed its 2014 operating earnings guidance range to $3.40 to $3.50 per share from $3.35 to $3.55 per share. In providing operating earnings guidance, there could be differences between operating earnings and GAAP earnings for matters such as, but not limited to, impairments or changes in accounting principles. AEP management is not able to estimate the impact, if any, on GAAP earnings of these items. Therefore, AEP is not able to provide a corresponding GAAP equivalent for earnings guidance.

SUMMARY OF RESULTS BY SEGMENT

$ in millions

Operating earnings from Vertically Integrated Utilities for third-quarter 2014 decreased $54 million compared with the same period in 2013. This reflects the impact of shifting costs from future years primarily related to plant maintenance and forestry expenses, as well as the impact of cooler temperatures across most of AEP's service territory.

Operating earnings from Transmission & Distribution Utilities for third-quarter 2014 decreased $27 million compared with the same period in 2013, including a regulatory provision recorded in the third quarter of 2014.

Operating earnings from AEP Transmission Holdco for third-quarter 2014 increased $21 million compared with the same period in 2013, largely from increased investment.

Operating earnings from Generation & Marketing for third-quarter 2014 increased $5 million compared with the same period in 2013, primarily due to increased margins.

Operating earnings from AEP River Operations for third-quarter 2014 increased $12 million compared with the same period in 2013, mainly driven by improvements in barge freight demand.

OPERATING MARGIN FROM VERTICALLY INTEGRATED UTILITIES

$ in millions

Retail and FERC Margins – Retail and FERC margins for third-quarter 2014 were $23 million higher than for the same period in 2013, largely from the continuing impact of favorable rate decisions, partially offset by a decrease in weather-related electricity usage.

Off-System Sales – Margins from off-system sales increased $15 million in third-quarter 2014 compared with third-quarter 2013, mainly driven by lower margin sharing.

OPERATING MARGIN FROM TRANSMISSION & DISTRIBUTION UTILITIES

$ in millions

Retail and FERC Margins – Retail and FERC margins for third-quarter 2014 were $24 million higher than for the same period in 2013, largely from the continuing impact of favorable rate decisions.

Transmission Revenue – Transmission revenues were $12 million higher in third-quarter 2014 compared with the same period in the prior year, primarily due to increased transmission revenues from Ohio customers who switched to alternative Competitive Retail Electric Service providers and increased transmission investment.

OPERATING MARGIN FROM GENERATION & MARKETING

$ in millions

Generation & Marketing – Generation & Marketing margins increased $19 million in third-quarter 2014 compared with the same period in the prior year due to decreased fuel prices and favorable hedging activity.

SELECT OTHER OPERATING EXPENSES

The following expense categories within the Vertically Integrated Utilities segment had significant fluctuations in 2014 compared with 2013 (dollars in millions):

Operations and Maintenance expenses in third-quarter 2014 for the Vertically Integrated Utilities segment were $91 million higher compared with the same period in 2013, mainly driven by increases in transmission expenses and generation maintenance expenses.

Depreciation and Amortization expenses for the third-quarter 2014 for the Vertically Integrated Utilities segment increased by $24 million compared with the same period in 2013, primarily because of increases in the depreciable base.

The following expense categories within the Transmission & Distribution Utilities segment had significant fluctuations in 2014 compared with 2013 (dollars in millions):

Operations and Maintenance expenses in third-quarter 2014 for the Transmission & Distribution Utilities segment were $75 million higher compared with the same period in 2013, primarily due to increases in transmission expenses recovered dollar-for-dollar in rate recovery riders/trackers.

Depreciation and Amortization expenses for the third-quarter 2014 for the Transmission & Distribution Utilities segment increased by $17 million compared with the same period in 2013, mainly from increases in amortization related to Ohio and Texas securitizations as well as increases in the depreciable base.

WEBCAST

American Electric Power's quarterly conference call with financial analysts and investors will be broadcast live over the Internet at 9 a.m. EDT today at http://www.aep.com/webcasts. The webcast will include audio of the conference call and visuals of charts and graphics referred to by AEP management during the call. The charts and graphics will be available for download at http://www.aep.com/webcasts.

The call will be archived on http://www.aep.com/webcasts for those unable to listen during the live webcast. Archived calls also are available as podcasts.

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American Electric Power is one of the largest electric utilities in the United States, delivering electricity to more than 5.3 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 more than 40,000-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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AEP's earnings are prepared in accordance with accounting principles generally accepted in the United States and represent the company's earnings as reported to the Securities and Exchange Commission. The company's operating earnings, or GAAP earnings adjusted for certain items as described in the news release and charts, provide another representation of the company's performance. AEP uses operating earnings as the primary performance measurement when communicating with analysts and investors regarding its earnings outlook and results. The company also uses operating earnings data internally to measure performance against budget and to report to AEP's Board of Directors.

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• Full news release and supplemental tables
• Investors Presentation
• Supplemental PDFs

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This report made by American Electric Power and its Registrant Subsidiaries contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Although AEP and each of its Registrant Subsidiaries 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: the economic climate, growth or contraction within and changes in market demand and demographic patterns in AEP's service territory; inflationary or deflationary 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 finance new capital projects and refinance existing debt at attractive rates; the availability and cost of funds to finance working capital and capital needs, particularly during periods when the time lag between incurring costs and recovery is long and the costs are material; electric load, customer growth and the impact of retail competition; weather conditions, including storms and drought conditions, and AEP's ability to recover significant storm restoration costs; available sources and costs of, and transportation for, fuels and the creditworthiness and performance of fuel suppliers and transporters; availability of necessary generating capacity and the performance of AEP's generating plants; 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 and transmission lines and facilities (including the ability to obtain any necessary regulatory approvals and permits) when needed at acceptable prices and terms and to recover those costs; new legislation, litigation and government regulation, including oversight of nuclear generation, energy commodity trading and new or heightened requirements for reduced emissions of sulfur, nitrogen, mercury, carbon, soot or particulate matter and other substances, or additional regulation of fly ash and similar combustion products that could impact the continued operation, cost recovery, and/or profitability of AEP's generation plants and related assets; evolving public perception of the risks associated with fuels used before, during and after the generation of electricity, including nuclear fuel; a reduction in the federal statutory tax rate that could result in an accelerated return of deferred federal income taxes to customers; 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; AEP's ability to constrain operation and maintenance costs; AEP's ability to develop and execute a strategy based on a view regarding prices of electricity and other energy-related commodities; prices and demand for power that AEP generates and sells at wholesale; changes in technology, particularly with respect to new, developing, alternative or distributed sources of generation; AEP's ability to recover through rates or market prices any remaining unrecovered investment in generating units that may be retired before the end of their previously projected useful lives; volatility and changes in markets for capacity and electricity, coal, and other energy-related commodities, particularly changes in the price of natural gas; changes in utility regulation and the allocation of costs within regional transmission organizations, including ERCOT, PJM and SPP; the transition to market for generation in Ohio, including the implementation of ESPs; AEP's ability to successfully and profitably manage its separate competitive generation assets; 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 AEP debt; the impact of volatility in the capital markets on the value of the investments held by AEP's pension, other postretirement benefit plans, captive insurance entity and nuclear decommissioning trust and the impact of such volatility on future funding requirements; accounting pronouncements periodically issued by accounting standard-setting bodies; and other risks and unforeseen events, including wars, the effects of terrorism (including increased security costs), embargoes, cyber security threats and other catastrophic events.

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