Columbus, Ohio, Aug. 22, 2006 – American Electric Power (NYSE: AEP) and its operating unit Indiana Michigan Power (I&M) have entered into a 20-year agreement with Wabash Valley Power Association (Wabash) to provide wholesale power to serve Wabash’s member cooperatives. The agreement, upon approval by the Federal Energy Regulatory Commission (FERC), will take effect Jan. 1, 2007.
"Wabash desired a solution from a reliable power supplier for their long-term power supply needs,” said Greg Hall, AEP vice president, energy marketing. “By working together, we were able to develop a contract that benefits both parties.”
"This agreement reaffirms the long-term relationship that I&M has had with Wabash," said Marsha P. Ryan, I&M president and chief operating officer. “We’re pleased to continue to provide wholesale electricity to meet the energy needs of their customers.”
"The large and diverse generation fleet of AEP and I&M will provide further long-term price stability to our members’ power supply costs," explained Rick Coons, president and chief executive officer for Wabash Valley Power Association. “Our partnership with I&M goes back many years, and we’re pleased to see it continue well into the future.”
AEP is one of the nation’s largest wholesale suppliers of generation to municipal utilities and cooperatives. The company currently provides approximately 3,275 MW of power to 55 municipal utilities and 25 electric cooperatives in the United States.
Wabash Valley Power is a generation and transmission cooperative based in Indianapolis that provides wholesale electricity to 28 distribution cooperatives and their nearly 800,000 retail members throughout Indiana, Illinois, Michigan, Missouri and Ohio.
Indiana Michigan Power (I&M) is headquartered in Fort Wayne, Ind., and its 2,650 employees serve more than 580,000 customers in Indiana and Michigan. I&M operates 3,595 megawatts (MW) of coal-fired generation in Indiana, 2,110 MW of nuclear generation in Michigan, and 22 MW of hydro generation in both states.
I&M is an operating unit of American Electric Power, 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 36,000 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 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). American Electric Power, based in Columbus, Ohio, is celebrating its 100th anniversary in 2006.
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This report made by AEP and certain of its 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: electric load and customer growth; weather conditions, including storms; available sources and costs of, and transportation for, fuels and the creditworthiness of fuel suppliers and transporters; availability of generating capacity and the performance of AEP’s generating plants; the ability to recover regulatory assets and stranded costs in connection with deregulation; the ability to recover increases in fuel and other energy costs through regulated or competitive electric rates; new legislation, litigation and government regulation including requirements for reduced emissions of sulfur, nitrogen, mercury, carbon and other substances; timing and resolution of pending and future rate cases, negotiations and other regulatory decisions (including rate or other recovery for new investments, transmission service and environmental compliance);resolution of litigation (including pending Clean Air Act enforcement actions and disputes arising from the bankruptcy of Enron Corp.); AEP´s ability to constrain its operation and maintenance costs; AEP´s ability to sell assets at acceptable prices and on other acceptable terms, including rights to share in earnings derived from the assets subsequent to their sale; the economic climate and growth in AEP´s service territory and changes in market demand and demographic patterns; inflationary and interest rate trends; 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; changes in the financial markets, particularly those affecting the availability of capital and AEP´s ability to refinance existing debt at attractive rates; actions of rating agencies, including changes in the ratings of debt; volatility and changes in markets for electricity, natural gas, and other energy-related commodities; changes in utility regulation, including membership in regional transmission structures; accounting pronouncements periodically issued by accounting standard-setting bodies; the performance of AEP´s pension and other postretirement benefit plans; prices for power that AEP generates and sells at wholesale; changes in technology, particularly with respect to new, developing or alternative sources of generation, and other risks and unforeseen events, including wars, the effects of terrorism (including increased security costs), embargoes and other catastrophic events.
Melissa McHenry
Manager, Corporate Media Relations
614/716-1120