Balanced and progressive plan demonstrates "AEP's Commitment to Ohio's
Future"
COLUMBUS, Ohio, July 31 /PRNewswire-FirstCall/ -- Though faced with the
skyrocketing cost of conventional fuels and infrastructure costs to keep
the system up and running, AEP Ohio, a unit of American Electric Power
(NYSE: AEP), today filed its Electric Security Plan (ESP) with the Public
Utility Commission of Ohio (PUCO), a comprehensive plan that invests in the
future while holding rate increases to approximately 15 percent annually
for the next three years.
In addition, the plan provides the framework of "AEP's Commitment to
Ohio's Future", a plan that exceeds State requirements in purchasing and
supplying renewable power (solar, wind and other renewable fuels);
contributes $75 million of shareholder money to aid struggling Ohio bill
payers; and positions the company to become a strong partner in the State's
efforts to retain and attract new businesses and new jobs for Ohio.
If approved by the PUCO, AEP Ohio's ESP will keep rates well below
current market rates, as well as regional and national market rates, and
will continue to keep AEP Ohio's rates within the lowest rates in the
state.
"In these troubling economic times for Ohio families, we recognize that
any electric rate increase will draw frustration, anger and criticism.
Fortunately, by using all the tools provided by the Governor and the
Legislature, we are able to design a new energy plan that will allow us to
continue providing reliable, affordable and cleaner electricity in Ohio,
while at the same time allowing us to devise a critical, economic
development plan that will help turnaround Ohio," said Michael Morris, AEP
chairman, president and chief executive officer.
"Our customers already struggle to meet skyrocketing spikes in health
care costs, a near doubling of food costs and most significantly,
dramatically escalating fuel costs of all kinds," said Joe Hamrock, AEP
Ohio president and chief operating officer. "Global demand for our primary
fuel, coal, mirrors what Ohio families have seen in oil. China, alone, is
building a new coal plant somewhere in the country every week. The fact is
that coal has doubled in cost in the last year alone dramatically affecting
AEP Ohio's costs. The tools given to us by the State's new energy plan
allow us to phase in those fuel price increases over time so that unlike
the spikes Ohioans see in so many products, AEP Ohio's rate increases are
spread out to be made more affordable.
"The AEP Ohio filing is based almost entirely on recovering increased
costs and modernizing our facilities to keep them reliable," said Hamrock.
" As we partner with the state on our " AEP's Commitment to Ohio's Future"
plan we expect to facilitate energy efficiency and purchase wind, solar and
other renewables, thereby delaying the need for additional rate increases
to build new baseload plants. That would be an enormous achievement as
these new sources of electricity would reduce our carbon footprint."
For the average Columbus Southern Power residential customer using
1,000 kilowatthours (kWh) per month, approval of the plan would result in
an increase in a customer's total monthly bill of approximately $16 in
2009. For the average Ohio Power residential customer using 1,000 kWh per
month, approval of the plan would result in an increase in a customer's
total monthly bill of approximately $12 in 2009.
AEP's Commitment to Ohio's Future plan proposes the following planks:
Renewable Energy-A Critical Priority to Moving Ohio Forward
-- By the year 2011, purchase up to 300 megawatts (3 percent of AEP
Ohio's capacity) from wind and other alternative fuels. This doubles the
benchmarks established by the new Ohio energy law and will help accelerate
the State's priority of creating 20,000 new jobs in the energy
manufacturing field. This contributes to meeting an AEP-wide commitment to
supplying an additional 1000 megawatts of wind power (more than enough to
serve the homes of the residents of a city the size of Columbus, Ohio).
-- Fully develop the application of commercial-scale fuel cells in
partnership with Rolls Royce at its Ohio operations.
-- Work with the State school systems to implement, promote and meet a
new goal of providing solar ready equipment under the jurisdiction of the
Ohio School Facilities Commission.
Energy Efficiency (EE)-the Cleanest, Safest and Most Affordable Energy
Source
-- Launch a highly visible energy efficiency program including
deployment of advanced technologies such as smart meters to help Ohio
families save money.
-- Establish Energy Efficiency Collaborative (EEC) involving diverse
stakeholders to assist AEP Ohio in the speedy development and deployment of
efficiency programs.
-- Continue to integrate into its fleet US-made hybrid vehicles and
introduce plug-in hybrid electric vehicles as they become available.
-- AEP Ohio customers can take immediate action to help reduce the
impact of electricity price increases by reducing their electricity
consumption. Tips for cutting electricity use are available on the AEP Ohio
website at http://www.aepohio.com .
Helping Ohio Families
-- Provide shareholder contributions of $75 million to help support
Ohio families who need assistance in paying their electric bills.
-- Develop targeted education and weatherization programs to help low
income families.
AEP Ohio provides electricity to nearly 1.5 million customers of major
AEP subsidiaries Columbus Southern Power Company and Ohio Power Company in
Ohio, and Wheeling Power Company in the northern panhandle of West
Virginia. AEP Ohio is based in Gahanna, Ohio. The company serves all or
part of 61 counties in Ohio and two in West Virginia.
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 more than 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 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 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
(including the costs of projects that are canceled) 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 implementation of
the recently passed utility law 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.
SOURCE AEP Ohio
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Related links:
http://www.aep.com
http://www.aepohio.com
http://www.prnewswire.com/comp/042050.html /
CONTACT:
Terri Flora, Director, Corporate
Communications of AEP Ohio, +1-614-883-6675
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