AEP Ohio Meets Goal of New Ohio Energy Law by Filing Electric Security Plan Below...

AEP Ohio Meets Goal of New Ohio Energy Law by Filing Electric Security Plan
Below Market Rates; Continues Lowest Rates in the State
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
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

Terri Flora, Director, Corporate Communications of AEP Ohio, +1-614-883-6675