AEP Revises 2009 Ongoing Earnings Guidance, Lowers Capital Spending Plan for 2010

AEP Revises 2009 Ongoing Earnings Guidance, Lowers Capital Spending Plan for
2010

COLUMBUS, Ohio, March 30 /PRNewswire-FirstCall/ -- American Electric Power
(NYSE: AEP) has revised its 2009 ongoing earnings guidance, establishing a
guidance range of between $2.75 and $3.05 per share. The revised guidance
recognizes current operating and economic factors and reflects dilution from
the company's planned issuance of new equity.

Ongoing earnings represent earnings from continuing operations, which exclude
special or one-time items included in the earnings prepared in accordance with
Generally Accepted Accounting Principles.

The previous 2009 ongoing earnings guidance range, announced in November 2008,
was between $3.00 and $3.40 per share. The company is not providing guidance
for 2010 or beyond at this time.

"When we established a relatively wide range for 2009 guidance in November, we
committed to make a revision once we knew the outcome of the regulatory
decision on our Electricity Security Plan in Ohio and knew more about the
impact the economic downturn was having on our operations," said Michael G.
Morris, AEP's chairman, president and chief executive officer. "We received
the Ohio order March 18. Even though we anticipate filing for rehearing on
some elements of the decision, the order does significantly eliminate rate
uncertainty in a state that is home to approximately 20 percent of our more
than 5 million customers and contributes more than 30 percent of the retail
revenues from our utility operations.

"In addition to the effect of dilution from our planned stock issuance, the
ongoing economic downturn is a significant factor in our revised guidance,"
Morris said. "Retail demand for electricity, primarily from our industrial
customers, is down, which has a negative impact on earnings from our regulated
utilities. The downturn's impact is even greater on off-system sales - the
wholesale sale of power from our generating units that isn't needed to serve
our utility customers. But all companies are facing similar economic issues.
Our efficient, low-cost generation and our diverse industrial customer base
position us to resume growth as the economy recovers."

Recent rate increases in Ohio, Indiana, Oklahoma and Virginia will help offset
some of the economic impact on earnings.

Cash flow for 2009 is negatively affected by increased fuel deferrals of
approximately $360 million for the Ohio Companies and approximately $185
million for Appalachian Power. The cash flow impact of the deferrals is
somewhat offset by $300 million in bonus depreciation included in the American
Recovery and Reinvestment Act of 2009.

To address the revenue impact of the economic downturn, AEP is reducing its
capital budget for 2010 to $1.8 billion from the previous planned capital
budget of $3.4 billion. The reductions in capital spending for 2010 are spread
across AEP's utility operating companies in generation, transmission and
distribution. Discretionary projects are being deferred until the economic
climate warrants the additional investment.

The 2009 capital budget, which was reduced in October to approximately $2.6
billion from more than $3.3 billion, remains unchanged. The company intends to
keep operations and maintenance spending for 2009 and 2010 unchanged from the
2008 level of $3.4 billion.

"The reductions in our capital budget and the tight controls on operations and
maintenance spending will not affect our ability to reliably serve our
customers in the near term," Morris said.

AEP will continue construction of the John W. Turk Jr. Power Plant, a
600-megawatt coal-fueled plant in Arkansas scheduled for completion in 2012;
the J. Lamar Stall Unit, a 500-megawatt natural-gas fueled plant in Louisiana
scheduled for completion in 2010; and the carbon capture and storage project
scheduled for completion in September at the Mountaineer Plant in West
Virginia. AEP will continue pursuing necessary approvals for extra-high
voltage transmission projects under development.

"The commercialization of carbon capture and storage technology and the
development of a national extra-high voltage transmission system are
important, both for AEP and for the nation, so we will continue our leadership
in those areas," Morris said.

"The nation and our customers are facing very difficult economic times, but we
are making prudent spending decisions to protect our balance sheet, improve
our liquidity, ensure that our credit ratings remain investment grade and
maintain our access to capital markets," Morris said. "These steps will
position us to resume our growth as the economy improves."

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 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: 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 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 or contraction 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 impacting 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
markets; 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 and the impact on future funding requirements; 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.

SOURCE American Electric Power

Pat D. Hemlepp, Director, Corporate Media Relations, +1-614-716-1620; or
Analysts: Bette Jo Rozsa, Managing Director, Investor Relations,
+1-614-716-2840