AEP Ohio's PPA key ingredient for modernizing Ohio's electricity system

Plan aligns with key pillars outlined by leader of the Public Utilities Commission of Ohio

GAHANNA, Ohio, Feb. 19, 2016 -- The collaborative Power Purchase Agreement (PPA) signed by AEP Ohio, a unit of American Electric Power (NYSE: AEP), and other key stakeholders strongly supports key pillars discussed by the Honorable Andre Porter, chair of the Public Utilities Commission of Ohio, during the Ohio Energy Management Conference in Columbus Wednesday.

            Chairman Porter outlined three pillars Feb. 17 that he called a “recipe” for modernizing the grid and helping face the new realities of today. These pillars included:

  1. Resource Adequacy is Best Served from a Diverse Set of Energy Resources
  2. Engaging Customers
  3. Embracing Technology

            “The agreement we reached with a number of diverse stakeholders aligns well with Chairman Porter’s vision for Ohio’s energy future and will help make Ohio successful on the energy front,” said Pablo Vegas, AEP Ohio president and chief operating officer. “For 18 months, we worked with important Ohio companies and constituents to develop a comprehensive plan that will ensure more stable electricity prices for Ohio consumers and a diverse generation supply to support Ohio’s economy.”

            In December 2015, more than 11 parties, including the PUCO staff, Sierra Club, Ohio Partners for Affordable Energy, Ohio Energy Group, Ohio Hospital Association, Mid-Atlantic Renewable Energy Coalition, as well as three competitive retail energy suppliers, signed a stipulated agreement in support of AEP Ohio’s expanded PPA that is designed to provide Ohio customers with more stable future electric rates and support local economies.

            If approved as filed, AEP Ohio’s plan will continue to provide Ohio with diverse, reliable generation resources. The company will make environmental improvements to AEP-owned coal-fueled generating units, including the conversion of some units to co-fire natural gas. In addition, AEP Ohio committed to adding at least 900 megawatts of wind and solar energy in Ohio over the next five years.

            AEP Ohio’s plan also includes support of energy efficiency programs and new grid modernization technologies, including smart meters, distribution automation and Volt-VAR optimization, that will help customers become more engaged in the use of electricity in their homes and businesses. The plan also includes support for development of energy storage and battery technologies.

            “The vocal critics of this plan care about short-term profits and want to force power plants to retire prematurely so they can financially benefit," Vegas said. "Their claim that this plan will increase bills for customers is false. This plan provides long-term support for Ohio’s energy and economic future while supporting local jobs and communities."

            When approved, AEP Ohio has shown that customers will save money immediately, receiving a $4 million credit during the first year of the plan. In aggregate, AEP Ohio expects the plan to save customers $721 million over the next eight years.

            “Power prices are at record lows today, but in a marketplace, we know electricity prices can and have been volatile," Vegas said. "This plan will help mitigate the impact of future price increases by providing rate stability and smoothing out market price spikes and dips, while still allowing customers to shop for their electricity provider.”

            For more information about AEP Ohio’s plan, go to AEPOhio.com/AEPOhioPlan

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               AEP Ohio provides electricity to nearly 1.5 million customers of major AEP subsidiary Ohio Power Company in Ohio. AEP Ohio is based in Gahanna, Ohio, and is a unit of American Electric Power. News and information about AEP Ohio can be found at AEPOhio.com.

               American Electric Power is one of the largest electric utilities in the United States, delivering electricity to nearly 5.4 million customers through 223,000 miles of distribution lines in 11 states. AEP 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 also ranks among the nation’s largest generators of electricity, owning approximately 32,000 megawatts of generating capacity in the U.S. 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 Ohio Media Relations
1-866-641-1151 or 614-883-7999

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