4/10/2006
AEP Ohio receives approval to recover IGCC pre-construction costs

COLUMBUS, Ohio, April 10, 2006 -- An order issued today by the Public Utilities Commission of Ohio (PUCO) represents an important step toward construction of a clean-coal power generation plant in Ohio, according to American Electric Power (NYSE: AEP).

The commission´s order allows AEP Ohio to recover the pre-construction costs, including the front-end engineering and design (FEED) study, for the Integrated Gasification Combined Cycle (IGCC) clean-coal plant from its Ohio customers. The order also ruled that the company will incur the costs of the IGCC plant in meeting its provider of last resort (POLR) obligation to all customers in its certified territory and that the existence of these costs makes it reasonable to recover them through a POLR recovery mechanism.

AEP Ohio will provide more definitive information, including more precise costs, when available to seek approval to recover the costs of building and operating the plant.

"We are pleased that the Ohio Commissioners have approved the pre-construction costs for the IGCC clean-coal plant and ruled that it is reasonable to recover the costs of this facility through a provider of last resort (POLR) recovery mechanism that applies to all customers," said Michael G. Morris, AEP´s chairman, president and chief executive officer. "When we return to the commission with additional information, it will be important that we receive a quick decision. We trust that the PUCO won’t allow opponents of this plant to use another set of evidentiary hearings to delay or kill the project. We face an increasingly tight construction timeline if we are to have the plant on line in 2010 to meet our POLR obligation.”

AEP Ohio, a unit of AEP, filed a cost-recovery plan for a 600-megawatt IGCC plant in Meigs County, Ohio, after the PUCO, in its January 2005 Rate Stabilization Plan order, suggested the company build an IGCC plant in the state.

AEP also has filed with the West Virginia Public Service Commission for approval of cost recovery for an IGCC plant adjacent to its Mountaineer Plant in New Haven, W.Va. The company has identified a third potential site for an IGCC plant in Lewis County, Ky.

AEP will need at least two base-load power plants early in the next decade to meet the projected growth in demand for electricity in the company’s seven-state eastern operating area. AEP has proposed IGCC generation as this base-load generation.

IGCC technology converts coal into a gas and moves it through pollutant-removal equipment before the gas is burned in gas turbines that drive electric generators. The heat produced by the gas turbines is recovered in boilers that produce steam to drive a steam turbine also coupled to an electric generator. The integrated process results in fewer emissions of nitrogen oxide, sulfur dioxide, particulates and mercury, in addition to lower carbon dioxide emissions.

AEP Ohio provides electricity to 1.4 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, and is a unit of American Electric Power.

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 is the nation’s largest generator of electricity, owning more than 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, West Virginia and 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.


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 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.

Jeff Rennie
AEP Ohio Corporate Communications
866-394-2860, or 740-594-1928

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