AEP to Detail 2013 Business Plans, Strategy to Support 4 to 6 Percent Operating Earnings Growth

    AEP to Detail 2013 Business Plans, Strategy to Support 4 to 6 Percent
                          Operating Earnings Growth

Company announces increase in its dividend payout ratio

PR Newswire

COLUMBUS, Ohio, Feb. 15, 2013

COLUMBUS, Ohio, Feb. 15, 2013 /PRNewswire/ --American Electric Power (NYSE:
AEP) will discuss fourth-quarter and 2012 earnings results, the company's 2013
business plan, expected capital investment and its growth strategy during a
meeting today with investors in New York.

The company established its operating earnings guidance range (earnings
excluding special items) for 2013 of $3.05 to $3.25 per share and a 2014
operating earnings guidance range of $3.15 to $3.45 per share supported by an
earnings growth rate of 4 percent to 6 percent. AEP affirmed a 2013 capital
budget of $3.6 billion. Capital expenditures for 2014 and 2015 are estimated
at $3.8 billion per year.

In providing operating earnings guidance, there could be differences between
operating earnings and Generally Accepted Accounting Principles (GAAP)
earnings for matters such as changes in accounting principles. AEP management
is not able to estimate the impact, if any, on GAAP earnings of these items,
and therefore is not able to provide a corresponding GAAP equivalent for
earnings guidance.

"We resolved significant regulatory and financial challenges in 2012 and are
well-positioned to execute on our strategy to grow earnings," said Nicholas K.
Akins, AEP's president and chief executive officer. "The dedication of our
employees and our continued discipline around controlling costs allowed us to
deliver a total shareholder return of 8.22 percent in 2012, including
dividends. To continue rewarding our shareholders and achieve payout ratios
consistent with our regulated peers, we are increasing the targeted range for
our dividend payout ratio to 60 to 70 percent of consolidated earnings.

"Our increased dividend payout ratio is fully supported by our regulated
operations, which will remain the core of our business and will drive our
earnings growth. AEP employees remain focused on our primary objective –
safely generating and delivering reliable, affordable power for the benefit of
our customers," Akins said. "I'm extraordinarily proud that our employees
completed 2012 with no fatalities and record-low injury rates, while
maintaining effective cost controls."

The company's strategy to increase transmission investment is improving the
bottom line, according to Akins. Through 2012, AEP invested approximately
$1.04 billion in its transcos and transmission joint ventures. In 2012, the
transcos and transmission joint ventures contributed $0.09 per share to
earnings. This contribution is expected to triple by 2014.

"With resolution of Ohio regulatory uncertainty, we are moving forward to
restructure our business in the state and create two sustainable businesses
from our Ohio assets: a competitive generation company and a regulated wires
company. We expect to fully separate the Ohio generation from the Ohio utility
assets at the end of 2013. Following this separation, 86 percent of AEP assets
will remain regulated," Akins said.

AEP filed with the Federal Energy Regulatory Commission in October 2012 for
corporate separation of its Ohio generating assets and transfer of those
assets to its competitive generating entity and other operating companies.

AEP continued the transformation of its generating fleet, bringing nearly
1,200 megawatts of new, highly efficient generation on line in 2012. The
company completed construction of the 580-megawatt combined-cycle natural gas
Dresden Plant in February 2012 and completed the 600-megawatt John W. Turk Jr.
Plant in December 2012. Turk is the first ultra-supercritical coal-fueled
power plant in the United States.

According to Akins, AEP has a strong balance sheet and a stable credit
outlook. The company's long-term capital plan is supported by cash flows and
financial discipline without an anticipated need for equity financing beyond
the company's existing dividend reinvestment plan and employee purchases of
company stock through the 401K plans.

"We strengthened our financial profile in 2012 and are in a good position to
support our growth strategy. We took advantage of available, low-priced debt
capital and redeemed all of our long-term parent debt, replacing it with new
long-term debt at more attractive rates that will save an expected $30 million
a year in both 2013 and 2014," Akins said. "We also reduced our
post-employment benefit liability by $460 million through modest changes to
our post-retirement medical benefits.

"To ensure that our resources are aligned with our strategy, we took a hard
look at all aspects of our organization in 2012 and adjusted our structure and
cost profile to improve the efficiency of our operations; optimize our
investments in our regulated operations; and better support our investments in
transmission, the transformation of our generation fleet, and the transition
of our business in Ohio. We will continue to put in place the improvements
identified through this process in the months ahead. We expect to keep
operations and maintenance expenses essentially flat in 2013, while allowing
for necessary investments in new operations, employee-related expenses and
general inflationary increases," Akins said.

The meeting with investors, which begins at 8 a.m. EST, will be webcast live
at The webcast also will be available after the live

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 and north
Texas). AEP's headquarters are in Columbus, Ohio. News releases and other
information about AEP can be found at 

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: the economic climate, growth, or
contraction within and changes in market demand and demographic patterns in
AEP's service territory; inflationary or deflationary 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 finance new capital projects and refinance existing debt at
attractive rates; the availability and cost of funds to finance working
capital and capital needs, particularly during periods when the time lag
between incurring costs and recovery is long and the costs are material;
electric load, customer growth and the impact of retail competition,
particularly in Ohio; weather conditions, including storms and drought
conditions, and AEP's ability to recover significant storm restoration costs
through applicable rate mechanisms; available sources and costs of, and
transportation for, fuels and the creditworthiness and performance of fuel
suppliers and transporters; availability of necessary generating capacity and
the performance of AEP's generating plants; 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 and transmission
lines and facilities (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 cancelled)
through applicable rate cases or competitive rates; new legislation,
litigation and government regulation, including oversight of nuclear
generation, energy commodity trading and new or heightened requirements for
reduced emissions of sulfur, nitrogen, mercury, carbon, soot or particulate
matter and other substances or additional regulation of fly ash and similar
combustion products that could impact the continued operation and cost
recovery of AEP's plants and related assets; evolving public perception of the
risks associated with fuels used before, during and after the generation of
electricity, including nuclear fuel; a reduction in the federal statutory tax
rate that could result in an accelerated return of deferred federal income
taxes to customers; 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; AEP's ability to constrain
operation and maintenance costs; AEP's ability to develop and execute a
strategy based on a view regarding prices of electricity, coal, natural gas
and other energy-related commodities; prices and demand for power that AEP
generates and sells at wholesale; changes in technology, particularly with
respect to new, developing or alternative sources of generation; AEP's ability
to recover through rates or market prices any remaining unrecovered investment
in generating units that may be retired before the end of their previously
projected useful lives; volatility and changes in markets for electricity,
coal, natural gas and other energy-related commodities; changes in utility
regulation, including the implementation of Electric Security Plans and the
transition to market and expected legal separation for generation in Ohio and
the allocation of costs within regional transmission organizations, including
PJM and SPP; AEP's ability to successfully manage negotiations with
stakeholders and obtain regulatory approval to terminate the Interconnection
Agreement; 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 AEP
debt; the impact of volatility in the capital markets on the value of the
investments held by AEP's pension, other postretirement benefit plans, captive
insurance entity and nuclear decommissioning trust and the impact on future
funding requirements; accounting pronouncements periodically issued by
accounting standard-setting bodies; and other risks and unforeseen events,
including wars, the effects of terrorism (including increased security costs),
embargoes, cyber security threats and other catastrophic events.

SOURCE American Electric Power

Contact: MEDIA: Melissa McHenry, Director, External Communications,
+1-614-716-1120; ANALYSTS: Bette Jo Rozsa, Managing Director, Investor
Relations, +1-614-716-2840
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