AMERICAN ELECTRIC POWER CO INC (AEP)

American Electric Power Company, Inc. (AEP) is a public utility holding company incorporated in New York in 1906 and reorganized in 1925. It directly owns all of the common stock of its public utility subsidiaries, and its primary business is the generation, transmission and distribution of electricity. The subsidiaries have traditionally provided integrated electric service to retail customers, though restructuring laws in Michigan, Ohio and the ERCOT area of Texas have led to unbundled rates in those states. AEP itself has no employees. Its subsidiaries had 17,581 employees at December 31, 2025, and about 24% of the workforce was represented by labor unions.

AEP reports four segments: Vertically Integrated Utilities, Transmission and Distribution Utilities, AEP Transmission Holdco, and Generation & Marketing. The remaining activities are shown as Corporate and Other. The Vertically Integrated Utilities segment generates, transmits and distributes power to retail and wholesale customers through AEGCo, APCo, I&M, KGPCo, KPCo, PSO, SWEPCo and WPCo, and owned about 25,400 MWs of generation at year-end 2025. Its 2025 net generation was 43% coal and lignite, 22% natural gas, 19% nuclear and 16% renewables. The nuclear share comes from I&M's Cook Plant, whose NRC operating licenses expire in 2034 and 2037, and I&M has begun the application process for extensions. The Transmission and Distribution Utilities segment includes AEP Texas and OPCo. AEP Transmission Holdco (AEPTCo) holds the state transmission companies. AEP Service Corporation (AEPSC), a service company subsidiary with 6,994 employees, provides accounting, administrative, information systems, engineering, financial, legal, maintenance and other services at cost. It also handles marketing, generation dispatch, fuel procurement and risk management for the utility subsidiaries.

AEP's utility subsidiaries serve retail customers in portions of Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia and West Virginia. The largest subsidiary customer bases are KPCo (about 1.5 million), AEP Texas (about 1.1 million) and APCo (about 971,000). Industrial customers include petroleum and coal products, chemical, primary metal, paper and food manufacturing, oil and gas extraction, pipeline transportation, coal mining, and data processing, which is primarily data centers and cryptocurrency operations. AEP also sells power at wholesale to other utilities, rural electric cooperatives, municipalities and other market participants. Demand is seasonal and weather-driven, peaking in hot summers and in some areas cold winters. Subsidiaries operate in the PJM, SPP and ERCOT markets, and rates are set by state commissions and FERC, with authorized returns on equity of roughly 9.25% to 10.50%.

For fuel, the Vertically Integrated Utilities buy coal through long-term contracts and spot purchases, with supplier contracts in place through 2031 for part of their needs. They own, lease or control 3,009 railcars, 270 barges, 4 towboats and a coal terminal with about 18 million tons of annual capacity. In 2025 they received 19 million tons of coal at an average $54.86 per ton and consumed about 164 billion cubic feet of natural gas. Gas supply, transportation and storage are competitively bid, and PSO acquired the Green Country Power Plant on June 30, 2025. I&M buys uranium on the spot and term markets and stores spent nuclear fuel on site. The Cook Plant decommissioning trust held about $4.5 billion at year-end 2025. Subsidiaries fund operations with short-term debt, AEP's commercial paper program, term loans, receivable sales and long-term financing. They are subject to federal, state and local environmental regulation.