American Electric Power 2008 Corporate Sustainability Report

18 Environmental Performance we must purchase coal to meet the demand, without exclusion. We recognize the concerns about mountaintop mining and have committed to continue discussions with interested stakeholders, including Appalachian Voices, to find common ground on this issue. BEYOND OUR COAL SUPPLIERS To help us achieve our own goals, we have appointed a manager of Sustainable Supplier Development, who is organizing a process for sharing best practices among utilities that have a similar interest. We are also visiting manufacturers in China who make some of the parts for equipment that AEP buys, in order to learn more about their processes and impacts. This focus is still new to the electric industry, but we are enthusiastic about the opportunities to influence our supply chain and about the interest from our peers in collaborating with us. n Useful web links: www.epa.gov • www.usgbc.org/LEED www.greensuppliers.gov • www.wildlifehc.org For the first time, AEP is taking a hard look at what we buy – from utility poles and transformers to chemicals and office paper – to see if there are better alternatives with fewer environmental impacts. AEP was the first electric utility to join the Green Suppliers Network. By the end of 2008 we expect at least five suppliers will have completed the environmental and technical reviews; three have already signed up. Challenges, Goals, Progress { Environmental Performance } Challenge Achieving environmental compliance, preventing pollution, improving incident response and fostering positive regulatory relationships to enhance performance in an environment of complex regulations. Goal Zero enforcement actions. ISO 14001: Complete phase-in of MESH initiative by end of 2012 in all fossil and hydro power plants. Target in 2008 – seven fossil plants and 17 hydro plants begin implementation. More stringent internal targets to challenge ourselves to go beyond compliance with environmental performance by tracking measures of air quality, water quality and waste management through an internal Environmental Performance Index (EPI). Performance is tied to compensation. The EPI sets an annual target of total number of incidents for the index. 2008 EPI goal = 12 or fewer incidents at generating units: 1. Opacity – measure of visual appearance of gas exiting power plant stack and is a rough indicator of particulate emissions. 2. NPDES (National Pollutant Discharge Elimination System) permit requirements (wastewater exceptions) – a measure of water quality permit compliance. 3. Oil and chemical spills – a measure of how we respond to and manage spills. Proactive outreach with regulatory agencies. To lead by example we must improve our own use of energy, reduce or offset emissions from our mobile fleet, improve the efficiency of our facilities and infrastructure and reduce the office waste stream. Achieve 1,000 MW reduction in demand by 2012 with 15 percent coming from AEP actions, 85 percent from customer programs. Progress Number of enforcement actions: 2007 – 2 2006 – 9 2005 – 5 ISO 14001: 2007 – 12 power plants began Phase 1 implementation. 2006 – four plants began implementation. EPI set a 2007 target of 12 or fewer incidents; 11 occurred: Opacity – 1 (2006 – 0) NPDES – 7 (2006 – 9) Oil & chemical spills – 3 (2006 – 0) Ongoing outreach with regulators. Installed meters at 95 percent of our facilities to monitor energy usage. Another full year of data will be necessary to have a solid baseline, allowing us to set long-term goals. Fuel consumption 2007 – 5.6 million gallons gasoline; 4.9 million gallons diesel fuel; 283,000 gallons B20 biodiesel. Reduce AEP’s mobile fleet consumption of petroleum-based products. http://www.epa.gov http://www.usgbc.org/LEED http://www.greensuppliers.gov http://www.wildlifehc.org

Table of Contents Feed for the Digital Edition of American Electric Power 2008 Corporate Sustainability Report

American Electric Power 2008 Corporate Sustainability Report Contents Leadership, Management & Strategy A Message from Michael G. Morris A Message from Dennis E. Welch About This Report Environmental Performance Work Force Issues Public Policy Climate Change Energy Security, Reliability & Growth Stakeholder Engagement Glossary GRI Table of Contents

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