American Electric Power 2008 Corporate Sustainability Report

2008 Corporate Sustainability Report 3 tions and to call for international public policies to promote them. This WBCSD report was presented to leaders from more than a dozen countries at the United Nations’ international climate negotiations in Bali, Indonesia. For AEP’s part, we are working to bring advanced coal technologies, including carbon capture and storage, ultrasupercritical pulverized coal and Integrated Gasification Combined Cycle (IGCC) to commercial operation. We are pleased that the West Virginia Public Service Commission recently approved our proposed 629-MW IGCC plant, a decision that recognizes the importance of this technology to our future energy security. We hope for a similar decision from the Virginia State Corporation Commission. We are disappointed that a recent decision of the Ohio Supreme Court on our proposed IGCC plant rejected a PUCOapproved mechanism for timely recovery of future costs of the project. We remain hopeful we can resolve this issue. Meanwhile, we will complete a validation project for carbon capture at our Mountaineer Plant in West Virginia in 2009. We plan to have the equipment and permits we need this year to drill the underground wells that will permanently store the carbon dioxide. We also received some approvals for one of our advanced clean-coal plants – the Turk Plant in Arkansas – but, unfortunately, Oklahoma rejected the other. We were disappointed with the Department of Energy’s (DOE) decision to end its funding of the FutureGen project – the first near-zero emissions coal power plant. The DOE has restructured the FutureGen project funding, giving us an opportunity to receive funds to support our carbon capture and storage initiatives, and we are pursuing that option. Electricity production is only part of the equation. It is critical to harness new sources such as wind, biomass and solar and to have the ability to deliver electricity across state and regional boundaries to where it is most needed. We believe an extra-high voltage interstate transmission system regulated at the federal level, similar to natural gas pipelines, is in the nation’s best interest. The existing transmission system simply cannot meet the growing demand for energy, including energy efficiency and renewable energy. We envision an enhanced electric distribution system, giving our customers far more control and choice over their electricity, much like they now decide which mobile phone plan to buy. Freedom of choice will be an enormous benefit to our customers, enabling them to reduce consumption, conThis distribution system, part of our gridSMARTSM initiative, will also provide data to improve service reliability, increase efficiencies on our system and reduce customer outage times. Our agreement with the General Electric Co. to deploy equipment and technology programs is an important component of our plan to supply our 5.2 million customers with “smart meters” by 2015 to give them the information needed to control their electricity use. We continue to be challenged by an aging work force: 18 percent of our employees are eligible to retire today and 10 percent of our employees are likely to do so in the next four years. This is significant because it takes years to train employees to operate power plants or work on the electric transmission and distribution system. Our employees have shared their concerns about this challenge and we are working to provide more information about our plans. We must continue to have a stable, diverse, knowledgeable and motivated work force in the future in order to meet our business goals. We see a world in which energy transmission is facilitated and climate change is addressed; a world in which electricity is created from more diverse and cleaner sources and used more efficiently with far more control in the hands of users. We see a senior management team and work force that is prepared and eager to lead this change, with the ability and commitment to make it happen. Working with others, we have the power and the talent to make it happen. Thank you for your interest in American Electric Power. Sincerely, Leadership, Management & Strategy trol costs and limit their individual environmental impacts. Michael G. Morris Chairman, President & Chief Executive Officer

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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