American Electric Power 2008 Corporate Sustainability Report

2008 Corporate Sustainability Report 55 Challenge for a national interstate EHV transmission system versus a series of short - term local fixes. Goal within NIETC designation. Build transmission infrastructure to support longrange reliability and development of new technology and renewable generation, like the Competitive Renewable Energy Zones (CREZ) in the Electric Reliability Council of Texas (ERCOT). Build coalition of public support from industry, trade groups, NGOs, policymakers and others to demonstrate need and support for EHV interstate transmission system. Progress AEP announced Electric Transmission Texas (ETT), a joint venture with MidAmerican Energy Holdings Co., in November 2007. An additional approximately 1,000 - mile, high-voltage, high-capacity backbone transmission system proposed to state regulators and the ERCOT. The first two stages of the proposed infrastructure would reinforce the ERCOT transmission grid, providing access for up to 10 GW of existing and planned renewable energy projects in north and central West Texas. AEP announced another joint venture with MidAmerican, Electric Transmission America (ETA). ETA will be a 50 - 50 partnership identifying and investing in high-voltage transmission projects (345kV or higher) located in North America, outside of ERCOT. Through ETA, the companies intend to invest in transmission projects with a cost of at least $100 million or more. AEP and General Electric Co. agreed to jointly develop and deploy equipment and technology programs. Launched comprehensive gridSMARTSM initiative to coordinate technology and program development. Ordered three two-megawatt NAS batteries for deployment in 2008. Identified locations where the batteries can be demonstrated. Committed to 2008 customer education campaign on energy usage through Clinton Global Initiative. Offered DSM programs in several states. To delay the need for new generation, consumers must change how they use electricity and reduce their demand for it. Giving them the tools and information to make informed decisions about how and when to use electricity requires new technologies combined with traditional energy efficiency programs. The challenges include regulatory support for this strategy and educating consumers about the value of electricity to affect their usage. gridSMARTSM initiative provides the platform to develop and deploy new technology, develop cost-effective energy efficiency programs and allow AEP to operate more efficiently, creating fewer emissions. These changes also position AEP to better manage new technologies such as PHEVs. Achieve full regulatory support to allow deployment of 5 million smart meters by 2015. In 2008 we plan to complete implementation of a 10,000-meter gridSMARTSM pilot project in the South Bend, Ind., area, file a multi-year Advanced Meter Infrastructure deployment plan in Texas and obtain regulatory approval to demonstrate the benefits of gridSMARTSM technologies in two model city deployments. Reduce or offset 1,000 MW demand through energy efficiency programs by 2012, with 15 percent to come from AEP and 85 percent to come from customer programs. Increase diversity of fuel portfolio to reduce percentage of generation that relies on coal to make electricity. Having a diverse energy portfolio is critical to a secure energy future and strengthens the nation’s ability to reduce its reliance on foreign energy sources. In addition, coal is becoming more of a global commodity, forcing us to compete internationally for it. Add 1,000 MW of wind power by 2011. Added 12 natural gas units in 2007 with total capacity of 2,020 MW. Signed power purchase agreements for 275 MW of wind; 75 MW online in December 2007. Remainder to come online in 2008. The Donald C. Cook Nuclear Plant implemented process and efficiency improvements to ensure its long-term operation. Both units received 20-year license extensions. Keep nuclear power in the fuel diversity and climate change discussions as a carbon emission-free generation source. Energy Security, Reliability & Growth Deploy 25 MW of NAS battery storage by the end of 2010, with 6 MW installed in 2008.

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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