American Electric Power : 2026 Impact Report (2026 AEP Impact Report)

Published: 2026-05-12 17:07:16 ET AEP

Published on 05/12/2026 at 05:07 pm EDT

2206 AMERIC AN ELEC TRIC P OWER ' S 2 0 2 6 IMP A C T REP OR T

Through Customer-Driven, Balanced Decisions

1 8

5 8

ABOUT THIS REPOR T

CUST OMER SER VICE

GO VERNANCE

BO ARD OF DIREC T ORS ' ST A TEMENT

AEP Ohio

59 Board Oversight

AEP Texas

59 Ethics & Compliance

Appalachian Power

59 Political Engagement

Indiana Michigan Power

ABOUT AEP

Message from AEP's Chairman, President & CEO

Growth Strategy

Service Territory

AEP's Mission, Vision & Core Principles

1 0

OPER A TIONAL EX CELLENCE

Building a Reliable & Resilient Grid

Mitigating Physical Risks

16 Resource Adequacy

17 GHG Emissions

17 Enterprise Security

35 Kentucky Power

6 0

SUPPLEMENT AL DISCL O SURE

38 Public Service Company of Oklahoma

41 Southwestern Electric Power Company

6 0

CL O SING

4 5

EMPL O YEE C OMMITMENT

47 Safety & Health

48 Workforce Planning & Development

50 Culture

5 1

ENVIR ONMENT AL RESPEC T

52 Environmental Compliance

53 Biodiversity

56 Water Use & Management

56 Waste Management

Some of the information contained or incorporated by reference in this report are forward-looking statements. These forward-looking statements may be identified by words such as "expect," "anticipate," "intend," "plan," "believe," "will," "should," "could," "would," "project," "continue" and

similar expressions, and include statements reflecting future results or guidance and statements of outlook. These matters are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Forward-looking statements in this document are presented as of the date of this document. Except to the extent required by applicable law, management undertakes no obligation to update or revise any forward-looking statement. Among the factors that could

cause actual results to differ materially from those in the forward-looking statements are:

Changes in economic conditions, electric market demand and demographic patterns in AEP's service territory.

The economic impact of increased global conflicts and trade tensions, and the adoption or expansion of economic sanctions, tariffs, trade restrictions or changes in trade policy.

Inflationary or deflationary interest rate trends.

New legislation or regulations adopted in the states in which we operate or federal legislation or regulations adopted that alters the regulatory framework or that prevents the timely recovery of costs and investments.

Volatility and disruptions in financial markets precipitated by any cause, including fiscal and monetary policy or instability in the banking industry; particularly developments affecting the availability or cost of capital to finance new capital projects and refinance existing debt.

The availability and cost of funds to finance working capital and capital needs, particularly (a) if expected sources of capital such as proceeds from the sale of tax credits and anticipated securitizations do not materialize or do not materialize at the level anticipated, and (b) during periods when the time lag between incurring costs and recovery is long and the costs are material.

Changing demand for electricity, including large load contractual commitments.

The risks and uncertainties associated with wildfires, including damages caused by wildfires, the extent of each Registrant's liability in connection with wildfires,

investigations and outcomes associated with legal proceedings, demands or similar

actions, inability to recover wildfire costs through insurance or through rates and the impact on financial condition and the reputation of each Registrant.

The impact of extreme weather conditions, natural disasters and catastrophic events such as storms, hurricanes, wildfires and drought conditions that pose significant risks including potential litigation and the inability to recover significant damages and restoration costs incurred.

Limitations or restrictions on the amounts and types of insurance available to cover losses that might arise in connection with natural disasters, wildfires or operations.

The cost of fuel and its transportation, the creditworthiness and performance of parties who supply and transport fuel and the cost of storing and disposing of used fuel, including coal ash and SNF.

The availability of fuel and necessary generation capacity and the performance of generation plants.

The ability to recover fuel and other energy costs through regulated or competitive electric rates.

The ability to plan for, develop, construct, acquire, or integrate a broad range of generation and energy storage resources, as well as related transmission and distribution infrastructure, including obtaining necessary regulatory approvals, permits, and incentives; complying with cost caps and other regulatory or contractual requirements; and recovering associated costs and earning an appropriate return while meeting reliability, affordability, environmental, and customer-service obligations.

The disruption of AEP's business operations due to impacts of economic or market conditions, costs of compliance with potential government regulations, electricity usage, supply chain issues, customers, service providers, vendors and suppliers caused by natural disasters or other events.

Construction and development risks associated with the completion of the 2026-2030 capital investment plan, including shortages or delays in labor, materials, equipment or parts.

Prolonged or recurring U.S. federal government shutdowns could adversely affect AEP's operations, regulatory approvals, financial performance and could cause volatility in the capital markets which may interrupt our access to capital.

New legislation, litigation or government regulation, including changes to tax laws and regulations, oversight of nuclear generation, evolving environmental standards, energy commodity trading and new or modified requirements related to emissions of sulfur, nitrogen, mercury, carbon, soot or PM and other substances that could impact the continued operation, cost recovery and/or profitability of generation plants and

related assets.

The impact of tax legislation or associated Department of Treasury guidance, including potential changes to existing tax incentives, on capital plans, results of operations, financial condition, cash flows or credit ratings.

The risks before, during and after generation of electricity associated with the fuels used or the by-products and wastes of such fuels, including coal ash and SNF.

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 or regulatory proceedings or investigations.

The ability to efficiently manage and recover operation, maintenance and development project costs.

Prices and demand for power generated and sold in wholesale markets.

Changes in technology, including new, developing, alternative or distributed sources of generation and energy storage.

The ability to recover through rates any remaining unrecovered investment in generation units that may be retired before the end of their previously projected useful lives.

Volatility and changes in markets for coal and other energy-related commodities, particularly changes in the price of natural gas.

The impact of changing expectations and demands of customers, regulators, investors and stakeholders, including development, adoption, and use of AI by us, our customers and our third party vendors and evolving expectations related to sustainability.

Customer affordability considerations may impact regulatory recovery outcomes and future rate design.

Changes in utility regulation, policies, methodologies for evaluating and approving load interconnection, and the allocation of costs within RTOs including ERCOT, PJM and SPP and the impacts of potential market changes within those RTOs.

Changes in the creditworthiness of the counterparties with contractual arrangements, including participants in the energy trading market.

Actions of rating agencies, including changes in ratings impacting the cost of debt.

Geopolitical developments continue to create uncertainty in global energy markets and have contributed to increased volatility in fuel supply and pricing. Shifts in global market conditions and broader supply-chain pressures may influence natural gas prices, power-generation economics and customer demand patterns.

The impact of volatility in the capital markets on the value of the investments held by the pension, OPEB and nuclear decommissioning trust funds and a captive insurance entity and the impact of such volatility on future funding requirements.

Accounting standards periodically issued by accounting standard-setting bodies.

The ability to successfully defend against cybersecurity threats.

Other risks and unforeseen events, including wars and military conflicts, the effects of terrorism (including increased security costs), embargoes, labor strikes impacting material supply chains, global information technology disruptions and other catastrophic events.

The ability to attract and retain the requisite work force and key personnel, including senior management.

We are pleased to share the latest update on American Electric Power's performance, strategy, and impact -celebrating 20 years of disclosure.

Formerly the Corporate Sustainability Report, our newly titled

2026 Impact Report underscores the growing importance of balanced outcomes aligned with our mission, vision and core principles, while reflecting an enduring commitment to transparency, accountability, and long-term value creation. The topics addressed are guided by the issues that matter most to AEP and our stakeholders. Unless otherwise noted, the information presented reflects AEP's activities and performance

for the 2025 calendar year. In addition to this Report, we also publish supplemental reports and metrics based on guidance from voluntary reporting standards and industry efforts.

Please visit the AEP Sustainability page to accessthese resources

Internal Assurance

AEP's internal auditors performed a targeted review of selected performance statements and disclosures within AEP's 2026 Impact Report. Financial information was reconciled with AEP's audited financial statements and other sources as deemed appropriate. Nonfinancial statements were substantiated with press releases, internal communications, or source data from the business units. Forward-looking information is consistent with public information disclosed by AEP. Based upon our limited scope review, we believe the performance information contained within the report is appropriately stated and that management followed the established processes in accumulating the financial and non-financial information.

AEP's management team and Board of Directors recognize that safe, sustainable, and responsible business practices are fundamental to delivering long-term value and advancing the interests of all stakeholders.

Guided by our mission to put customers first and our vision to improve lives through reliable, affordable power, AEP operates with purpose and discipline. Our six core principles - customer service, employee

commitment, environmental respect, regulatory and legislative integrity, operational excellence, and financial strength - serve as the foundation for alignment, disciplined decision making, and accountability across the

enterprise to ensure we deliver balanced outcomes to all our stakeholders.

The Board of Directors has entrusted oversight of AEP's sustainability disclosure to the Nominating and Governance Committee (the Committee), which as of May 1, 2026 become the Nominating, Governance and Compensation Committee. This oversight includes this 2026 Impact Report (the Report), which reflects both our forward-looking strategic commitments and a transparent assessment of our performance to date. Through meaningful engagement and clear, consistent disclosure, the Committee seeks to strengthen stakeholder trust and reinforce AEP's ability to drive sustainable growth and enduring value. Stakeholders

have expressed confidence in, and appreciation for, AEP's leadership and accountability under this approach.

The Committee believes this Report provides a clear and comprehensive view of AEP's strategy, priorities, and performance. The Board remains steadfast in its expectation that management will be evaluated on its ability to execute AEP's strategic plan in alignment with our vision and core principles - ensuring that purpose, performance, and accountability advance together.

Center: Bare-handing 345kV Conductor

Sara Martinez Tucker

Lead Director of the Board

Sandra Beach Lin

Chair of the Nominating & Governance Committee

About AEP

Operational Excellence

Customer Service Employee Commitment Environmental Respect

Governance

JUMP T O SEC TION

Message from AEP's Chairman, President & CEO

Growth Strategy

Service Territory

AEP's Mission, Vision & Core Principles

OUR VISION

Put the customer first.

OUR MISSION

Improving customers' lives with reliable,

affordable power.

Dear AEP Stakeholders,

At American Electric Power, we are leading through one

About AEP

Operational Excellence

Customer Service Employee Commitment Environmental Respect

Governance

of the most extraordinary chapters in our company's history - and in the evolution of the electric power industry.

Accelerating electrification, rapid expansion of advanced manufacturing and data centers, and rising expectations for reliability and affordability are reshaping how energy is produced, delivered, and used. In 2025, AEP rose to meet this moment - laying the groundwork for enduring value for our customers, communities, and stakeholders.

Across our 11-state service territory, we are experiencing unprecedented growth in electricity demand, particularly in Texas, Ohio, Indiana, and Oklahoma. Today, AEP has signed nearly 63 gigawatts (GW) of firm, contracted incremental load backed by signed customer agreements. This remarkable momentum underscores both the strength of the regions

we serve and the responsibility we carry. In response, we are investing thoughtfully and at scale to modernize the grid, expand transmission, and ensure new load is served reliably, equitably, and efficiently.

In 2025, we partnered closely with federal and state leaders to accelerate reforms that streamline the interconnection of new energy resources and ensure large customers bear the costs associated with their growth. At the same time, we are advancing a broad portfolio of generation solutions to support this growth. In 2025, AEP operating companies acquired 2.2 GW of new generation resources. Additionally, in early 2026, we acquired an 870-MW natural gas fueled facility - together providing near-term capacity in high-growth regions. We also secured more than 10 GW of gas turbine capacity from leading manufacturers and strengthened strategic partnerships that reinforce AEP's industry-leading 765 kilovolt

transmission capabilities. Together, these efforts help ensure access to critical equipment, materials, and skilled labor in a highly constrained global supply environment.

Looking further ahead, we are pursuing a diverse set of generation and technology solutions to meet rising demand while managing long-term risk. This includes continued progress in advanced nuclear technologies, such as small modular reactors, and contracted generation solutions, like fuel cells, that can be deployed quickly to meet customer needs. Every opportunity is evaluated through a disciplined lens of safety, affordability, risk mitigation, and long-term value creation.

Underlying all of this work is our unwavering commitment to disciplined execution and financial strength. In 2025, AEP delivered strong operational and financial performance while advancing a strategic, well-planned capital program designed to support a modern, resilient grid.

Equally important, we continued to engage closely with communities, policymakers, customers, and employees to ensure growth aligns with local priorities and delivers shared, lasting benefits.

None of this progress would be possible without the dedication of our employees and their deep-rooted culture of safety and accountability and unwavering commitment to our customers. In 2025, AEP team members across our operating companies demonstrated what it means to put safety and customers first - every task, every day. This commitment was exemplified when several of our frontline employees went above and beyond the call of duty through heroic life-saving acts, such as pulling

a woman and child from an overturned car and rescuing a woman

from a partially submerged SUV during severe flooding. Their training, teamwork, and readiness, matched by genuine compassion, set a powerful example of service that inspires us all.

Tragically, we experienced a workplace fatality involving one of our employees in 2025. As CEO, the safety of our people is my highest priority, and the loss of a team member is deeply personal and unacceptable. We owe it to our employees, their loved ones, and every member of our team to learn from this devastating event and take decisive action to strengthen protections across our company and for all who work alongside AEP.

Our employees are striving to set high standards, hold themselves and one another accountable, and carry out their work with integrity

and respect for the communities we serve. I am incredibly proud of what our team accomplished in 2025 and deeply grateful for their dedication. While there is still much work ahead, I am confident in our path forward. The pace of change across our industry will continue to accelerate, but with a clear strategy, a strong balance sheet, unmatched infrastructure assets, and an experienced team focused on accountability and results, AEP is well positioned to deliver for our customers, our communities, and our shareholders.

Sincerely,

Bill Fehrman

Chairman, President & Chief Executive Officer

American Electric Power

About AEP

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Executing Our Strategy

GR OW TH

We are strategically positioned to invest in high-growth opportunities that drive financial performance.

CUS T OMERS

By leveraging our size and scale, we are securing critical resources to meet rising demand across our system.

P AR TNERSHIPS

We are deepening relationships with regulators, policymakers, customers and suppliers to advance system affordability, reliability and resiliency across our service territories.

Positioned for Growth

As customer needs evolve, scale, innovation and intense focus on execution will define the next generation of utility growth. AEP is well positioned to capture this growth and deliver long-term opportunity for the communities we serve.

Load Growth

BETWEEN 2026-2030

Building Capacity for What's Ahead

AEP is proactively building the capacity needed to support accelerating demand and long-term growth.

Generation Fleet

Hydro, Wind, Solar & Storage

Nuclear Natural Gas

Energy Efficiency/ Demand Response

Coal

~41 G W • 65%

Texas

G IG AWAT T S

Affordability Levers

INCREMENTAL LOAD GROWTH

DATA CENTER & LARGE LOAD TARIFFS DISCIPLINED COST MANAGEMENT SECURITIZATION

U.S. DEPARTMENT OF ENERGY LOAN GUARANTEES

EFFICIENT FINANCING

Residential Rate Impact

As we invest to meet rapidly growing load expectations, affordability remains top of mind. Large load supports affordability with residential rates projected to increase ~3.5%1 annually on a system average over the forecasted period. We are forecasting up to

$16B of cost offsets for existing customers

from our current large-load contracts2.

19%

33%

Capital Forecast

70%

Y E A R 2005

Y E A R 2035

45%

15%

BETWEEN 2026-2030

31% G E N E R AT I O N

5% OT H E R

Projected Resource Needs

BETWEEN 2026-20351

NAMEPLATE MW2 SOLAR WIND STORAGE NAT. GAS3 TOTAL

~12 G W • 19%

Ohio

REGIONAL BREAKDOWN

CUS TOMER IMP ACT

Appalachian Power

1,926

605

252

3,071

5,854

Indiana Michigan Power

2,959

3,100

6,690

12,799

Kentucky Power

450

Public Service Company of Oklahoma

893

753

200

1,975

3,821

Southwestern Electric Power Company

600

598

3,113

4,311

TOTA L S

6,738

5,056

502

15,299

27,235

Distribution $17B

1 Based on certain regulatory allocation assumptions.

2 ESA contracts within vertically integrated utilities. Through allocated contributions to fixed expenses over the life of the agreements.

$78B

TOTAL

~5 G W • 8%

Oklahoma

42% T R A N SM I SSI O N

Holdco

~3 G W • 4%

Indiana

Louisiana ~1 G W • 2%

Virginia ~1 G W • 2%

1 Resource additions are from Integrated Resource Plans (IRP) filings based on current regulations; alternative forms of generation may be added based on specific customer requests.

2 Investments in new generation resources will be subject to market availability of economic projects, regulatory preferences and approvals, and RTO capacity requirements.

3 Natural gas additions may include peaking units and fuel switching to provide reliable, affordable and flexible power.

About AEP

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OPER A TING C OMP ANIES

17,581 Employees

A CROSS THE S Y S TEM

5.6M Customers

A CROSS ELEVEN S T A TES

40K Transmission Miles

NA TION ' S L ARGES T TRANSMISSION S Y S TEM

225K Distribution Miles

ONE OF THE L ARGES T DIS TRIBUTION

S Y S T E M S I N T H E U.S.

31 GW Owned Generation

DIVERSE GENERA TION FLEET

$114B Total Assets

S TRONG BAL ANCE SHEET

‌About AEP

Operational Excellence

Customer Service Employee Commitment Environmental Respect

Governance

At AEP, our purpose is rooted in an unwavering commitment to our customers.

We strive to deliver best-in-class service by living our vision and core principles every day - championing exceptional customer experiences, investing in our people, advancing environmental respect, upholding regulatory and legislative integrity, and pursuing operational excellence and financial strength.

These principles do more than guide our decisions; they shape our culture, inspire our priorities, and define how we create lasting value. Through our company-wide balanced scorecard, we align and elevate performance across every principle, equally emphasizing operational and financial excellence to drive continuous improvement year after year. This disciplined, holistic approach enables us to deliver meaningful outcomes for our customers, build enduring value for our shareholders, and create alignment and accountability for our employees.

MISSION & VISION C ORE PRINCIPLES

OUR MISSION

Put the customer first.

OUR VISION

Improving customers' lives with reliable, affordable power.

CUS TOMER SER VICE

Industry-best customer experience.

EMPL O YEE

COMMITMENT

Safe & secure workplace.

Engaged & developed employees.

ENVIRONMENT AL RESPECT

Creative sustainable solutions.

REGUL A TOR Y &

LEGISL A TIVE INTEGRITY

Balanced regulatory outcomes.

Trusted industry leadership.

OPERA TIONAL EX CELLENCE

World-class asset

performance.

FINANCIAL S TRENGTH

Strong financial discipline.

About AEP

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JUMP T O SEC TION

Building a Reliable & Resilient Grid

Mitigating Physical Risks

Resource Adequacy

GHG Emissions

Enterprise Security

C ORE PRINCIPLE

Operational Excellence

World-class asset performance.

Operational Excellence is fundamental to delivering the safe, reliable service our customers depend on every day.

This commitment extends across our entire system - generation, transmission, and distribution - where we focus on operating assets efficiently, securely, and cost-effectively. Investing in grid reliability and resilience is essential to ensuring a stable, secure, and sustainable energy future.

As energy demand significantly increases, extreme weather events grow more frequent, electrification accelerates across industries, and customer energy expectations evolve, the grid faces unprecedented stress. Strengthening infrastructure, integrating advanced technologies, and improving system flexibility not only contribute to preventing costly outages but also support economic growth, enhance community safety, and enable the transition to diverse energy resources. By prioritizing reliability and resilience today, we build an electrical grid capable of meeting tomorrow's needs with confidence and continuity.

About AEP

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Left: Results Engineering department, 1943 • Right: PSO engineers, 2026

About AEP

TR ANSMISSION DEVEL OPMENT

The Key to Economic Growth & Customer Affordability

Operational Excellence

Customer Service Employee Commitment Environmental Respect Governance

AEP is focused on building a more reliable, resilient, and future ready grid through strategic investment, region specific risk management, regulatory partnerships, and innovation in operations and technology.

AEP's commitment to infrastructure modernization is central to its reliability and growth strategy. Of AEP's five year, $78 billion capital investment plan, $50 billion, or 64%, is dedicated to strengthening and modernizing the transmission and distribution system. These investments target aging assets, anticipated load growth, reliability concerns, cyber and physical security needs, and the deployment of advanced operational technologies.

Transmission will continue to serve as a strategic investment as we look to quickly and reliably bring on new generation to serve large loads while keeping rates affordable. In addition to building new transmission lines, AEP is also prioritizing replacements and upgrades such as rebuilding lines, replacing conductors, substation expansions, voltage improvements, and targeted greenfield development. These decisions are guided by condition-based assessments, performance data, and risk models that help determine where investment will deliver the greatest grid resilience benefits. Annual network vulnerability assessments - aligned with the North American Electric Reliability Corporation (NERC) and regional transmission organization (RTO) standards - inform system planning and help identify future expansion opportunities.

Simultaneously, distribution system enhancements are improving reliability at the customer level. Grid modernization investments support outage reduction, accelerated restoration capabilities, automation technologies, and asset-health monitoring. Customer and stakeholder engagement is integrated into this planning process, ensuring our grid evolution supports economic development, growth readiness, and community needs.

Customer cost and affordability remain top of mind as we deliver on our capital plan. The AEP team looks for creative solutions and opportunities to reduce customer bill impacts, including strategic partnerships and financing opportunities. For example, in October 2025, AEP Transmission secured a $1.6 billion Department of Energy loan guarantee at a preferred interest rate to upgrade nearly 5,000 miles of transmission lines across Indiana, Michigan, Ohio, Oklahoma, and West Virginia. The upgrades supported by this financing will replace existing lines within current rights-of-ways with higher capacity infrastructure - strengthening system reliability, supporting economic growth, and expanding power delivery in the communities AEP serves. The favorable loan terms are expected to save customers about $275 million over the life of the loan, benefits that customers will realize through lower costs in their bills. Additionally, AEP estimates the upgrades will create approximately 1,100 construction jobs.

In addition, AEP is focused on delivering greater efficiency, constructability, and certainty as we execute our $78 billion capital plan to meet growing customer demand. In November 2025, we announced long-term

strategic agreements with Quanta Services, Inc. to support high-voltage transmission development, strengthen supply chain resilience, and expand manufacturing capacity for critical equipment such as large transformers and breakers. The partnership agreements combine AEP's deep operational and development expertise with Quanta's proven track record of large-scale project execution, improving cost predictability, enhancing delivery certainty, and providing an established operational structure.

‌TR ANSMISSION

Unmatched Scale & Expertise

AEP owns and operates nearly 90% of the nation's 765 kV network with more than 2,100 miles in service and 30 substations across six states. We pioneered the modern 765 kV transmission system in North America, the highest voltage used in the U.S., bringing over 60 years of expertise in design, construction, and operation. In fact, many of today's industry standards and practices for 765 kV transmission were developed by AEP. A single 765 kV line can move six times more energy than a 345 kV line and uses less than half the total land area needed to deliver the same amount of power.

AEP and Transource Energy LLC - a partnership between AEP and Evergy focused on the development and investment in competitive electric transmission projects across the U.S. - recently announced new 765 kV transmission projects across our service territory and beyond, including:

A roughly 300-mile line in AEP Texas - one of ERCOT's first 765 kV transmission lines - as part of the Howard Solstice transmission line project. The project is one of three new 765 kV lines designed to enhance power import capability, reliability, and efficiency for communities and the expanding oil and gas sector in west Texas.

A nearly 200-mile, 765 kV line in Wisconsin - a joint venture between Transource Energy and Berkshire Hathaway Energy (BHE) Transmission. Midcontinent Grid Solutions, a 50/50 joint venture between Transource and BHE Transmission, will make a $1.2 billion investment in this critical infrastructure to enhance reliability,

strengthen the grid, and support growing energy demand all within the Midcontinent Independent System Operator (MISO) footprint.

Approximately 300 miles of new 765 kV lines and upgrades to several substations in central Ohio through the recently formed Grid Growth Ventures, LLC - a partnership between Transource Energy and FirstEnergy Transmission, LLC. This collaboration will leverage the companies' collective expertise and resources to deliver comprehensive and cost-effective solutions that address the region's growing power needs.

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Electric utility companies are increasingly prioritizing efforts to address physical risks to the grid as extreme weather events, natural disasters, and infrastructure vulnerabilities such as physical attacks, grow more frequent and severe.

At AEP, we are strengthening poles, wires, and substations with more resilient materials, modernizing aging equipment, and deploying technologies that help prevent outages and speed restoration in the face of hazards like storms, wildfires, and flooding. We are also adopting advanced monitoring systems, weatherization strategies, and predictive analytics to better anticipate damage and manage system stress during physical threats, as we focus on proactive grid hardening and long term resilience planning.

A Regionally Informed, Localized Approach

AEP's expansive geographic footprint - spanning states with dramatically different weather patterns and terrain - requires a tailored, region-specific approach to grid reliability and resiliency. From extreme heat, hurricanes, and wildfire risk in Texas to high-wind events and tornadoes in Oklahoma and heavy rainfall, snow, and ice across the Appalachian region, each area we serve faces distinct physical challenges. We begin by understanding these diverse risks and respond through localized strategies that integrate weather patterns, historical system performance, and insights from frontline operations teams. Anchored in risk-based planning, targeted infrastructure investment, and close collaboration with regulators, communities, and industry partners, this approach ensures our resilience efforts reflect on-the-ground realities, strengthen the grid, keep customers connected, and support long-term system performance across our service territory.

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Wildfire Mitigation

As wildfire risks intensify across the U.S., AEP is taking proactive steps to reduce the potential for utility-related ignition across high-risk regions in our service territory. This includes updating our enterprise-wide Wildfire Mitigation Plan to meet evolving regulatory requirements - particularly Texas' HB 145, which mandates Commission approval of utility wildfire mitigation measures. The plan takes a holistic, data-driven view of wildfire risk, incorporating real-time National Oceanic and Atmospheric Administration and National Weather Service data, asset condition assessments, and vegetation trends.

WINTER S T ORM FERN

A Real-World Test of Grid Resilience

Winter Storm Fern, which swept across much of the United States in January 2026, served as a powerful real-world test of the electric grid under extreme conditions. Prolonged sub-freezing temperatures, heavy snow, and widespread ice placed sustained stress on generation, transmission, and distribution systems across the South, Midwest, Ohio Valley, and Northeast, while driving record electricity demand as heating needs surged. Although more than one million customers experienced outages - primarily from ice-laden trees and downed lines - most regional grids avoided widespread system failure. This performance reflected years of thoughtful planning, targeted investment, and enhanced operational coordination implemented since earlier extreme weather events.

The storm underscored the value of ongoing utility investments designed to reduce physical, weather-related risks and strengthen grid resilience. Continued grid hardening, proactive vegetation management, enhanced weatherization, and robust emergency preparedness all played a critical role in maintaining system integrity under severe conditions. Equally important was the contribution of a diversified,

fuel-secure generation fleet. Dispatchable resources such as coal and nuclear units provided essential reliability when demand peaked and while renewable generation faced temporary constraints due to icing, reduced solar radiance, and safety curtailments. These dynamics highlight the importance of balanced resource planning and policy frameworks that support reliable and dispatchable generation alongside the continued integration of renewable energy.

Winter Storm Fern also reinforced the need for sustained investment in the grid's "last-mile" infrastructure, where aging poles and overhead lines remain vulnerable to ice and high winds and accounted for most customer outages and extended restoration times. At the same

time, the event demonstrated the growing importance of expanded transmission infrastructure, which enhances system flexibility, enables resource sharing across regions, and helps mitigate both reliability risks and extreme price volatility during widespread weather events.

Collectively, these lessons reaffirm that disciplined investment, fuel diversity, dispatchable generation, and forward-looking planning are essential to ensuring the electric grid can withstand increasingly frequent and severe weather - delivering reliable service when customers need it most.

The plan outlines best practices for inspections, vegetation management, situational awareness, emergency response, and post-event restoration. Additional mitigations include disabling circuit reclosing during Red

Flag Warnings, remotely adjusting protective device settings in high-risk zones, and the potential de-energization of circuits for public safety.

Collaboration with federal, state, and local agencies ensures AEP remains aligned with evolving science, regulations, and community expectations.

Vegetation Management

Vegetation management is one of the most strategically important and effective ways utilities can reduce electric system failures and service disruptions. Trees and branches contacting power lines are consistently one of the top causes of service interruptions, especially in areas with mature forests or dense vegetation. Vegetation becomes especially hazardous during storms, high winds, ice events, and extreme heat. Fallen trees and branches can down lines, damage poles, and create multi-day outages.

Vegetation management serves as a foundational element of an effective grid reliability strategy - preventing outages, reducing storm impacts, lowering wildfire risk, protecting infrastructure, and improving safety.

AEP manages vegetation growth around power lines within defined easements, including assessing the health of trees outside these rights-of-ways. Our operating companies collaborate with state regulatory commissions to ensure proactive vegetation management while balancing property owner rights and enhancing service reliability. Vegetation management efforts effectively reduce long-term costs, resulting in fewer equipment replacement needs, less storm damage to rebuild, and fewer emergency calls to restore power. During the past five years, we have

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spent approximately $3.4 billion on vegetation management across our service territory, including more than $757 million in 2025.

One way we are safely and efficiently inspecting and maintaining our rights-of-ways is through the use of drone technology. Unmanned aerial systems allow AEP to monitor vegetation conditions along distribution lines and transmission corridors with greater precision while reducing the need for ground access and manual patrols. By capturing high-resolution imagery and data, drones help identify potential hazards earlier,

support proactive vegetation management, and minimize disruption to surrounding communities and ecosystems. This approach improves

reliability, reduces safety risks for field crews, and supports more cost-effective and sustainable grid maintenance.

Learn more about wildfire mitigation efforts within our states in the Customer Service section

Electricity demand across the United States is surging at a pace not seen in decades, driven largely by the explosive growth of data centers and a resurgence in domestic manufacturing.

According to recent research, data centers alone are reshaping load forecasts, with U.S. demand projected to rise from 75.8 GW in 2026 to as high as

134.4 GW by 2030. AEP has signed nearly 63 GW of incremental contracted load by 2030 - all backed by signed electric service agreements and letters of agreement. Additionally, we have approximately 190 GW of active projects in the interconnection queue. This unprecedented load growth comes with both opportunities and challenges as utilities and regulators are required to rethink planning, accelerate infrastructure expansion, and ensure adequate generation resources are available to provide reliable power in this new era of extraordinary demand.

There are many factors that influence the decision to retire a generating unit, including ongoing cost and risk to current and future customers, age and condition of facilities, changing market economics such as fuel costs, and/or federal and state environmental requirements impacting the cost to run the plant. In making the difficult decision to retire a generating plant,

AEP focuses on balancing the plant's remaining life and economic viability with other options for delivering power to reduce the risks, including cost of stranded assets.

One of our top priorities is to maintain adequate resources to provide our customers with reliable and affordable energy. This serves as the objective of our integrated resource plans (IRPs) which use complex models to evaluate optimal generation resource mixes over 10-20 years throughout our various operating companies. These plans assess various scenarios including market trends, fuel prices, resource availability, environmental regulations, and technology costs, to deliver energy to customers using the most cost-effective, stable, and dependable energy resources available.

With the surge in electric demand, AEP anticipates the need for new baseload, dispatchable generation. This may include converting coal plants to natural gas, building or acquiring new facilities, dispatching existing coal

and natural gas resources more, and/or deferring retirements of existing assets to meet capacity requirements and protect the reliability of the grid and customer affordability. Our 2026-2030 capital plan includes investing

$24 billion in diverse generation, including natural gas and energy storage, with $8 billion allocated to renewables.

An all-sources energy strategy will be especially important as we continue to retire or convert approximately 3,600 MW of coal generation by the end of 2028. This is in addition to the approximately 14,500 MW of coal-fueled generation that has been retired, converted, or sold since 2011 to comply with environmental regulations.

To manage stranded asset risk, AEP uses a combination of governance oversight, scenario-based risk evaluation, proactive asset transition planning through our IRPs, and financial mechanisms like securitization. For example, Appalachian Power and Wheeling Power recently received interim approval from the Public Service Commission of West Virginia to securitize undepreciated plant balances and EPA compliance costs, as well as consolidate under-recovered balances from several pending cases such as deferred storm costs from major storms, enabling long-term recovery through rate relief bonds. These efforts aim to protect both shareholders and customers from financial risks and impacts.

NAMEPLATE MW2

NATURAL GAS3

SOLAR

WIND

STORAGE

TOTAL

Appalachian Power

3,071

1,926

605

252

5,854

Indiana Michigan Power

6,690

2,959

3,100

12,799

Kentucky Power

450

Public Service Company 1,975

893

753

200

3,821

Southwestern Electric Power 3,113

600

598

4,311

2026-20351 Projected Resource Needs

of Oklahoma

Company

TOTAL

27,235

502

5,056

6,378

15,299

1 Resource additions are from Integrated Resource Plans (IRP) filings based on current regulations, alternative forms of generation may be added based on specific customer requests.

2 Investments in new generation resources will be subject to market availability of economic projects, regulatory preferences and approvals, and RTO capacity requirements.

3 Natural gas additions may include peaking units and fuel switching to provide reliable, affordable and flexible power.

‌

In 2025, AEP conducted an analysis to determine our ability to achieve our GHG emission reduction goals.

The evaluation demonstrated that changing external conditions and business growth, including unprecedented load growth, evolving market and policy dynamics, and jurisdictional preferences will impact AEP's corporate-wide pathway to reduce Scope 1 GHG emissions by 80% by 2030. Accordingly, AEP continues to focus on supporting state-based clean energy mandates including meeting the Virginia Clean Economy Act and Michigan Public Act 235 mandates that are on track for achievement.

AEP remains committed to seeking advanced low-carbon generation solutions where supported. As an example, Appalachian Power and Indiana Michigan Power are seeking early site permits to bring small modular nuclear reactors to Virginia and Indiana. In light of this shift, we will continue to assess aspirations to achieve net-zero Scope 1 and 2 emissions by 2045. AEP's performance will ultimately be driven by the

needs and desires of the states we serve and will continue to engage with regulators and policymakers to meet the energy needs while facilitating the delivery of reliable, affordable energy.

Cyber and physical threats remain among the most significant risks facing the energy sector, particularly as digital technologies and grid modernization expand the attack surface.

The integration of advanced technologies - including automation, artificial intelligence, mobile and cloud platforms, and digital customer solutions -enhances operational efficiency while introducing new and evolving risks. AEP maintains a comprehensive, risk-based enterprise security program designed to protect the reliability of the electric grid, safeguard customer and company data, and ensure the resilience of critical infrastructure.

Our approach integrates cybersecurity, physical security, and operational resilience through a layered "defense-in-depth" strategy aligned with leading industry frameworks.

AEP employs multiple, coordinated security controls to identify, protect against, detect, respond to, and recover from cyber and physical threats. These controls include continuous monitoring, vulnerability management, incident response capabilities, and resilience planning designed to maintain safe and reliable operations in an evolving threat environment. The company regularly assesses and enhances these capabilities through

exercises, audits, and scenario-based simulations. In addition, recognizing that employees play a vital role in maintaining security, AEP invests in workforce awareness and training programs, including education initiatives that promote accountability and empower employees to identify and respond to potential threats.

Security governance begins at the highest levels of the organization, with executive leadership and board-level oversight providing direction on strategy, risk management, and investment priorities. This structure enables consistent evaluation of emerging threats, alignment with enterprise risk management processes, and accountability for security outcomes across the business.

Collaboration is a critical component of AEP's security strategy. We work closely with industry partners, government agencies, and regulators to share threat intelligence, strengthen collective defenses, and support coordinated response efforts. AEP complies with all applicable NERC reliability standards, including Critical Infrastructure Protection (CIP) and Operations and Planning (O&P) requirements, which establish mandatory expectations for the operation of the North American bulk power system.

Through these efforts, AEP strengthens its ability to anticipate, withstand, and recover from security events, supporting the delivery of safe, reliable, and affordable energy to the customers and communities we serve.

JUMP T O SEC TION

AEP Ohio

AEP Texas

Appalachian Power

Indiana Michigan Power Company

Kentucky Power

Public Service Company of Oklahoma

Southwestern Electric Power Company

C ORE PRINCIPLE

Customer Service

Industry-best customer experience.

AEP is one of the largest electric companies in the country, powering millions of homes and businesses daily.

Our family of operating companies - AEP Ohio, AEP Texas, Appalachian Power, Indiana Michigan Power, Kentucky Power, Public Service Company of Oklahoma, and Southwestern Electric Power Company - are united by a shared purpose: putting our customers first in the decisions we make.

We believe reliable, affordable energy is not just a service - it is a foundation for strong communities, economic opportunity, and everyday life. Guided by this responsibility, we listen closely to the people and businesses we serve, work collaboratively with state regulators and government officials, invest thoughtfully in our systems, and operate with integrity and care. We strive to earn our customers' trust every day and deliver energy solutions that power progress now and for generations to come.

About AEP

Operational Excellence

Customer Service

Employee Commitment Environmental Respect

Governance

Left: Service installation, 1958 • Right: Meter installation, present day

‌About AEP

Operational Excellence

Customer Service

Employee Commitment Environmental Respect

Governance

About AEP Ohio

AEP Ohio provides distribution and transmission services across portions of Ohio and operates in a deregulated electricity market. The company is regulated by the Public Utilities Commission of Ohio (PUCO).

SER VIC E TERRITOR Y

Detroit

QUICK F A C TS as of 12/31/2025

Our Employees

T O TA L E M PLOY E E S

TOT AL CUS TOMERS

1,547,000

CUS TOMER BREAKDOWN

R E SI D E N T I A L

1 , 353 , 000

CO M M E RC I A L

183 , 000

I N D U ST R I A L

8 , 500

OT H E R

2 , 500

Our Customers Our Infrastructure

Ft. Wayne

Muncie

TRANSMISSION

8,787 Miles

Indianapolis

Frankfort

Lima

Columbus

Ashland

Charleston

Wheeling

Our Local Impact

LO C A L & STAT E TA X E S

F E D E R A L TA X E S

T O TA L C H A R ITA B L E G IV IN G

PPA Generating Capacity

DIS TRIBUTION

52,600 Miles

BY FUEL MIX

As of March 31, 2026

67% C OA L

PP A CAP ACITY

638 MW

33% WIND &

SOL AR

Disclaimer

AEP - American Electric Power Company Inc. published this content on May 12, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 12, 2026 at 21:06 UTC.