Our regulated businesses have well-defined service territories, customer rates and return-on-equity rates for capital investments approved by state and federal regulators. Our operating company presidents have primary responsibility for their companies’ balance sheets, earnings, capital allocation, rate base growth, regulatory relationships and overall performance. They work collaboratively with other business units and with each other to meet the needs of their customers. This local approach also strengthens relationships with the communities they serve and provides a better understanding of what local regulators will support.
This is important as we make significant capital investments to comply with environmental regulations, invest in our transmission and distribution infrastructure and maintain the operational integrity and reliability of the entire system.
Vertically integrated public utilities – AEP owns and operates generation facilities and transmission and distribution lines and other facilities to deliver electric power. These utilities generate, transmit and distribute electricity for sale to retail and wholesale customers through the assets owned by Appalachian Power Company, Indiana Michigan Power Company, Kentucky Power Company, Public Service Company of Oklahoma, Southwestern Electric Power Company, Wheeling Power Company, Kingsport Power Company and AEP Generating Company (regulated generation properties).
Transmission and distribution – This business segment is involved with the transmission and distribution of electricity for sale to retail and wholesale customers in Ohio and Texas. AEP Ohio serves more than 1.4 million retail customers and AEP Texas serves nearly 1 million customers. These companies are often referred to as “wires only” businesses because they do not include the generation function in their business. While 100 percent of AEP Texas customers purchase generation supply from competitive retail electric suppliers, AEP Ohio purchases energy and capacity to serve its remaining generation service customers who have not selected their own supplier.