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Environmental Regulations

The increasing scope and stringency of environmental regulations pose technical and financial challenges for our industry. These challenges are influencing decisions to upgrade or retire coal-fueled generating units and planning for new generation projects across our industry.

Across our sector, the Edison Electric Institute reports that at least 68,500 MW – which represents about 20 percent of the total coal generating capacity in the United States in 2010 – will be retired by 2022. This excludes additional impacts from new GHG regulations that are under development. A report from the U.S. Department of Energy predicts the scope of the retirements will require significant investments in transmission to maintain grid reliability. As a result, our investments will be substantial.

AEP plans to retire 4,063 MW of regulated power generation in 2015 and 2016 and is retrofitting with environmental controls or refueling another 6,090 MW. On the competitive side of our business, 2,523 MW of competitive generation is scheduled to be retired in 2015 and 1,155 MW is earmarked for environmental controls.

AEP’s active participation in development of new regulations is intended to ensure that new requirements are achievable, based on sound science, balanced with other rulemakings and implemented in a rational time frame. We must be responsible to our shareholders who make the required capital investment and to our customers, who will ultimately pay for the implementation of compliance strategies. Some of our stakeholders disagree with our approach to public policy and regulatory advocacy. We are committed to staying engaged with them through the process, as that is the best opportunity for understanding and addressing each other’s concerns.

Our Commitment to Zero Harm

At AEP, our focus on zero harm - zero injuries, illnesses or fatalities - means compliance with regulations is just a starting point. We are committed to continuous safety and health improvement.
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