AMERICAN ELECTRIC POWER CO INC (AEP) Risk Factors

Recent key developments

Concrete developments — dated events, named agreements and instruments, legal proceedings — that AMERICAN ELECTRIC POWER CO INC surfaced in its latest filing.

• Construction or acquisition of additional transmission and generation facilities, including interconnections with data centers and large load customers, is driving significant capital investment amid unprecedented load growth.
• Rates charged by AEP's public utility subsidiaries are subject to approval by FERC and state utility commissions of Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia, and West Virginia, and regulators have initiated proceedings to investigate the prudence of costs.
• AEP Texas's two largest REPs accounted for 38% of its operating revenue in 2025, concentrating receivables and counterparty credit risk.2025
• The Cook Plant, two nuclear generating units owned by I&M with a rated capacity of 2,296 MWs, represented about a tenth of AEP's regulated generating capacity as of December 31, 2025 and exposes AEP to nuclear liability and NRC enforcement.December 31, 2025
• As of December 31, 2025, approximately 8%, 23%, and 15% of the Registrants' available credit facilities were with European, Canadian, and Asian banks, respectively, exposing AEP to geographic concentration risk in funding sources.December 31, 2025
• The Inter-Company Power Agreement (ICPA) obligates APCo, I&M, and OPCo to pay for their 43.47% aggregate power participation ratio of OVEC's approximately 2,400 MW capacity, and as of December 31, 2025, OVEC had outstanding indebtedness of approximately $873 million, of which APCo, I&M, and OPCo are collectively responsible for $379 million.December 31, 2025
• The current administration has implemented tariffs on certain imported goods and may impose additional tariffs, which could exacerbate supply chain constraints and increase costs.