American Electric Power (AEP) is one of the largest investor-owned electric utility holding companies in the United States, primarily engaged in the generation, transmission, and distribution of electricity. AEP operates through several reportable segments, including Vertically Integrated Utilities, Transmission and Distribution Utilities, AEP Transmission Holdco, and Generation & Marketing . The company provides electricity to retail and wholesale customers and offers energy management services, marketing, and risk management .
- Vertically Integrated Utilities - Engages in the generation, transmission, and distribution of electricity for retail and wholesale customers through subsidiaries such as AEGCo, APCo, I&M, KGPCo, KPCo, PSO, SWEPCo, and WPCo .
- Transmission and Distribution Utilities - Focuses on the transmission and distribution of electricity through AEP Texas and OPCo, which also purchase energy and capacity to serve standard service offer customers .
- AEP Transmission Holdco - Responsible for the development, construction, and operation of transmission facilities, with investments approved by FERC and PUCT .
- Generation & Marketing - Includes contracted energy management services, marketing, risk management, retail activities, and competitive generation, primarily in ERCOT, MISO, PJM, and SPP .
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| Name | Position | External Roles | Short Bio | |
|---|---|---|---|---|
Benjamin G.S. Fowke ExecutiveBoard | Interim CEO and Interim President | Board Member at Securian Financial, Energy Insurance Mutual | Former CEO of Xcel Energy; joined AEP's board in 2022; appointed Interim CEO in 2024. | |
Kate Sturgess Executive | Senior Vice President, Chief Accounting Officer, and Controller | None | Former VP and Controller at Edison International; joined AEP in 2023; Chartered Accountant with expertise in financial operations. | |
Kelly J. Ferneau Executive | Executive Vice President and Chief Nuclear Officer | None | Former Site VP at Donald C. Cook Plant; promoted to Chief Nuclear Officer in 2024; oversees nuclear operations. | |
Trevor I. Mihalik Executive | Executive Vice President and CFO | Chair of the Finance Committee for WD-40 Company | Former CFO of Sempra; joined AEP in 2025; oversees financial operations, strategy, and investor relations. | |
William J. Fehrman Executive | CEO and President | Board Member at Centuri Holdings, Inc.; Board Member at Vestas Wind Systems A/S | Former CEO of Berkshire Hathaway Energy; joined AEP in 2024; focuses on grid resiliency and generation transformation. | |
Daniel G. Stoddard Board | Director | None | Former Chief Nuclear Officer at Dominion Energy; joined AEP's board in 2023; expertise in nuclear operations and renewables. | |
Henry P. Linginfelter Board | Director | Board Member at Southwest Gas Holdings Inc. | Former EVP of Southern Company Gas; joined AEP's board in 2024; expertise in utility operations and regulatory affairs. | |
Lewis Von Thaer Board | Director | CEO of Battelle Memorial Institute; Board Chair at AmplifyBio; Board Member at Ambri, Inc.; Trustee at The Ohio State University | CEO of Battelle; joined AEP's board in 2022; expertise in technology, nuclear oversight, and cybersecurity. | |
Margaret M. McCarthy Board | Director | Director at Alignment Healthcare, First American Financial Corporation, Marriott International Inc. | Former EVP of Operations and Technology at Aetna; joined AEP's board in 2019; expertise in technology and operations. | |
Sandra Beach Lin Board | Director | Director at Avient Corporation, Trinseo Plc, Ripple Therapeutics Corporation | Retired CEO of Calisolar; joined AEP's board in 2012; brings expertise in manufacturing and operations. | |
Sara Martinez Tucker Board | Chair of the Board of Directors | Director at Service Corporation International, Nationwide Mutual Insurance Company; Trustee at University of Notre Dame | Former Under Secretary of Education; joined AEP's board in 2009; became Chair in 2024; focuses on governance and leadership transitions. |
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Given the significant increase in your capital plan to $54 billion from the prior $43 billion plan, and the potential for an additional $10 billion in transmission and generation investments, how do you plan to finance this growth while maintaining a strong balance sheet, especially considering your commitment to responsibly finance capital needs and explore asset monetization opportunities?
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Despite accelerating load growth driven by data centers, your utility ROE is moderated to 9.1% from your earlier plan; can you elaborate on the factors causing this moderation and what steps you're taking to improve your earned ROEs to match authorized levels?
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With commitments for 20 gigawatts of load additions through 2029, primarily from data center demand, what challenges do you foresee in connecting these large customers to the grid, and how are you addressing potential supply chain constraints or timely infrastructure development?
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You mentioned plans to decouple your dividend growth rate from your earnings growth rate, resulting in a lower dividend payout ratio over time in the range of 55% to 65%; how do you expect this change to impact investor sentiment, and what is the rationale behind this strategic shift?
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Given the organizational restructuring to align and simplify the structure, including bringing on an expert in transformation and eliminating management layers, can you provide more details on the expected cost savings and how these changes will enhance your ability to execute on growth opportunities?
Research analysts who have asked questions during AMERICAN ELECTRIC POWER CO earnings calls.
Carly Davenport
Goldman Sachs
7 questions for AEP
Jeremy Tonet
JPMorgan Chase & Co.
7 questions for AEP
Julien Dumoulin-Smith
Jefferies
6 questions for AEP
Nicholas Campanella
Barclays
6 questions for AEP
David Arcaro
Morgan Stanley
5 questions for AEP
Shahriar Pourreza
Guggenheim Partners
4 questions for AEP
Andrew Weisel
Scotiabank
3 questions for AEP
Ross Fowler
Bank of America
3 questions for AEP
Steve Fleishman
Wolfe Research, LLC
3 questions for AEP
Steven Fleishman
Wolfe Research
3 questions for AEP
Anthony Crowdell
Mizuho Financial Group
2 questions for AEP
Durgesh Chopra
Evercore ISI
2 questions for AEP
Ryan Levine
Citigroup
2 questions for AEP
William Appicelli
UBS
2 questions for AEP
David Paz
Wolfe Research, LLC
1 question for AEP
Jamieson Ward
Jefferies
1 question for AEP
Nick Campanella
Barclays
1 question for AEP
Ross Bowler
Bank of America
1 question for AEP
| Customer | Relationship | Segment | Details |
|---|---|---|---|
NRG Energy | Energy delivery services | AEP Texas | In 2024: 40% of total revenues, 37% of AR ; 2023: 41% of total revenues, 34% of AR ; 2022: 45% of total revenues, 42% of AR. |
TXU Energy | Energy delivery services | AEP Texas | In 2024: 40% of total revenues, 37% of AR ; 2023: 41% of total revenues, 34% of AR ; 2022: 45% of total revenues, 42% of AR. |
Notable M&A activity and strategic investments in the past 3 years.
| Company | Year | Details |
|---|---|---|
Renewable Generation Facilities* | 2023 | American Electric Power (AEP) acquired and placed into service 159 MW of owned renewable generation assets—including the Rock Falls Wind Facility—with an investment of approximately $154 million, further reinforcing its renewable portfolio. Additionally, AEP sold its larger 1,365 MW unregulated renewables portfolio for $1.2 billion, with proceeds aimed at strengthening its regulated business. |
Sempra Renewables LLC | 2019 | AEP’s acquisition of Sempra Renewables LLC for approximately $1.1 billion (including $583 million in cash, $364 million of assumed debt, and recognition of $135 million in noncontrolling tax equity) brought 724 MW of wind and battery assets—including seven wind farms with long-term PPAs—into its portfolio, aligning with its strategy to expand and diversify renewable generation. |
Recent press releases and 8-K filings for AEP.
- AEP delivered Q3 2025 operating earnings of $1.80 per share, reaffirmed its 2025 full-year guidance of $5.75–$5.95 and issued 2026 operating earnings guidance of $6.15–$6.45 per share (~8% above the 2025 midpoint), while establishing a 7%–9% long-term earnings CAGR for 2026–2030.
- Introduced a $72 billion capital investment plan over 2026–2030 (30% above the prior plan), with over two-thirds directed to transmission and generation, driving a 10% five-year rate-base CAGR and nearly 90% of spend recovered through reduced lag mechanisms.
- Underpinned by exceptional demand growth, AEP now has 28 GW of incremental contracted load (up from 24 GW) and projects 65 GW system peak demand by 2030, with ~80% of new load from data centers secured under energy service agreements.
- Highlighted its transmission leadership, operating 2,100 miles of 765 kV lines (90% of U.S. total) and targeting a transmission rate base exceeding $50 billion by 2030, with transmission expected to contribute over 50% of 2026 operating earnings.
- AEP delivered Q3 operating earnings of $1.80 per share ($963 million), reaffirmed its FY 2025 EPS guidance of $5.75–$5.95 (upper half) and set 2026 guidance at $6.15–$6.45 (≈8% growth)
- Introduced a 7–9% long-term operating earnings growth rate for 2026–2030 (9% expected CAGR) supported by a $72 billion five-year capital plan
- Highlighted 28 GW of contracted load additions driving demand to a projected 65 GW system peak by 2030, leveraging 2,100 miles of 765 kV transmission (90% of U.S. 765 kV infrastructure)
- Forecasts residential rates to rise ~3.5% annually through 2030 (below historical inflation) and plans to maintain FFO-to-debt at 14–15%, with $5.9 billion in growth equity issuance in the back half of the plan
- Reported Q3 2025 GAAP EPS of $1.82 and Operating EPS of $1.80, with YTD Operating EPS at $4.78, and guided to the upper half of the 2025 Operating EPS range of $5.75–$5.95.
- Introduced a new long-term Operating EPS growth rate of 7%–9% with an expected 9% CAGR through 2030, supported by a $72 billion capital plan and projected system peak demand of ~65 GW by 2030.
- Delivered strong load growth, including ~2 GW of data center load in Q3 and ~8% commercial and industrial load growth on a rolling 12-month basis as of 9/30/2025.
- Provided 2026 guidance with Operating EPS of $6.15–$6.45, >$12 billion in capital investment, >50% of operating earnings from high-growth transmission, and 4 GW of incremental contracted load additions.
- Consolidated revenue of $3,579.8 million in Q3 2025.
- Operating earnings (non-GAAP) of $573.5 million, versus GAAP net income of $578.2 million.
- Fuel and purchased power expenses totaled $1,168.4 million for the quarter.
- Includes an after-tax $4.7 million mark-to-market gain on commodity hedges.
- AEP delivered Q3 2025 operating earnings of $1.80 per share ($963 million), down from $1.85 per share in Q3 2024, primarily due to last year’s sale of the distributed resources business.
- Reaffirmed full-year 2025 guidance of $5.75–$5.95 per share (guiding to the upper half) and set 2026 operating earnings guidance at $6.15–$6.45 per share, an ~8% increase over the 2025 midpoint.
- Unveiled a $72 billion five-year (2026–2030) capital plan—up >30%—driving a 10% rate‐base CAGR, with ~90% of investments recovered through reduced regulatory lag and two-thirds allocated to transmission and generation.
- Introduced a new long-term operating earnings growth rate of 7%–9% annually (9% expected CAGR) for 2026–2030, with growth weighted toward the latter years as capital deployments peak.
- Highlighted robust demand, including 28 GW of contracted incremental load (up from 24 GW) and 8% rolling 12-month C&I load growth, supporting major 765 kV transmission expansions and grid modernization.
- AEP reported Q3 2025 GAAP EPS of $1.82 and operating EPS of $1.80, versus GAAP $1.80 and operating $1.85 in Q3 2024.
- Reaffirmed full-year 2025 operating EPS guidance of $5.75–$5.95, with results expected in the upper half of the range.
- Unveiled a $72 billion five-year capital plan to support 28 GW of new load and target 7–9% long-term operating EPS growth through 2030.
- Projects rate base to grow at a 10% CAGR to $128 billion by 2030.
- AEP reported third-quarter 2025 operating earnings of $963 million or $1.80 per share, compared with $985 million or $1.85 per share in Q3 2024.
- Announced a five-year $72 billion capital plan, supported by 28 GW of new load backed by customer agreements, targeting 7–9% long-term operating earnings growth through 2030 and 10% CAGR in rate base to $128 billion by 2030.
- Reaffirmed full-year 2025 operating earnings guidance in the upper half of $5.75–$5.95 per share and provided 2026 guidance of $6.15–$6.45 per share.
- Capital plan allocations include $30 billion for transmission, $20 billion for generation and $17 billion for distribution to support peak demand growth from 37 GW to 65 GW by 2030.
- AEP’s Board declared a quarterly cash dividend of $0.95 per share, a 2¢ increase, payable Dec. 10, 2025, to shareholders of record Nov. 10, 2025.
- This represents the company’s 462nd consecutive quarterly common stock dividend, maintaining an uninterrupted payout since July 1910.
- AEP has delivered a consistent quarterly dividend for 115 years, demonstrating long-term shareholder value commitment.
- The U.S. Department of Energy closed a $1.6 billion loan guarantee for AEP to rebuild and upgrade 5,000 miles of transmission lines across Indiana, Michigan, Ohio, Oklahoma, and West Virginia.
- This financing is the first under the Energy Dominance Financing Program, established by the One Big Beautiful Bill Act signed in 2025.
- Initial projects will upgrade approximately 100 miles of lines in Ohio and Oklahoma, with additional segments to follow.
- AEP projects 24 GW of incremental electricity demand by 2030 driven by data centers, AI, and manufacturing, but its debt-to-equity ratio of 1.56 and Altman Z-Score of 0.99 signal financial distress risk.
- AEP Transmission closed on a $1.6 billion loan guarantee at a preferred rate from the U.S. DOE’s Loan Programs Office to upgrade nearly 5,000 miles of transmission lines across five states, saving customers an estimated $275 million in financing costs over the loan’s life.
- The upgrades will replace existing lines within current rights-of-way with higher-capacity conductors to bolster reliability and support surging demand—including committed expansions requiring an additional 24 GW of capacity by 2030—while fostering economic growth.
- Project rollout is expected to create 1,100 construction jobs, with the first 100 miles of work in Ohio and Oklahoma already underway and further funding and projects to follow.
- AEP will collaborate with local communities and landowners on siting to power developments in data centers, AI, manufacturing, and other critical technologies in its service territory.