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There are costs and benefits associated with these changes and we are working through all possibilities to ensure our plan addresses our financial, environmental and social responsibilities. The foundation of our action plan is communication, candor and transparency – with our shareholders, customers, regulators, legislators, policymakers and other stakeholders.

The challenges we face, new and old, are difficult but we have an obligation to deliver steady, competitive returns to our shareholders and safe, reliable and reasonably priced electricity to our customers. We seek to do this with minimal impacts to the environment and to provide positive benefits to society. We also have a duty to protect our employees, contractors and the public from harm.  Our commitment is to hold ourselves accountable for our actions and to engage with our various stakeholders to inform our decision making and to communicate our clear intent.

The relationships we developed during the past five years are critical to this. We are able to have candid conversations with many of our stakeholders – whether regulators, governors or environmental groups – because we are committed to this process and are accessible, accountable and honest. This will not change even as we undergo leadership changes this year.

We invite you to learn more about the material issues driving AEP’s sustainability and the actions we are taking. You may not agree with all of our actions or positions, but we invite you to share your thoughts and ideas with us. We promise to listen.

Dennis E. Welch

Material Issues

We define issues material to our sustainability as those that: 1) have or may have a significant impact on the company’s finances or operations; 2) have or may have significant impact on the environment or society, now or in the future; or 3) can substantially influence the assessments, decisions and actions of our stakeholders and shareholders. This report reflects those issues we consider material to our business.

Our material issues are:

Business Performance

  • Financial Performance
    Our ability to manage business risks and to maintain a strong financial foundation allows us to deliver returns to our shareholders; provide safe, reliable electricity to our customers; and deliver broader economic, environmental and social benefits to society. We have a responsibility to maintain a strong balance sheet, investment-grade credit ratings, access to capital markets and sufficient liquidity. Our business performance has direct impacts on our stakeholders and society that we take into account by ensuring that our business strategy and management systems systematically address material issues and risks, by measuring and reporting our performance with accuracy and transparency, and by holding ourselves accountable for the results.
  • Energy Reliability Security & Growth
    Our electric generation and delivery systems must be reliable and able to handle a diverse fuel supply as well as diverse technologies. They also must keep pace with customer demand. Collaboration is essential to create and maintain these systems and to ensure adequate and timely cost recovery.
Environmental Performance
  • Environmental
    Although environmental laws and regulations are complex and changing, we are committed to compliance at all times. Our challenge is to achieve compliance, reduce our impact on the environment, and improve the economic well-being of our communities.
  • Global Climate Change
    Power generation using fossil fuels contributes to global greenhouse gas emissions. While AEP’s contribution on a global scale is quite small, we can play an important role in minimizing our portion of these emissions in several ways. Our company’s and our customers’ economic well-being requires us to work cooperatively with regulators and policy makers, our stakeholders, and our communities to reach a reasonable global solution that will protect the environment and foster economic growth.

Social Performance

  • Regulatory & Public Policy
    We must actively engage legislators, regulators, policymakers and other stakeholders to ensure that public policy, laws and regulations enable us to continue to serve our customers, compensate our shareholders and pursue our vision for sustainability. We will continue to work with regulators and legislators on regulatory solutions.
  • Our People
    Protecting the safety and health of our employees and contractors and reducing the severity of work-related injuries is a core value. We seek a skilled, diverse and highly motivated work force to support all aspects of our business.
  • Stakeholder Engagement
    All of the material issues and risks we face and our well-being as a company increasingly depend on working closely with our stakeholders, disclosing our intentions, reporting on our performance and engaging in active and forthright dialogue.