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GLOBAL CLIMATE CHANGE

Climate change may be one of the most significant sustainability issues for AEP. And while AEP took a leadership role publicly on the issue, national public policymakers and regulators in our 11 states have conflicting views about global warming and the need for greenhouse gas (GHG) regulations in the United States.

AEP proactively supported a number of proposed climate bills in Congress, despite backlash from many of our states, and made significant investments in clean-coal technologies. We voluntarily reduced or offset carbon dioxide (CO2) emissions through the Chicago Climate Exchange between 2003 and 2010 and set a new goal for 2020. We also set a goal to increase the renewable energy on our system. We are proud of the progress we’ve made to reduce our carbon dioxide emissions during the last decade, and the transformation of our generation business will further reduce those emissions in the future. Yet, there still is no mandate to drive these investments. Absent legislation or regulation, our shareholders are exposed to paying costs without corresponding benefits. We must focus on what we can afford to do until there is clear federal direction on climate.

When we learned we would not be allowed to recover the costs associated with our investments in carbon capture and storage (CCS), we were forced to suspend work on CCS projects to minimize our loss. While we believe a technical solution is required, our experience has taught us that we need to wait for mandated action that will allow us to recover costs.

We are focused on taking practical, short-term actions to reduce our carbon footprint, such as improving energy efficiency, investing in the development of cost-effective and less carbon-intensive technologies and evaluating our assets – power plants, office buildings, and mobile fleet – across a range of reasonable scenarios. Longer term, the transformation of our generation business is expected to reduce our reliance on coal from 67 percent of our generating capacity in 2011 to about 50 percent in 2020. This balancing of our fuel resources will also keep us on the path to continued carbon dioxide reductions, helping us achieve our 2020 goal to reduce GHG emissions by 10 percent from 2010 levels.

We are also actively engaged in many different public policy discussions at the state, federal and international levels to assure that any new proposed requirements are feasible, economic and don’t put our customers at a competitive disadvantage.

 

  • For more data, please see the Environmental section of AEP’s Global Reporting Initiative G3 questionnaire.