American Electric Power (AEP) released a report outlining the company’s strategy for a clean energy future. The strategy includes new carbon dioxide emission reduction goals and investments in renewable resources and advanced technologies to enhance the efficiency of the power grid.
In the report, AEP outlines a business strategy that will lead to reductions in carbon dioxide emissions from its power plants of 60% from 2000 levels by 2030 and 80% from 2000 levels by 2050.
AEP expects to achieve its carbon dioxide emission reductions through a variety of actions including investments in renewable generation and advanced technologies; investment in transmission and distribution systems to enhance efficiency; increased use of natural gas generation; and expanded demand response and energy efficiency programs.
“AEP is focused on modernizing the power grid, expanding renewable energy resources and delivering cost-effective, reliable energy to our customers,” said Nicholas K. Akins, AEP Chairman, President, and Chief Executive Officer. “Our customers want us to partner with them to provide cleaner energy and new technologies while continuing to provide reliable, affordable energy. Our investors want us to protect their investment in our company, deliver attractive returns and manage climate-related risk. This long-term strategy allows us to do both.”
AEP’s resource plans include adding 3,065 MW of solar generation and 5,295 MW of wind generation to the portfolio serving its regulated utility customers by 2030. AEP’s largest planned renewable energy investment is the $4.5 billion, 2,000-MW Wind Catcher Energy Connection project in Oklahoma. If approved, Wind Catcher will be the largest contiguous wind farm in the U.S. and will deliver nearly 9 million MWh of low-cost wind energy annually to AEP customers in Oklahoma, Arkansas, Louisiana, and Texas. Wind Catcher approval would accelerate how quickly AEP can add new wind generation to its portfolio.
AEP also is investing in renewable energy in competitive markets. Between 2018 and 2020, the company plans to invest approximately $1.2 billion in contracted renewables and renewables integrated with energy storage.
To enhance the efficiency and resiliency of the energy delivery system, AEP’s strategy includes plans to invest nearly $13 billion over the next three years in its transmission and distribution system.
AEP has factored future carbon regulations into the company’s evaluation of generation resource options for many years and will continue to do so. The company already has cut its carbon dioxide emissions by 44% since 2000.
AEP’s generation capacity has gone from 70% coal-fueled in 2005 to 47%. Its natural gas capacity increased from 19% in 2005 to 27%, and its renewable generation capacity has increased from 4% in 2005 to 13%.
“This transition to a more balanced resource portfolio will help mitigate risk for our customers and shareholders alike and ensure a more resilient and reliable energy system into the future,” Akins said.
AEP’s Strategic Vision for a Clean Energy Future 2018 report complements the integrated Corporate Accountability Report that AEP has produced for the last 11 years to provide a comprehensive view of the company’s performance on key financial, environmental, social, governance and sustainability issues that are important to shareholders, customers, and other stakeholders. Additionally, AEP helped lead the steering committee for Edison Electric Institute’s ESG/sustainability reporting effort, a voluntary electric industry initiative to help provide industry investors with more uniform and consistent environmental, social, governance, and sustainability-related (ESG/sustainability) metrics.
More information about AEP’s clean energy strategy can be found here.
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