AEP Sheds Non-Core Assets, Focuses on Renewable, T&D Growth

Researched by Industrial Info Resources (Sugar Land, Texas)--In anticipation of rocky economic conditions, American Electric Power Company Incorporated (NASDAQ:AEP) (AEP) (Columbus, Ohio) is planning to sell off its competitive retail energy business, as part of a broader effort to simplify and de-risk its portfolio as economic activity slows in its service areas. The company is now focusing on its core regulated utility operations, which include more renewable investments and upgrades to major transmission systems.

Industrial Info is tracking nearly $8 billion worth of active projects from AEP, more than half of which is attributed to transmission and distribution (T&D) projects. AEP's active projects in the PJM Interconnection service territory, which runs from the Great Lakes area to the northern Mid-Atlantic region, include a host of major T&D improvement projects.

AEP expects to sell AEP Energy, its competitive retail energy unit, to IRG Acquisition Holdings (IRG) (Los Angeles, California), a subsidiary of Invenergy (Chicago, Illinois). The company also initiated a "strategic review" of three non-core T&D joint ventures--Prairie Wind Transmission, Pioneer Transmission and Transource Energy--which include 370 miles of transmission lines and four substations.