AEP's Strategic Plan
The rapid changes transforming the energy industry, thanks to technological innovation and interconnectivity, are altering the dynamics of how people interact with the power grid, turning consumers into active, not passive, participants. From decentralized power generation and electrification to digitization, disruptive innovation is reshaping our industry and our company.
AEP’s strategy for growth and the way we are advancing our business model are changing as we plan for a future that is constantly evolving. Historically, our capital investments focused primarily on large, centralized plants, building new capacity and controlling existing units to comply with environmental regulations to keep them running longer.
Today, our capital investment strategy spans the value chain of generation, transmission and distribution with the customer at the center. Our focus is on providing customer solutions through technology, diversifying our resources and investing in renewables; working with regulators to modernize the regulatory compact to better serve the needs of all of our customers; and preparing for the future of work and the skills our workforce will need. At the same time, we are reducing our environmental footprint, removing risk from our business and delivering value to our customers and shareholders.
AEP’s Business Model Today
AEP’s Strategic Transformation
AEP has laid a strong foundation for a strategic transformation that positions us to be the energy company of the future. We have managed through significant earnings challenges due to the deregulation of our generation assets in Ohio; completed the sale of merchant power plants to reduce the risk from the volatility of unpredictable capacity markets; spun off businesses that were not core to our regulated utility business; diversified our resource portfolio to meet the needs of a clean energy future; set new carbon emissions reduction goals; expanded our business beyond our traditional regulated footprint; embraced continuous improvement to manage our financial resources and improve efficiency, reliability and customer focus; and transformed our culture.
We have established strategic goals and initiatives to shape our future and continue to make progress year over year. Our 2022 vision to be the energy company of the future provides mileposts that are essential to our success. These include grid reliability and modernization, advancing technology and innovation, exceeding customers’ expectations, growing our regulated and contracted renewables, preparing for the workforce of the future and partnering with our regulators to shift the regulatory paradigm to support these activities.