AEP Sustainability - Economic Impact

Economic and Business Development

Building strong, vibrant and sustainable communities requires innovation, investment and collaboration among state, regional and local business partners. AEP’s Economic & Business Development (E&BD) team puts its expertise and partnerships to work supporting economic development and growth within our local communities. Through training, education and financial support, we work to strengthen the economic vitality of our communities to attract people and jobs, which in turn, builds a stronger social safety net for all.

Our National Customers team manages corporate relationships with many of our largest customers to provide customized solutions to meet their energy needs. For instance, when a Colgate-Palmolive facility in Ohio had a catastrophic transformer failure and fire on their electrical facilities, our E&BD team, AEP Ohio, and AEP Transmission combined efforts to provide an immediate response and economical solution. We provided a mobile transformer and new switchgear to avoid plant closure and the need for expensive generators. AEP’s comprehensive, customer-centric response coupled with its flexibility and attention to detail were major drivers in bringing Colgate-Palmolive’s operation back on line in a manner that defied the clock and paved the way for the plant’s single greatest month of production in history.

AEP's Commitment to Our Customers

  • AEP was recognized by Platt’s as one of 12 worldwide finalists in the category “Award of Excellence– Power.”
  • In 2019, AEP, in partnership with Edison Electric Institute and World Resource Institute, created a Customer Energy & Emissions report to provide our customers with their specific greenhouse gas emissions rates based on their location, which can be used to calculate emissions associated with our customers’ energy use. Following a successful pilot, the report will be available annually for customers to access starting in 2020.

In 2019, the E&BD team facilitated, partnered with and supported 155 projects that will bring more than 21,000 jobs to the local economies across our 11-state service territory. Economic development helps our communities in several ways, including increasing the tax base, job development, economic diversification and capacity-building for long-term sustainability. AEP actively works to support industries experiencing high growth.

For example, Steel Dynamics Incorporated (SDI) announced plans to build a mill within the AEP Texas footprint. The E&BD team worked collaboratively with AEP Texas and AEP Transmission to address SDI’s needs regarding energy delivery. The industrial project consists of an approximately $1.9 billion steel mill with energy delivery requirements equal to the combined demand of 400 Walmart Supercenters. The facility will create approximately 600 jobs with an average annual salary of $76,000. With construction beginning in 2020, SDI anticipates beginning operations in 2021.

AEP remains committed to increasing grid capacity in Central Ohio, paving the way for large-scale data center development. As a result, the region has become a leader in the industry with more than $600 million invested by Google, $1.3 billion by Amazon and over $750 million invested by Facebook – excluding a 500,000-square-foot expansion announced in 2019. Additionally, AEP Energy partnered with Google to power its newest data center with 100% renewable energy. Over time, the agreement enables AEP Energy to build up to 100 MW of new wind and solar in the region to meet the center’s demand.

AEP provides comprehensive location advisory services to companies looking to expand or locate new operations in our service territory. AEP’s Quality Sites Program identifies sites that have infrastructure and utilities in place and have completed due diligence studies to help growing businesses minimize overall site location risk, save time and reduce development costs. This includes property searches and screening, custom community and site analysis, and introductions to local economic development partners and industry resources. Learn more about this program and the location of quality sites in AEP’s service territory.

Beyond our current customers, AEP proactively identifies and manages business relationships with prospective customers in target industry sectors to secure investment in new facilities across the AEP system. In addition to pursuing domestic companies, our efforts include recruiting foreign direct investment (FDI) to our service territory, which is a key source of capital, job creation and innovation.

In January 2020, Volvo Mack Trucks and the nation's largest medicinal tea producer, Traditional Medicinals, each announced plans to invest millions and create hundreds of new jobs in southwest Virginia. Volvo Mack Trucks chose to locate in an existing manufacturing building in Roanoke County, which will result in 250 high-paying jobs. The company expects to begin manufacturing medium-duty trucks from start to finish this summer. Traditional Medicinals is in the process of building an East Coast manufacturing and distribution center in Franklin County. The company announced it picked the Franklin County location out of roughly 50 prospects through a process that took about two years. Traditional Medicinals’ $29.7 million investment will create 56 jobs.

The federal government and military are an important customer segment and growth area for AEP. We provide electric service through our regulated utilities to over 3,500 federal accounts. Our team works to help our federal and military customers meet their sustainability and resiliency goals. The federal government has a comprehensive framework for action through 2020 that calls for using resources more efficiently and acquiring more energy from renewable resources. To support that initiative, we help the federal government mitigate the effects of climate change on military operations, installations and national security while enhancing the reliability of their service.

In February 2020, the U.S. Army Corps of Engineers Huntsville awarded Southwestern Electric Power Company a Utility Energy Service Contract (UESC) for Red River Army Depot at Texarkana, Texas. The projected size of this project is approximately $92 million, and it is the first UESC contract awarded to AEP in over 20 years.

Public Service Company of Oklahoma (PSO) is requesting proposals for PV Solar and Reciprocating Internal Combustion Engine (RICE) resources for commercial operation. Both projects will be located at the Fort Sill Military Base in Lawton, Oklahoma. The project will be owned and operated by PSO and will provide power to PSO’s system during normal operations. In the event of an outage or validated threat to the electric supply to Fort Sill, these assets will first be used to restore power to Fort Sill. This project is mutually beneficial as it simultaneously supports PSO’s system and the Army’s goal of enhancing energy resilience.

AEP remains committed to attracting new industry and jobs and empowering local leaders to take the lead in rebuilding their communities.

AEP is building stronger partnerships with our local communities to help revitalize some of the areas hit hardest by the changes in the coal industry. In the heart of Appalachia, the states particularly affected by this are Kentucky, Ohio, Virginia and West Virginia. These states have experienced the loss of jobs, tax revenue to support local public services, and the loss of indirect economic benefits from having a locally employed workforce. To help these states make the transition and diversify their economies, AEP remains committed to attracting new industry and jobs and empowering local leaders to take the lead in rebuilding their communities.

In Kentucky, we began by conducting a comprehensive regional workforce analysis of AEP’s Kentucky territory. Among the findings is that coal industry workers, many of whom lost their jobs due to mine and coal plant closings, have the skills that aerospace and advanced manufacturing companies need. For example, the region has eight times the national average of metalworkers, which are skills the aerospace industry is looking for.

Equipped with the study’s findings, AEP and our regional economic development partners launched Appalachian Sky – an initiative to attract the aerospace and aviation industry to AEP’s central Appalachia service region. AEP commissioned a leading aerospace consultancy to determine the viability of developing the aerospace industry in Appalachia’s coal and steel country. Thirty counties in the region, which includes Kentucky, Ohio and West Virginia, are now certified AEROreadyTM, a certification that assures aerospace companies that the certified regions, sites and communities are suitable for their operations.

In 2019, the seven-county region surrounding Raleigh County Memorial Regional Airport and the six-county region around Yeager Airport in Charleston, both in West Virginia, received AEROready certification, meaning a total of 21 counties and four commercial airports have the coveted certification. Appalachian Power’s West Virginia Advantage Plan, a funding source of $3.4 million for site readiness projects, small business trainings and other economic development projects, provided funding for these certifications. In addition, the AEP Foundation awarded Marshall University a $750,000 grant to establish an aviation program at the school and Yeager Airport.

In addition to counties in Kentucky, Ohio and West Virginia, AEP-served counties have been independently validated as AEROready™ in Texas, Oklahoma, Louisiana and Indiana.

Other efforts include the Kentucky Power Coal Plus Program that helps reopen struggling coal businesses to put miners back to work in Eastern Kentucky. Coal Plus gives Kentucky Power the flexibility to offer special contracts with coal companies and coal processing businesses. For example, companies can receive a discount for operating under a special rate. In 2019, the Kentucky Public Service Commission renewed the Coal Plus Program for 2020.

Appalachian Power is partnering with Marshall University’s Robert C. Byrd Institute and the U.S. Economic Development Administration to undertake a comprehensive analysis of the skills and abilities of workers in 23 additional West Virginia counties. The study, which will identify opportunities to diversify the state’s economy, is funded by a grant from the U.S. Economic Development Administration and matching funds from Appalachian Power. APCo is also undertaking a comprehensive business sites gap analysis study in its West Virginia service territory. This project will evaluate more than 30 sites in order to provide comprehensive plans to allow localities to prepare the sites for future industry.