AEP to invest USD 9bn in regulated renewables by 2027
The Traverse Wind Energy Cente in Oklahoma. Source: American Electric Power.
American Electric Power Company Inc (NASDAQ:AEP) plans to make capital investments of USD 40 billion (EUR 40.4m) in the 2023-2027 period, of which USD 9 billion will be spent on regulated renewable generation.
The energy company, which is presenting its financial plan and strategy to analysts today, will channel USD 26 billion of investment to its transmission and distribution operations during the period.
"Nearly all of our capital will be allocated to our regulated businesses, and 90% of our future investment will focus on wires and renewables," AEP president and chief financial officer Julie Sloat said in a news release. "This approach will enable us to enhance service for customers, advance the clean energy transition and take advantage of a robust pipeline of growth opportunities in the grid and renewable energy space,” Sloat added.
Earlier in 2022, AEP announced plans to offload its portfolio of contracted, unregulated renewable energy assets. The sales process started in August and is set to close in the second quarter of 2023, the company said. It is also poised to complete the sale of its Kentucky operations in January 2023.
Focused on growth in its regulated businesses, AEP announced it is starting a strategic review of its retail business as part of efforts to de-risk and streamline the company.
In today’s announcement, AEP also narrowed its guidance for 2022 operating earnings to between USD 4.97 and USD 5.07 per share, with the midpoint raised to USD 5.02 per share.
AEP has about 31 GW of electricity generating capacity, of which more than 7.1 GW is renewable. It aims to expand its renewable generation portfolio to 50% of the total capacity by 2030.