<PAGE> File No. 70-8307
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________
POST-EFFECTIVE AMENDMENT NO. 2
TO
FORM U-1
__________________________________
APPLICATION OR DECLARATION
under the
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
* * *
AMERICAN ELECTRIC POWER COMPANY, INC.
AEP ENERGY SERVICES, INC.
1 Riverside Plaza, Columbus, Ohio 43215
(Name of company or companies filing this statement
and addresses of principal executive offices)
* * *
AMERICAN ELECTRIC POWER COMPANY, INC.
1 Riverside Plaza, Columbus, Ohio 43215
(Name of top registered holding company
parent of each applicant or declarant)
* * *
G. P. Maloney, Executive Vice President
AMERICAN ELECTRIC POWER SERVICE CORPORATION
1 Riverside Plaza, Columbus, Ohio 43215
Jeffrey D. Cross, General Counsel
AEP ENERGY SERVICES, INC.
1 Riverside Plaza, Columbus, Ohio 43215
(Names and addresses of agents for service)
American Electric Power Company, Inc. ("American") and AEP
Energy Services, Inc. ("AEPES") hereby amends its Application or
Declaration on Form U-1 in File No. 70-8307;
1. By amending and restating ITEM 1. DESCRIPTION OF PROPOSED
TRANSACTIONS as follows:
"A. Background
American Electric Power Company, Inc. ('American') owns all of
the common stock of three non-utility subsidiaries, AEP Resources,
Inc. ('Resources'), AEP Investments, Inc. ('Investments') and AEP
Energy Services, Inc. ('AEPES'). In accordance with its
authorizations (HCAR Nos. 25905, 25984 and 26200, dated October 8,
1993, February 4, 1994 and December 22, 1994, respectively),
Resources is involved in preliminary development activities related
to exempt wholesale generators ('EWG'), foreign utility companies
('FUCO'), qualifying cogeneration facilities and small power
production facilities as defined in the Public Utility Regulatory
Policies Act of 1978 and the rules thereunder ('QF') and other
projects relating to the generation, transmission and distribution
of electric power (collectively 'Power Projects'). In accordance
with its authorizations in File No. 70-7886 (HCAR Nos. 25424 and
25667, dated December 11, 1991 and November 2, 1992, respectively),
Investments has invested in the development of electronic light
bulb technology. In File No. 70-8489, Investments has requested
authority (i) to conduct preliminary development activities related
to energy management, demand-side management and other businesses
functionally related to American's electric utility business, but
not related to Power Projects for which Resources may conduct such
activities and (ii) to make two additional investments.
The Commission by its Order dated April 21, 1982 (HCAR No.
22468) (the '1982 Order') authorized AEP's organization of AEPES,
the acquisition of capital stock and AEPES's consulting activities.
Pursuant to the 1982 Order, the Commission also authorized American
Electric Power Service Corporation to provide services to AEPES in
accordance with Section 13 of the Public Utility Holding Company
Act of 1935 (the 'Act') and Rules 90 and 91 thereunder under the
terms of a Service Agreement which also extended to the sale and
licensing of intellectual property. By Orders dated March 28, 1983
(HCAR No. 22895), June 20, 1983 (HCAR No. 22982) and September 21,
1983 (HCAR No. 23066) (the '1983 Orders'), the Commission also
authorized the operating public utility company subsidiaries of AEP
to enter into arrangements with AEPES.
Pursuant to the 1982 Order, AEPES was authorized to engage in
the business of selling management, technical and training
expertise in the open, competitive market to non-affiliated
entities.
The 1982 and 1983 Orders also authorized AEPES to sell or
otherwise dispose of intellectual property owned and/or developed
by various AEP System companies. By Order, dated March 30, 1994
(HCAR No. 26014) (the '1994 Order'), the Commission authorized
AEPES to engage in preliminary project development activities and
authorized AEP, through December 31, 1995, to invest an additional
$5,000,000 in AEPES.
Pursuant to these authorizations, AEPES has provided a variety
of services to non-affiliated utilities, industries and other
organizations in the United States and abroad. Over the past
several years, a large portion of its revenues were derived from
billings to the U.S. Agency for International Development, in
connection with services provided to the rural electrification
program for the Water and Power Development Authority in Pakistan.
In general, AEPES has provided engineering and design services,
generally consisting of consultation services, technical assistance
and training programs. Several specific areas of services rendered
include substation engineering, design and maintenance; testing and
evaluation of operating and maintenance practices; aerial lift
testing for bucket trucks and consultation services related to
transmission lines and over voltage studies. Over the past several
years, AEPES has devoted a significant amount of time to its
development of Flash Fill, a product designed to utilize fly ash.
Flash Fill is typically used as a fast-setting backfill in street
and underground utility repair. Attached as Schedule A to this
Application is a summary of the types of projects currently under
consideration by AEPES.
B. Restatement and Amendment of Authority
(1) Power Project Services
AEPES proposes to render, and continue to render, project
development, engineering, design, construction and construction
management, operating, fuel management, maintenance and power plant
overhaul, and other similar kinds of managerial and technical
services, to both affiliated and non-affiliated Power Project
entities. No associate company of AEPES (except an AEPES
subsidiary as discussed below) will provide such services to an EWG
or FUCO. AEPES will not undertake any of the foregoing activities
without obtaining the approval of the Commission in a separate
proceeding, if, as a result thereof, AEPES would be or become a
'public utility company', as defined in Section 2(a)(5) of the Act.
All services rendered by AEPES to non-affiliates will
continue to be based upon the fair market value thereof and will be
subject to such other terms, conditions and standards of
performance as are negotiated on a case-by-case basis, taking into
account the kind and scope of services involved, the duration of
the contract, the levels of warranties and indemnities that may be
negotiated, and other factors that are unique to each transaction.
Similarly, AEPES proposes to provide such services and
sell goods to any associate Power Project entity that is an EWG,
FUCO, or QF at fair market prices, and requests an exemption
pursuant to Section 13(b) from the requirements of Rules 90 and 91
as applicable to such transaction in any case in which any one or
more of the following circumstances shall obtain:
(a) Such Power Project entity is a FUCO, or is an EWG
which derives no part of its income, directly or indirectly,
from the generation, transmission, or distribution of electric
energy for sale within the United States; or
(b) Such Power Project entity is an EWG which sells
electricity at market-based rates which have been approved by
the Federal Energy Regulatory Commission ('FERC') or the
appropriate state public utility commission, provided that the
purchaser of such electricity is not an associate company of
AEPES within the American Electric Power System.
(c) Such Power Project entity is a QF that sells
electricity exclusively (i) at rates negotiated at arms'-
length to one or more industrial or commercial customers
purchasing such electricity for their own use and not for
resale, and/or (ii) to an electric utility company, other than
any associate company of AEPES within the American Electric
Power System, at the purchaser's 'avoided cost' as determined
in accordance with the regulations under the Public Utility
Regulatory Policies Act of 1978; or
(d) Such Power Project entity is an EWG or QF that sells
electricity at rates based upon its cost of service, as
approved by FERC or any state public utility commission having
jurisdiction, provided that the purchaser of such electricity
is not an associate company of AEPES within the American
Electric Power System. American and AEPES acknowledge that
the Commission's authorization herein for AEPES to sell
services or goods at prices that are not based on cost (as
determined in accordance with Rules 90 and 91) to any such
Power Project entity shall not be binding upon FERC or any
state public utility commission having jurisdiction over the
rates charged by any such Power Project entity, and represent
and agree that they will not assert or take any position to
the contrary in any administrative or judicial proceeding
involving the determination of rates that may be charged by
any such associate Power Project entity.
Further, AEPES agrees that it will not sell any goods or
services to any associate Power Project entity which, in turn,
sells such goods or services, directly or indirectly, to any other
associate Power Project entity which does not fall within any of
the preceding enumerated categories, except pursuant to the
requirements of the Commission's rules and regulations under
Section 13(b) or an exemption therefrom obtained in a separate
filing.
The final sentence of Section 13(b) permits the
Commission to exempt certain categories of transactions otherwise
falling within the scope of Section 13(b) from the cost requirement
if any such transactions are with any associate company which does
not derive, directly or indirectly, any material part of its income
from sources within the United States, or involve 'special or
unusual circumstances'. A FUCO or foreign EWG clearly falls within
the first category. As to the latter category, AEPES submits that
there is an adequate basis for the Commission to find that 'special
or unusual circumstances' exist when AEPES renders services or
sells goods to an associate Power Project entity if the entity is
engaged in selling electricity at negotiated prices or rates that
are determined wholly without reference to the project's cost of
service, at prices determined on the basis of arms'-length
negotiations with unaffiliated co-investors, and/or under
circumstances where it is otherwise impracticable to determine
cost. (See HCAR No. 125, dated March 10, 1936, in which the
Commission adopted the predecessors of Rules 80 through 92,
including exceptions from the cost rule intended for cases in which
it is 'impracticable to determine cost'.) In this regard, the
Commission has, in the past, recognized that these factors may
provide an appropriate basis for exempting transactions from the
'cost' rules under Section 13(b). (See New England Electric
System, et al., HCAR No. 22309, December 9, 1981).
In most cases, AEPES believes that it will be
impracticable to determine 'cost' in connection with providing
operating, construction and other similar Power Project services.
In order to be competitive with other providers of such services in
the marketplace, as well as responsive to the requirements of
project lenders and power purchasers, among others, the terms and
conditions of many of the services that AEPES anticipates it will
provide, such as power plant operations and maintenance and
construction services, will typically include warranties on
equipment and workmanship, minimum performance guarantees, or
guaranteed completion dates, backed by contract price retention
provisions, liquidated damages or the potential obligation to pay
rebates, as well as broad indemnification terms. Terms such as
these are rarely if ever provided by 'cost'-based subsidiary
service companies or operating utility subsidiaries in a holding
company system in connection with routine intrasystem service or
sales transactions. Such performance-based terms expose the
service provider to substantial, potential, economic risks, for
which it is reasonable to expect compensation in the form of
performance bonuses, success fees or the like. Moreover, it would
be difficult if not impossible to assign a 'cost' to such terms for
purposes of Rules 90 and 91.
For the foregoing reasons, AEPES submits that it is not
necessary or appropriate in the public interest or for the
protection of investors or consumers that the charge for services
or goods provided by AEPES to associate Power Projects be limited
to 'cost' in any of the circumstances listed above.
AEPES will provide services and goods to associate Power
Project entities that do not satisfy any of the above circumstances
at 'cost' in accordance with Section 13(b) of the Act and Rules 90
and 91.
AEPES will not acquire an interest in a Power Project.
If AEPES is entitled to receive an interest in a Power Project as
a result of services that it renders, or goods that it sells, to
the Project, it will sell the interest to Resources at its fair
market value. The fair market value could include the assumption
by Resources of certain performance guaranties made by AEPES to the
Power Project.
(2) Energy Management and Demand-Side Management Services
AEPES additionally requests authorization to provide
energy management and demand-side management services based upon
the fair market value thereof. Such services include marketing,
development, engineering, construction and construction management,
installation, ownership, operation, sale, service, financing and
leasing of energy management or demand-side management equipment.
AEPES also may provide energy management and demand-side management
services to associated companies at cost.
AEPES proposes to provide these services to customers
located in the states of Indiana, Kentucky, Michigan, Ohio,
Tennessee, Virginia and West Virginia, the states in which the
American Electric Power System currently sells electricity at
retail, and limited areas outside of these states (the 'Region').
(The limited areas would consist of the service territories of
utilities to which the American Electric Power System expects to
sell, and from which it expects to purchase, large amounts of
economy and emergency power. These utilities include: Carolina
Power & Light Company, Central Illinois Public Service Company,
Commonwealth Edison Company, Dayton Power and Light Company, Duke
Power Company, Duquesne Light Company, Illinois Power Company,
Indianapolis Power & Light Company, Kentucky Utilities Company,
Louisville Gas and Electric Company, Northern Indiana Public
Service Company, Ohio Edison Company, Tennessee Valley Authority
and Virginia Electric and Power Company, and the utilities of the
Allegheny Power, Centerior, Cinergy and Michigan Electric Co-
ordinated Systems.) AEPES also would provide limited services
outside the Region, with the restriction that revenues attributable
to customers outside of the Region do not exceed revenues
attributable to customers inside of the Region.
(3) Other Consulting Services
AEPES also will continue to offer its management,
technical, operating and training expertise, as well as its
technical and procedural resources, to non-affiliated entities that
are not Power Projects. The price of all such services will be
based upon their fair market value.
(4) Services to Resources and Investments
AEPES furthermore requests authorization in accordance
with Section 13(b) of the Act and Rules 90 and 91 thereunder to
provide services at cost to Resources and Investments and any
subsidiary of either that is not a Power Project entity. AEPES
would enter into a Service Agreement in the form of Exhibit B-1
hereto with Resources, Investments and these subsidiaries.
American Electric Power Service Corporation ('AEPSC')
currently provides all services to Resources and Investments. It
is contemplated that during the next two years AEPSC's role in
providing services will diminish and the function of AEPES will
increase. After the two year period, however, AEPSC will continue
to provide Administrative Services (as defined below) to Resources
and Investments and these subsidiaries.
C. Service Agreements with AEPES
Under authorization contained in the 1982 and 1983 Orders,
AEPES has entered into Service Agreements with AEPSC and the
operating company subsidiaries of American (the 'Operating
Subsidiaries') pursuant to which personnel and other resources of
AEPSC and the Operating Subsidiaries may be made available to
AEPES, upon request, to support AEPES in connection with its
authorized activities. The Operating Subsidiaries provide, account
for and bill their services to AEPES, utilizing a work order
system, on a full cost reimbursement basis in accordance with Rules
90 and 91 under the Act. The reimbursed cost of services
identified through the work order system include all direct charges
and a prorated share of other related costs.
The Service Agreements provide that AEPSC and the Operating
Subsidiaries make warranties of due care and compliance with
applicable laws to AEPES with respect to the performance of the
services requested, but failure to meet these obligations will not
subject them to any claim or liability, other than to reperform the
work at cost in accordance with the work order. Furthermore, AEPSC
and the Operating Subsidiaries are indemnified by AEPES against
liabilities to or claims of third parties arising out of the
performance of work performed on behalf of AEPES for non-affiliate
companies. It is proposed that the Service Agreements be amended
to provide that the indemnity will apply for work performed on
behalf of AEPES for any company, not only non-affiliate companies.
The agreements also extend to the resale or licensing of
property protected by the copyright, patent or trademark laws. If
AEPES sells or licenses to non-affiliates any such property
developed by the Operating Subsidiaries for their own use, such
subsidiaries shall receive a percentage of net profits and AEPES
will receive a commission. The Order dated March 31, 1994 (HCAR
No. 26014) (the '1994 Order') provided that should AEPES use any
intellectual property developed by AEPSC or any other American
Electric Power System company, AEPES will pay the following amounts
to that American Electric Power System company for any such
intellectual property actually sold or licensed by AEPES: (1) 70%
of the revenues from the intellectual property until the American
Electric Power System company that developed the intellectual
property recovers its programming and development costs; and (2)
20% of such revenues thereafter. It is proposed that the Service
Agreements be amended to add this provision. Such property, if
developed by AEPES, will be made available to all associate
companies in the AEP System without charge, except for all expenses
incurred.
Under the existing Service Agreements with the Operating
Subsidiaries, each Operating Subsidiary agrees to make available
personnel or resources requested by AEPES, if it has or can have
available such personnel or resources. Each Operating Subsidiary
has sole discretion in determining the availability of its
personnel and resources.
Under the existing Service Agreement with AEPSC, AEPSC must
provide certain basic services, upon request, to AEPES. It is
proposed that the Service Agreement with AEPSC be amended to
provide that AEPSC is not required to provide any personnel or
resources to AEPES, if in the sole judgment of AEPSC the personnel
or resources are not available.
Finally, in order to comply with Rules 53(a)(3) and 87, the
Service Agreements will contain a provision that will enable AEPES
to identify on a work order basis services and other resources
provided by AEPSC and the Operating Subsidiaries to AEPES in
connection with services and goods provided by AEPES to EWGs and
FUCOs in which American directly or indirectly holds an interest.
Among other things, this will enable American to monitor the
overall usage of employees of the Operating Subsidiaries and AEPSC
in connection with such services.
At present, AEPES has no employees. It uses the personnel and
resources of AEPSC and of the Operating Subsidiaries to perform its
limited business. Its business is expected to increase during the
next two years. As a result, AEPES expects to hire permanent
employees to perform many of these functions during this two-year
period. However, there are certain activities which, by virtue of
common ownership, are most cost effectively performed by AEPSC to
meet the mutual needs of American and all of its associate
companies. Such activities include: (1) external financial
reports; (2) tax services; (3) pension and benefit administration;
(4) risk management; (5) treasury; (6) corporate finance; and (7)
legal services. These activities, as well as other administrative
functions, would continue to be performed after such two year
period by AEPSC for AEPES (collectively, 'Administrative
Services'). In addition, AEPSC and the Operating Subsidiaries may
from time to time provide specific and limited services to AEPES to
enable AEPES to perform its authorized businesses.
D. Investments in AEPES, Financing Authority and Guaranties
Under the 1982 Order, the Commission authorized American to
provide up to $1,000,000 of capital to AEPES for the purpose of its
start-up and initial operations. In the 1994 Order, the Commission
authorized American to make additional investments in AEPES through
December 31, 1995, in the amount of $5,000,000 for preliminary
development activities associated with its consulting business. In
addition, the Commission authorized AEPES to obtain up to
$5,000,000 in debt financing from unaffiliated third parties as
long as the total of the investments and the debt financing does
not $5,000,000. American also was authorized to guarantee the debt
financing of AEPES.
American and AEPES now request authority to increase the
amount that American is authorized to invest in AEPES and the
amount of debt of AEPES that American is authorized to guarantee to
a total of $51,000,000 (the $1,000,000 authorized the 1982 Order,
the $5,000,000 authorized in the 1994 Order, plus an additional
$45,000,000). This authority to make investments and incur debt
would expire December 31, 1995.
The investments by American in AEPES would take the form of
acquisitions of common stock, capital contributions, open account
advances and/or subordinated loans. Any such open account advances
or subordinated loans would bear interest at a rate based on
American's cost of funds in effect on the date of issue, but in no
case in excess of the prime rate at a bank designated by American.
American's cost of funds is represented by its commercial paper
rating, which is currently P-2 by Moody's Investors Services, Inc.
and F-2 by Fitch Investors Service, Inc. Commercial paper notes
sold by American have varying maturities not in excess of 270 days
after the date of issue, and are sold directly to a dealer in
commercial paper at a discount rate not in excess of the annual
discount rate prevailing at the time of issuance for commercial
paper notes of comparable quality and maturity. As a recent
sample, on January 6, 1995, American sold $50,000,000 of commercial
paper notes at a discount rate of 6.07%, for a term of 48 days and
maturing on February 23, 1995.
In addition, AEPES may obtain debt financing from unaffiliated
third parties consisting of commercial banks, insurance companies
or other institutional investors, as long as the total of all
investments by American in AEPES together with any debt financing
does not exceed $51,000,000. Such debt financing may require a
guarantee by American and will not exceed a term of 10 years or
bear a floating interest rate in excess of 115% of the prime rate
in effect at the time of issuance. In connection with any debt
financing obtained by AEPES, it may be required to pay commitment
and other fees not to exceed 25 basis points per annum on the total
amount of debt financing.
AEPES estimates (a) that up to $40,000,000 (but in any case no
more than $45,000,000) of the proposed additional investment by
American will be utilized for working capital in connection with
rendering Power Project and Other Consulting Services and (b) that
up to $10,000,000 (but in any case no more than $20,000,000) of the
proposed additional investment by American will be utilized for
working capital and costs in connection with Energy Management and
Demand-Side Management Services. Working capital in connection
with these activities is needed to fund certain ongoing general and
administrative costs, including personnel, accounting, general
marketing, engineering, legal, financial and training costs, and
costs associated with other necessary support functions required in
connection with developing and administering its businesses. The
availability of working capital will enable AEPES to promptly pay
its associate companies for services they agree to provide to AEPES
under the Service Agreements, as they are proposed to be amended.
The 1994 Order also authorized American to issue guarantees
and assumptions of liability on behalf of AEPES to third parties in
an amount not to exceed $25,000,000 through December 31, 1995.
American and AEPES now seek to increase the maximum amount to
$200,000,000. These guarantees may take the form of bid bonds,
performance guarantees or direct or indirect guarantees, but not
guarantees of debt financing. Such arrangements may be necessary
in order for AEPES to satisfy a potential customer that it has the
support for its contractual obligations. In no event will the
aggregate amount of liability of American in this connection exceed
$200,000,000.
E. Compliance with Rule 54
AEP Resources International, Limited ("AEPRI"), an indirect
subsidiary of American, is an EWG. American, through its
subsidiary, AEP Resources, Inc., invested $5,000 in AEPRI. This
investment represents less than 1% of $1,304,478,000, the average
of the consolidated retained earnings of American reported on Form
10-K or Form 10-Q, as applicable, for the four consecutive quarters
ended September 30, 1994.
AEPRI will maintain books and records and make available the
books and records required by Rule 53(a)(2). No more than 2% of
the employees of the Operating Subsidiaries will, at any one time,
directly or indirectly, render services to AEPRI. American will
submit a copy of Item 9 and Exhibits G and H of American's Form U5S
(commencing with the Form U5S filed for the first calendar year for
which American reports any data under Item 9 or Exhibits G and H),
to each of the public service commissions having jurisdiction over
the retail rates of American's operating utility subsidiaries. No
data was filed under Item 9 or Exhibits G or H in American's Form
U5S for the calendar year 1993.
In addition, (i) neither American nor any subsidiary of
American is the subject of any pending bankruptcy or similar
proceeding; (ii) American's average consolidated retained earnings
for the four most recent quarterly periods ($1,304,478,000)
represented a decrease of approximately $28,532,000 (or 2.1%) in
the average consolidated retained earnings from the previous four
quarterly periods ($1,333,010,000); and (iii) for the year ended
December 31, 1993, there were no losses attributable to American's
investments in AEPRI.
F. Subsidiaries of AEPES
AEPES requests authorization to form a subsidiary company
under the laws of the Cayman Islands for the purpose of rendering
authorized services in foreign countries ('AEPES International').
In addition, AEPES or AEPES International may form wholly-owned
domestic or foreign subsidiary companies to perform authorized
services in their respective jurisdictions. The purpose of forming
such subsidiaries would be to comply with applicable local or
foreign laws, to limit AEPES and AEPES International's exposure to
taxes or for other lawful business purposes. It is proposed that
AEPES International and such subsidiaries be authorized to incur
long and short term debt on the same terms as AEPES, and that
American or AEPES be authorized to guarantee their debt and
performance to the same extent as American could guarantee the debt
and performance of AEPES."
2. By amending and restating ITEM 3. APPLICABLE STATUTORY
PROVISIONS as follows:
"Sections 6(a), 7, 9(a), 10 and 12(b) of, and Rule 45 under,
the Act are directly applicable to this Application-Declaration.
The sale of goods or services to AEPES at cost by AEPSC and the
Operating Subsidiaries or by AEPES to such other American Electric
Power System companies is subject to Section 13(b) and Rules 87, 90
and 91 thereunder. In addition, the sale of services directly by
AEPES and indirectly by AEPSC or the Operating Subsidiaries to any
company that is an EWG or FUCO is subject to Section 32 and Rule
53(a)(3) thereunder or Rule 87, as it is proposed to be amended, as
applicable. The final sentence of Section 13(b) is applicable to
AEPES's request for an exemption from Section 13(b) and Rules 90
and 91 as applicable to the proposed sale of goods and services by
AEPES to associate Power Project entities at prices other than
cost."
3. By amending and restating the last two paragraphs of ITEM
5. PROCEDURE as follows:
"Applicants agree to file, in addition to certificates of
notification required by Rule 24 upon consummation of the
transactions described herein, the following:
(1) Quarterly, within 60 days after the end of
each quarter:
(a) a balance sheet and income statement for AEPES;
(b) a narrative description of the activities of AEPES
during the quarter just ended, organized by
business category (power project services, energy
management and demand-side management services,
other consulting services and services to Resources
and Investments) and within each category, a
description of new services by type;
(c) a listing of any guarantees or assumption of
liabilities by American on behalf of AEPES;
(d) a description of services obtained from associate
companies, specifying the type of service, the
number of personnel from each associate company
providing services during the quarter and the total
dollar value of such services;
(e) a description of services provided to associate
companies which identifies the recipient company,
the service, the charge to the associate and
whether the charge was computed at cost, market or
pursuant to another method, which method shall be
specified;
(f) a chart showing, as of the end of such quarterly
period, all associate companies of American that
are EWGs, FUCOs and QFs, American's direct or
indirect investment in each such entity and the
aggregate direct and indirect investment by
American in all such entities, and American's
percentage equity ownership in each such entity
together with a statement indicating by category
the type of entity or person (i.e., domestic
corporation, foreign corporation, foreign
government, or natural persons) owning the equity
interests in each such entity that are not held
directly or indirectly by American; and
(g) a description of any Intellectual Property provided
to AEPES by AEPSC or any Operating Subsidiary, or
provided by AEPES to AEPSC or any Operating
Subsidiary, the cost thereof (including the cost of
any enhancements) to the company making such
Intellectual Property available, and if known, the
fair market value thereof.
(2) Annually, a Form U-13-60, as modified to include
information required by Account 923 of the Uniform System
of Accounts, 17 C.F.R. Pt. 256.923.
AEPES will account for revenues and expenses of its principal
business activities (i.e., Power Project Services, Energy
Management and Demand-Side Management Services and Other Consulting
Services) on a divisional basis."
4. By amending and restating ITEM 6. EXHIBITS AND FINANCIAL
STATEMENTS to read as follows:
"Item 6. EXHIBITS AND FINANCIAL STATEMENTS
Exhibit B-1 Proposed form of Service Agreement
between AEPES and Resources or
Investments (to be filed by amendment)
Exhibit B-2 Proposed form of new Service Agreement
between AEPSC and AEPES (to be filed by
amendment)
Exhibit B-3 Service Agreement between an Operating
Subsidiary and AEPES (to be filed by
amendment)
Exhibit B-4 Proposed form of amendment to Service
Agreement between an Operating Subsidiary
and AEPES (to be filed by amendment)
Exhibit E Map of the Region (to be filed by
amendment)
Exhibit F Opinion of Counsel (previously filed)
Exhibit G Proposed Form of Notice (previously
filed)
Balance Sheets as of September 30, 1994 and Statements of
Income and Retained Earnings, per books and pro forma, for the 12
months ended September 30, 1994, of AEPES and of AEP and its
subsidiaries consolidated, together with journal entries reflecting
the proposed transactions (to be filed by amendment)."
SIGNATURE
Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, the undersigned companies have duly caused
this amendment to be signed on their behalf by the undersigned
thereunto duly authorized.
AMERICAN ELECTRIC POWER COMPANY, INC.
By__/s/ G. P. Maloney_________________
Vice President
AEP ENERGY SERVICES, INC.
By__/s/ G. P. Maloney_________________
President
Dated: February 6, 1995
70-8307.pe2
SCHEDULE A
1. Foreign Utility Projects - coal-based generation projects for
foreign utilities in which AEPES would either (i) offer
consultation services to the foreign utility, (ii) engineer,
procure and construct such projects, or (iii) sub-contract
with unrelated parties for any of the referenced services.
AEPES might also train personnel of foreign utilities
2. Licensing - licensing of programming, technology and
intellectual property developed by AEPES or AEPSC to
unrelated parties
3. Services - commercial marketing of AEPSC Lab Services
4. Co-generation facilities and Small Power Production Facilities
-projects involving the design and consultation with unrelated
third parties in development of such facilities
5. Consultation Services - provide consulting services with
unrelated parties, perhaps in a subcontractor capacity,
regarding efficiencies in generating plant performance and
transmission and distribution projects and regarding system
planning and civil engineering
6. Research and Development - grants of money and consultation
with third parties regarding various research and development
projects
