File No. 70-9021
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________
AMENDMENT NO. 1
TO
FORM U-1
__________________________________
APPLICATION OR DECLARATION
under the
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
* * *
AMERICAN ELECTRIC POWER COMPANY, INC.
AEP RESOURCES, 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)
* * *
John F. Di Lorenzo, Jr., Associate General Counsel
AMERICAN ELECTRIC POWER SERVICE CORPORATION
1 Riverside Plaza, Columbus, Ohio 43215
(Names and addresses of agents for service)
Jeffrey D. Cross, General Counsel
AEP RESOURCES, INC.
1 Riverside Plaza, Columbus, Ohio 43215
(Names and addresses of agents for service)
American Electric Power Company, Inc. ("American"), a New York
corporation and a holding company registered under the Public
Utility Holding Company Act of 1935 ("1935 Act"), and AEP
Resources, Inc. ("Resources"), a wholly-owned nonutility subsidiary
of American, hereby amend their Application or Declaration on Form
U-1 in File No. 70-9021:
1. By filing the following exhibits:
(a) Exhibits:
A-1 Letter of the Indiana Utility Regulatory
Commission
A-2 Letter of the Kentucky Public Service
Commission
A-3 Opinion and Order of the Michigan Public
Service Commission
A-4 Letter of The Public Utilities Commission of
Ohio
A-5 Letter of the Tennessee Regulatory Authority
A-6 Letter of the Virginia State Corporation
Commission
A-7 Letter of the Public Service Commission of
West
Virginia
SIGNATURES
Pursuant to the requirements of the Public Utility
Holding Company Act of 1935, the undersigned companies have duly
caused this statement to be signed on its behalf by the undersigned
thereunto duly authorized.
AMERICAN ELECTRIC POWER COMPANY, INC.
By /s/ G. P. Maloney
Vice President
AEP RESOURCES, INC.
By /s/ G. P. Maloney
Vice Chairman
Date: July 3, 1997
Exhibit A-1
April 16, 1997
Honorable Arthur Levitt
Chairman
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: AEP, File No. 70-9021
Dear Chairman Levitt:
American Electric Power Company, Inc. ("AEP") and Indiana
Michigan Power Company ("I&M"), a subsidiary of AEP, have advised
this Commission that AEP will be requesting Commission approval for
an increase in its authority for investments in exempt wholesale
generators ("EWGs") and foreign utility companies ("FUCOs") beyond
that permitted under existing AEP Orders. In connection with such
activities, AEP has requested that the Indiana Utility Regulatory
Commission ("IURC") provide to you a certification of its authority
to protect the ratepayer of I&M.
As one of the State commissions having jurisdiction over the
retail electric rates of AEP's public utility subsidiary I&M,
please be advised that based on:
1. this Commission's statutory authority to supervise and
regulate electric utilities and all matters relating to
the performance of their public duties and their charges
therefore, and to correct any abuses of such utilities,
2. the representations set forth in AEP's application to
your Commission referenced above, including, but not
limited to, the representation that the assets of I&M
will not be encumbered, and
3. the requirement of Sec. 33(e)(2) of the Public Utility
Holding Company Act that AEP or I&M will timely inform
this Commission when AEP or any subsidiary actually
acquires ownership in FUCOS or EWGs pursuant to its
proposal,
this Commission is of the view that AEP's proposal will not impair
the ability of this Commission to protect I&M's retail electric
customers in Indiana.
The foregoing is expressly conditioned on and is subject to
being revised or withdrawn by this Commission, if it deems that
action to be appropriate.
Sincerely,
/s/ John F. Mortell
John F. Mortell
Chairman
cc: Commissioner Mary Jo Huffman
Commissioner Camie Swanson-Hull
Commissioner G. Richard Klein
Commissioner David Ziegner
Robert C. Glazier, Director of Utilities
Exhibit A-2
May 5, 1997
Hon. Arthur Levitt
Chairman
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: American Electric Power Company
Form U-1 Application
File No. 70-9021
Dear Chairman Levitt:
The Kentucky Power Company ("Kentucky Power"), a subsidiary of the
American Electric Power Company, Inc. ("AEP"), a registered public
utility holding company, has advised this Commission that AEP has
applied to your Commission to increase its authority to acquire or
otherwise invest in foreign utility companies ("FUCOs") and exempt
wholesale generators ("EWGs"). AEP has requested that the Kentucky
Public Service Commission certify to you that such increased
investment authority in FUCOs and EWGs will not impair the ability
of this Commission to regulate Kentucky Power or protect its retail
customers in Kentucky.
As the State commission having jurisdiction over the retail
electric rates of AEP's public utility subsidiary, Kentucky Power,
please be advised that based on:
1. this Commission's statutory authority to supervise and
regulate electric utilities and all matters relating to
the performance of their public duties and their charges
therefor, and to correct any abuses of such utilities,
and
2. the representations set forth in AEP's application to
your Commission, including, but not limited to, the
representations in Item 3(2)(a) that the assets of
Kentucky Power will not be encumbered and utility
customers will be held harmless for any investment losses
or inadequate returns arising from exempt projects,
this Commission is of the view that AEP's proposal will not impair
the ability of this Commission to regulate Kentucky Power or
protect its retail customers in Kentucky.
The foregoing opinion of this Commission on AEP's proposal is
expressly conditioned on provisions 1 and 2 above and is subject to
being revised or withdrawn by this Commission, if it deems that
action to be appropriate. AEP has represented that it will timely
inform this Commission when AEP actually acquires ownership in
FUCOs or EWGs pursuant to its proposal.
Sincerely,
/s/ Linda K. Breathitt
Linda K. Breathitt
Chairman
cc: Edward Holmes, Vice Chairman
B. J. Helton, Commissioner
Exhibit A-3
STATE OF MICHIGAN
BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION
* * * * *
In the matter of the application of )
AMERICAN ELECTRIC POWER COMPANY, INC., )
for certification pursuant to Section 33 of the )Case No. U11355
Public Utility Holding Company Act of 1935. )
At the May 7, 1997 meeting of the Michigan Public Service
Commission in Lansing, Michigan.
PRESENT: Hon. John G. Strand, Chairman
Hon. John C. Shea, Commissioner
Hon. David A. Svanda, Commissioner
OPINION AND ORDER
On March 27, 1997, American Electric Power Company, Inc.,
(AEP) filed an application for certification pursuant to Section 33
of the Public Utility Holding Company Act of 1935 (PUHCA), 15 USC
79z-5b. This certification will assist AEP in obtaining approval
from the Securities and Exchange Commission (SEC), pursuant to 17
CFR 250.53 (Rule 53), to issue securities.
In its application, AEP represents that it is a registered
public utility holding company pursuant to the provisions of PUHCA.
Indiana Michigan Power Company (I&M), an electric utility, is an
Indiana corporation that conducts business in Michigan as American
Electric Power. I&M is a wholly-owned subsidiary of AEP.
According to the application, AEP and AEP Resources, Inc.
(Resources), a wholly-owned subsidiary of AEP, filed a request with
the SEC for exemption from the requirements of Rule 53(a)(1), which
limits the aggregate investment in exempt wholesale generators
(EWGs) to 50% of the system's consolidated retained earnings. If
the SEC grants AEP's request, AEP may use the net proceeds of
authorized securities in an aggregate amount which, when added to
AEP's direct and indirect aggregate investment in all EWGs and
foreign utility companies (collectively, exempt projects) would not
at any time exceed AEP's consolidated retained earnings.
Rule 53(c) provides that a registered holding company that is
unable to satisfy the requirements of subsection (a) of that rule
must affirmatively demonstrate that its proposal will neither have
a substantial adverse effect upon the financial integrity of the
registered holding company system nor have an adverse effect on any
utility subsidiary of the registered holding company or its
customers or on the ability of state commissions to protect such
subsidiary or customers. AEP represents that the SEC has applied
the certification requirements found in 15 USC 79z-5b when making
determinations pursuant to Rule 53(c). Pursuant to the standards
in 15 USC 79z-5b, a general exemption for foreign utility company
affiliates is available, provided that each state commission with
jurisdiction over the retail rates of a public utility affiliate
certifies to the SEC that the state commission has the authority
and resources to protect ratepayers subject to its jurisdiction and
that it intends to exercise that authority.
AEP requests the Commission to certify that (1) the Commission
has reviewed AEP's request to the SEC, (2) the Commission has the
authority and resources to protect the Michigan ratepayers of I&M,
and (3) the Commission intends to exercise that authority.
AEP states that its consolidated retained earnings as of
December 31, 1996 were approximately $1.508 billion. It currently
has $470 million designated for exempt projects. Thus, if the
exemption is granted, AEP would be authorized to finance up to an
additional $1.038 billion in exempt project investments. AEP
represents that the authorization would allow the company to invest
in all exempt projects that it is presently developing, as well as
those that are under investigation at present or that might arise
in the future. AEP represents that these contemplated investments
will not negatively affect its ability to make additional necessary
equity investments in the AEP operating companies.
In support of its application, AEP filed a copy of its SEC
application, which details financial indicators to demonstrate the
financial strength of the company as well as the risks inherent in
exempt project investments and available measures to mitigate those
risks. AEP also represents that all exempt project investments are
and will remain segregated from the operating companies and that
I&M will not seek to recover from Michigan ratepayers any possible
losses that AEP may sustain on those investments or additional
revenue to offset an inadequate return on those investments.
The Commission finds that ex parte approval is appropriate.
After a review of the application, the Commission concludes that it
should grant the requested certification while reserving the right
to prospectively revoke it, as PUHCA permits, and on the condition
that AEP not seek to recover from ratepayers any direct or indirect
costs of the investment in exempt projects. Further, the granting
of the certificate is not an approval or endorsement of the
proposed transactions. Finally, as the Commission has required in
connection with other prior certifications, AEP and its affiliates
shall provide the Commission at least 30 days' notice of the intent
to make additional investments in exempt projects.
The Commission FINDS that:
a. Jurisdiction is pursuant to 1909 PA 106, as amended, MCL
460.551 et seq.; MSA 22.151 et seq.; 1919 PA 419, as amended, MCL
460.51 et seq.; MSA 22.1 et seq.; 1939 PA 3, as amended, MCL 460.1
et seq.; MSA 22.13(1) et seq.; 15 USC 79z-5b; 1969 PA 306, as
amended, MCL 24.201 et seq.; MSA 3.560(101) et seq.; and the
Commission's Rules of Practice and Procedure, as amended, 1992
AACS, R 460.17101 et seq.
b. The Commission has the authority and resources to protect
the Michigan ratepayers of I&M and intends to exercise that
authority for all exempt projects in which AEP or Resources seeks
to obtain an ownership interest.
c. Ex parte approval is appropriate.
THEREFORE, IT IS ORDERED that American Electric Power Company,
Inc.'s application for certification pursuant to Section 33 of the
Public Utility Holding Company Act of 1935, 15 USC 79z-5b, is
approved. The Commission has the authority and resources to
protect the ratepayers of Indiana Michigan Power Company and
intends to exercise that authority for all exempt projects in which
American Electric Power Company or AEP Resources, Inc., seeks to
obtain an ownership interest.
The Commission reserves jurisdiction and may issue further
orders as necessary.
Any party desiring to appeal this order must do so in the
appropriate court within 30 days after issuance and notice of this
order, pursuant to MCL 462.26; MSA 22.45.
MICHIGAN PUBLIC SERVICE COMMISSION
(SEAL)
/s/ John G. Strand
Chairman
/s/ John C. Shea
Commissioner
/s/ David A. Svanda
Commissioner, concurring in a separate opinion.
By its action of May 7, 1997.
/s/ Dorothy Wideman
Its Executive Secretary
STATE OF MICHIGAN
BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION
In the matter of the application of )
AMERICAN ELECTRIC POWER COMPANY, INC., )
for certification pursuant to Section 33 of the )Case No. U11355
Public Utility Holding Company Act of 1935. )
* * * * *
CONCURRING OPINION OF
COMMISSIONER DAVID A. SVANDA
(Submitted on May 7, 1997 concerning order issued on same date)
Today, I join with my colleagues in approving the application
of American Electric Power Company, Inc, (AEP) for certification
pursuant to Section 33 of the Public Utility Holding Company Act of
1935 (PUCHA), 15 USC 79z-5b. This certification will assist AEP in
obtaining approval from the Securities and Exchange Commission
(SEC), pursuant to 17 CFR 250.53 (Rule 53), to issue securities.
In the past, I have dissented from the majority opinion
approving applications for certification pursuant to Section
33(a)(2) of PUCHA on the grounds that foreign investment diverts
utility leadership, management, legal, financial, and analytical
talents from the implementation of a meaningful program of customer
choice in Michigan. I remain committed to this view. Customer
choice of electricity provider will provide the ultimate assurance
that Michigan electricity users will be insulated from the impact
of any failed investments of utility affiliates. Also, previous
applications for Section 33(a)(2) certification failed to provide
sufficient information as to the magnitude of the foreign
investment contemplated. Thus, it was impossible for me to
conclude that this Commission had the resources to protect
ratepayers subject to its jurisdiction or the intention to exercise
that authority.
Unlike the previous applicants, this certification involves a
registered public utility holding company subject to Rule 53 as
well as additional requirements of the PUCHA. Furthermore, AEP has
provided information in its application as to the magnitude of
potential investments in exempt wholesale generators (EWGs) and
foreign utility companies. This is far superior to a parade of
applications for PUCHA certification for specific investments
without any knowledge of the ultimate level of affiliate foreign
investment involved. Finally, I have been informed that the state
utility commissions responsible for regulating the remainder of the
affiliate companies of the AEP system have issued the required
certification. For this reason, and the reasons stated above, I
concur with the conclusion of the majority that this Commission has
the authority and resources to protect ratepayers of Indiana
Michigan Power Company (I&M) and intends to exercise that
authority.
MICHIGAN PUBLIC SERVICE COMMISSION
/s/ David A. Svanda
Commissioner
Exhibit A-4
May 1, 1997
Honorable Arthur Levitt
Chairman
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Dear Chairman Levitt:
RE: Application-Declaration of American Electric Power
Company, File No. 70-09021
American Electric Power Company, Inc. ("AEP"), Columbus Southern
Power Company ("CSPCo") and Ohio Power Company ("OPCo"), have
advised this Commission that AEP will be requesting your Commission
approval for an increase in its authority for investments in exempt
wholesale generators ("EWGs") and foreign utility companies
("FUCOs") beyond that permitted under existing AEP Orders. In
connection with such activities, AEP has requested that the Public
Utilities Commission of Ohio certify to you that such increased
investment authority in EWGs and FUCOs will not impair the ability
of this Commission to regulate CSPCo and OPCo or protect the
ratepayers of CSPCo and OPCO.
As the State commission having jurisdiction over the retail
electric rates of CSPCo and OPCo, please be advised that based on:
(1) this Commission's statutory authority and jurisdiction,
which is unaffected by this application, to supervise and
regulate CSPCo and OPCo and all matters relating to the
performance of their public duties and their charges
thereof, to protect the ratepayers of CSPCo and OPCo;
and,
(2) the representation that the assets of CSPCo and OPCo will
not be encumbered,
this Commission is of the view that AEP's proposal will not impair
the ability of this Commission to regulate CSPCo or OPCo or protect
its retail customers in Ohio.
This foregoing opinion of this Commission on AEP's proposal is
expressly conditioned on the provisions 1 and 2 above as well as
the representation set forth in AEP's Application and is subject to
being revised or withdrawn by this Commission in the future, if it
deems that action to be appropriate. AEP has represented that it
will timely inform this Commission when AEP actually acquires
ownership in FUCOs or EWGs pursuant to its proposal.
Sincerely,
/s/ Craig A. Glazer
Craig A. Glazer
Chairman
CAG:ct
cc: Office of Public Utility Regulation,
Securities and Exchange Commission
Exhibit A-5
April 15, 1997
Mr. Jonathan G. Katz
Secretary
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Dear Mr. Katz:
American Electric Power Company, Inc. ("AEP") and Kingsport Power
Company ("KgpCo") have advised this agency that AEP will be
requesting Commission approval for an increase in its authority for
investments in exempt wholesale generators ("EWGs") and foreign
utility companies ("FUCOs") beyond that permitted under existing
AEP Orders. In connection with such activities, AEP has requested
that the Tennessee Regulatory Authority ("TRA") provide to you a
certification of its authority to protect the ratepayers of KgpCo.
As the State agency having jurisdiction over the retail electric
rates of KgpCo, please be advised that the TRA:
1. has the authority and jurisdiction under TCA 65-4-104 to
protect the ratepayers of KgpCo, and
2. intends to exercise such authority.
In addition, we have been informed by KgpCo and AEP that this
change will have no detrimental effect on the cost of capital of
KgpCo. To the extent that this change does have a detrimental
effect on the cost of capital of KgpCo, KgpCo and AEP have
represented to us that they will not seek recovery through higher
rates to their customers in Tennessee in order to compensate for
any possible losses that may be sustained on investments in Exempt
Projects or for any inadequate returns on such investments.
This certification is not intended to suggest that the TRA has
reviewed AEP's request or that the TRA endorses AEP's request.
Sincerely,
/s/ Lynn Greer
Lynn Greer, Chairman
/s/ Sara Kyle
Sara Kyle, Director
/s/ Melvin Malone
Melvin Malone, Director
Exhibit A-6
June 24, 1997
Mr. Jonathan G. Katz
Secretary
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: American Electric Power Company, Inc.
SEC File No. 70-9021
Dear Mr. Katz:
American Electric Power Company, Inc. ("AEP") has requested
Securities and Exchange Commission ("SEC") approval for an increase
in its authority to invest in exempt wholesale generators and
foreign utility companies beyond that permitted under its existing
SEC authority. In connection with such proposal, Ms. Bonnie
Wilkinson, Assistant Director, has requested that the Virginia
State Corporation Commission ("SCC") provide the SEC with a
statement of its views concerning its ability to protect the
ratepayers of Appalachian Power Company ("APCO") in regard to AEP's
proposed transaction.
This Commission has jurisdiction over the retail electric
rates in Virginia of AEP's public utility subsidiary, APCO, and has
the statutory authority to supervise and regulate such electric
utilities in all matters relating to the performance of their
public duties and their charges therefor.
Please be advised that, based upon AEP's and APCO's letter of
June 20, 1997, to the SCC, copy enclosed, and upon AEP's above
filing with the SEC and representations and agreements made by AEP
and APCO in such documents, the SCC is of the opinion that AEP's
proposal will not impair the ability of the SCC to protect APCO and
its ratepayers in the Commonwealth of Virginia. The above
statement of the SCC is expressly subject to being revised or
withdrawn by the SCC if it deems such action to be appropriate in
the future.
Sincerely,
/s/ Stewart E. Farrar
Stewart E. Farrar
Solicitor General
SEF/tah
Enclosure
cc: Chairman Hullihen Williams Moore
Commissioner Theodore V. Morrison, Jr.
Commissioner Clinton Miller
A. A. Pena, Treasurer, American Electric Power Company
R. Daniel Carson, Jr., President, Appalachian Power
Company
Exhibit A-7
June 12, 1997
Honorable Arthur Levitt
Chairman
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: AEP, File No. 70-9021
Dear Chairman Levitt:
American Electric Power, Inc. ("AEP") has requested Securities and
Exchange Commission ("SEC") approval for an increase in its
authority for investments in exempt wholesale generator and foreign
utility companies beyond that permitted under existing SEC
authority. In connection with such activities, Ms. Bonnie
Wilkinson, Assistant Director, has requested that the West Virginia
Public Service Commission ("WVPSC") provide the SEC with a
certification of its ability to protect the ratepayers of
Appalachian Power Company ("APCo") and Wheeling Power Company
("WPCo") as a result of AEP's proposed transaction.
As one of the State commissions having jurisdiction over the retail
electric rates of AEP's public utility subsidiaries, APCo and WPCo,
please be advised that based upon AEP's letter of June 6, 1997 to
the WVPSC (a copy is enclosed), it is the WVPSC's understanding,
among other items, that in AEP's opinion, its proposal for
increased investment in exempt wholesale generators and foreign
utility companies will not have a detrimental effect on the cost of
capital of AEP, APCo or WPCo. Further, AEP agrees that if it is
determined by the WVPSC that there is a detrimental impact on such
cost of capital, it will not seek recovery through higher rates to
any West Virginia customers to compensate for any possible losses
that may be sustained on investments in exempt projects or foreign
utilities or for any inadequate return on such investment. In
reliance upon those representations and the following
considerations, the WVPSC is of the view that AEP's proposal will
not impair the ability of the WVPSC to protect APCo's and WPCo's
retail electric customers in West Virginia. The other
considerations include:
1. the WVPSC has statutory authority to supervise and
regulate electric utilities and all matters relating to
the performance of their public duties and their charges
therefor, and to correct any abuses of such utilities;
2. the representations set forth in AEP's application to the
SEC referenced above, including, but not limited to, the
representation that the assets of APCo and WPCo will not
be encumbered, combined with the representations
contained in AEP's letter of June 6, 1997; and
3. the requirement of Sec. 33(e)(2) of the Public Utility
Holding Company Act that AEP or APCo or WPCo will timely
inform this Commission when AEP or any subsidiary
actually acquires ownership in foreign utility companies
or exempt wholesale generators pursuant to its proposal.
The foregoing is expressly conditioned on and is subject to being
revised or withdrawn by this Commission, if it deems that action to
be appropriate.
Sincerely,
/s/ Charlotte R. Lane
Charlotte R. Lane
Chairman
CRL/cbd
Enclosure
cc: Otis D. Casto, Commissioner
Richard D. Frum, Commissioner
Richard E. Hitt, General Counsel
David J. Ellis, Director
