American Electric Power : Citi 2024 Energy Conference Handout

Citi 2024 Energy Conference

Boston, MA

May 14, 2024

meaning of Section 21E of the Securities Exchange Act of 1934. Although AEP and each based on reasonable assumptions, any such statements may be influenced by factors that

from those projected. Among the factors that could cause actual results to differ

in economic conditions, electric market demand and demographic patterns in AEP disruption of AEP's business operations due to impacts on economic or market conditions, employees' reactions to those regulations, electricity usage, supply chain issues, customers, of escalating global trade tensions including the conflict between Russia and Ukraine, and the

inflationary or deflationary interest rate trends, volatility in the financial markets,

to finance new capital projects and refinance existing debt, the availability and cost of

1. if expected sources of capital, such as proceeds from the sale of assets or subsidiaries, do incurring costs and recovery is long and the costs are material, decreased demand for
   and the ability to recover significant storm restoration costs, the cost of fuel and its and transporters and the cost of storing and disposing of used fuel, including coal ash capacity and performance of generation plants, the ability to recover fuel and other

ability to transition from fossil generation and the ability to build or acquire renewable to obtain any necessary regulatory approvals and permits) when needed at acceptable

those costs, new legislation, litigation and government regulation, including changes to commodity trading and new or heightened requirements for reduced emissions of sulfur, substances that could impact the continued operation, cost recovery and/or profitability of legislation on results of operations, financial condition, cash flows or credit ratings, the risks

the fuels used or the byproducts and wastes of such fuels, including coal ash and spent negotiations and other regulatory decisions, including rate or other recovery of new

and environmental compliance, resolution of litigation, the ability to constrain operation and sold at wholesale, changes in technology, particularly with respect to energy storage and the ability to recover through rates any remaining unrecovered investment in generation

useful lives, volatility and changes in markets for coal and other energy-related hanges in utility regulation and the allocation of costs within regional transmission

creditworthiness of the counterparties with contractual arrangements, including participants changes in the ratings of debt, the impact of volatility in the capital markets on the value of plans, captive insurance entity and nuclear decommissioning trust and the impact of such

periodically issued by accounting standard-setting bodies, and other risks and unforeseen (including increased security costs), embargoes, naturally occurring and human-caused

ability to attract and retain requisite work force and key personnel.

1

"Safe Harbor"

Statement Under the

Private Securities

Litigation Reform

Act of 1995

Darcy Reese, Vice President

Investor Relations 614-716-2614 [e-mail]

Annie Pribisko, Director

Investor Relations 614-716-2646 [e-mail]

This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Although AEP and each of its Registrant Subsidiaries believe that their expectations are based on reasonable assumptions, any such statements may be influenced by factors that could cause actual outcomes and results to be materially different from those projected. Among the factors that could cause actual results to differ materially from those in the forward-looking statements are: changes in economic conditions, electric market demand and demographic patterns in AEP service territories, the economic impact of increased global trade tensions including the conflicts in Ukraine and the Middle East, and the adoption or expansion of economic sanctions or trade restrictions, inflationary or deflationary interest rate trends, volatility and disruptions in the financial markets precipitated by any cause including failure to make progress on federal budget or debt ceiling matters or instability in the banking industry, particularly developments affecting the availability or cost of capital to finance new capital projects and refinance existing debt, the availability and cost of funds to finance working capital and capital needs, particularly (i) if expected sources of capital, such as proceeds from the sale of assets, subsidiaries and tax credits, and anticipated securitizations do not materialize, and (ii) during periods when the time lag between incurring costs and recovery is long and the costs are material, decreased demand for electricity, weather conditions, including storms and drought conditions, and the ability to recover significant storm restoration costs, limitations or restrictions on the amounts and types of insurance available to cover losses that might arise in connection with natural disasters or operations, the cost of fuel and its transportation, the creditworthiness and performance of fuel suppliers and transporters and the cost of storing and disposing of used fuel, including coal ash and spent nuclear fuel, the availability of fuel and necessary generation capacity and performance of generation plants, the ability to recover fuel and other energy costs through regulated or competitive electric rates, the ability to transition from fossil generation and the ability to build or acquire renewable generation, transmission lines and facilities (including the ability to obtain any necessary regulatory approvals and permits) when needed at acceptable prices and terms, including favorable tax treatment, meet cost caps imposed by regulators and other operational commitments to regulatory commissions and customers for renewable generation projects, and to recover all related costs, the impact of pandemics and any associated disruption of AEP's business operations due to impacts on economic or market conditions, costs of compliance with potential government regulations, electricity usage, supply chain issues, customers, service providers, vendors and suppliers, new legislation, litigation or government regulation, including changes to tax laws and regulations, oversight of nuclear generation, energy commodity trading and new or heightened requirements for reduced emissions of sulfur, nitrogen, mercury, carbon, soot or particulate matter and other substances that could impact the continued operation, cost recovery and/or profitability of generation plants and related assets, the impact of federal tax legislation on results of operations, financial condition, cash flows or credit ratings, the risks before, during and after generation of electricity associated with the fuels used or the byproducts and wastes of such fuels, including coal ash and spent nuclear fuel, timing and resolution of pending and future rate cases, negotiations and other regulatory decisions, including rate or other recovery of new investments in generation, distribution and transmission service and environmental compliance, resolution of litigation or regulatory proceedings or investigation, the ability to efficiently manage operation and maintenance costs, prices and demand for power generated and sold at wholesale, changes in technology, particularly with respect to energy storage and new, developing, alternative or distributed sources of generation, the ability to recover through rates any remaining unrecovered investment in generation units that may be retired before the end of their previously projected useful lives, volatility and changes in markets for coal and other energy-related commodities, particularly changes in the price of natural gas, the impact of changing expectations and demands of customers, regulators, investors and stakeholders, including focus on environmental, social and governance concerns, changes in utility regulation and the allocation of costs within regional transmission organizations, including ERCOT, PJM and SPP, changes in the creditworthiness of the counterparties with contractual arrangements, including participants in the energy trading market, actions of rating agencies, including changes in the ratings of debt, the impact of volatility in the capital markets on the value of the investments held by the pension, other postretirement benefit plans, captive insurance entity and nuclear decommissioning trust and the impact of such volatility on future funding requirements, accounting standards periodically issued by accounting standard-setting bodies, and other risks and unforeseen events, including wars and military conflicts, the effects of terrorism (including increased security costs), embargoes, wildfires, cyber security threats and other catastrophic events, the ability to attract and retain requisite work force and key personnel.

Citi 2024 Energy Conference

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AEP Is a Pure

Play Regulated

Utility

40K	$98B
TRANSMISSION MILES	TOTAL ASSETS
Nation's largest electric	Strong balance sheet
transmission system	As of March 31, 2024
225K	$66B
DISTRIBUTION MILES	RATE BASE
One of the largest distribution	Solid rate base growth
systems in the U.S.
23GW	$48B
OWNED GENERATION	CURRENT MARKET
Diverse generation fleet	CAPITALIZATION
As of March 31, 2024	As of May 10, 2024

17,000

EMPLOYEES

Across the system

5.6M

CUSTOMERS

Throughout 11 states

Statistics are as of December 31, 2023, unless separately disclosed.

Citi 2024 Energy Conference

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AEP Investment Thesis

Powering the Future as One of the Largest Utilities in the U.S. by Rate Base and Market Cap

Delivering Consistent, Strong Performance

• Commitment to 6%-7% annual operating earnings growth; dividend growth is in line with earnings
• 10%-11%consistent total shareholder return
• Strong balance sheet with a targeted FFO/Debt of 14%-15%
• 2024 operating earnings guidance range of $5.53-$5.73
• Advancing positive regulatory strategies to close the ROE gap

Operating Attractive Transmission and Distribution Assets

• Largest transmission provider in the U.S. and one of the largest distribution providers in the U.S.
• Bolstered by organic growth with diversity in geographic footprint and customer base
• Flexible and robust capital plan of $43B includes $16B of transmission investment and $11.3B of distribution investment
• High-growthtransmission business supported by stable, predictable and transparent revenue stream

Leading the Clean Energy Transition

• Proven track record of investing in sustainability and reducing fleet emissions
• Plans to add 20 GW of new resource opportunities between 2024 and 2033
• Target of net zero by 2045
• Capital forecast includes $9.4B of regulated renewable investment

Focusing on the Customer and Actively Managing the Business

• Improved customer rate outlook with a 3% annual bill increase over the 2024- 2028 forecasted period enabled by renewables and economic development activities
• Immediate-termfocus on simplifying business; continued execution of sale processes
• Thoughtful and proactive portfolio management and investment to support strategy
• Strong employee base led by experienced leaders with a shared passion for the AEP mission

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Proven Track

Record of EPS

Performance

Over a decade of meeting or exceeding original EPS guidance

• 2024 operating EPS guidance is $5.53-$5.73.

Actual Result

Citi 2024 Energy Conference

Actual operating EPS in comparison to original EPS guidance range

LOW	MID
END	POINT

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

20241

HIGH	EXCEEDING
END	GUIDANCE RANGE

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Strong Dividend Growth

Targeted payout ratio 60-70% of operating earnings

Over 113 years of consecutive quarterly dividends

Targeted dividend growth in line with earnings

• Targeted dividend growth is in-line with 6%-7% annual operating earnings growth, subject to approval by Board of Directors.

$4.00

$3.58

$3.50							$3.37
							$3.17
							$3.00
$3.00							$2.84
						$2.71
						$2.39	$2.53
$2.50
					$2.27
					$2.15
			$1.95	$2.03
		$1.88
	$1.85
$2.00
	$1.71

$1.50

$1.00

$0.50

$-
																	2024E1
2010	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020	2021	2022	2023
				4%-6%						5%-7%					6%-7%

Earnings Growth Rate

EPS Growth + Dividend Yield = 10% to 11% Annual Return Opportunity

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Positioning for the Future

2024-2028 Capital Forecast

Rate Base Growth

Efficient Cost Recovery Mechanisms

2024-2028 Cash Flows and Financial Metrics

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2024-2028 Capital Forecast of $43B

The ability to quickly redeploy transmission and distribution investment ensures we deliver on our 6-7% EPS growth commitment while mitigating customer bill impact

On a system average, we expect rates to go up approximately 3% annually over the forecasted period

A balanced, flexible and robust capital plan designed to meet our customers needs

		Regulated New
Other Generation	Nuclear	Generation
$1.2B • 3%	$0.5B • 1%
Generation
	Corporate
	$0.4B • 1%	$3.5B • 8%
Regulated
Environmental
Generation
$0.3B • 1%
		Distribution
		$11.3B • 27%
Regulated
Renewables	$43B
$9.4B • 22%	TOTAL

AEP Transmission

Transmission $9.8B • 23%

Holdco

$6.2B • 14%

100%

of capital allocated to regulated businesses

$27B 64%

allocated to wires

$9B 22%

allocated to regulated renewables

7.2%

resulting rate base

CAGR

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2024-2028 Capital Forecast by Subsidiary

Capital plans are continuously optimized which may result in redeployment between functions and companies.

$ in millions, excludes AFUDC

Appalachian Power Company

Wheeling Power Company

Kingsport Power Company

Indiana Michigan Power Company

Kentucky Power Company

AEP Ohio

Public Service Company of Oklahoma

Southwestern Electric Power Company

AEP Texas Company

AEP Generating Company

AEP Transmission Holdco

Other

2024E

• 963 $ 85 $ 30
• 579
• 166

• 1,034 $ 569

$ 1,176

• 1,533 $ 10

• 1,338 $ 61

2025E

• 1,447 $ 59 $ 24 $ 923 $ 158 $ 883

$ 1,848

$ 2,242

• 1,420 $ 6

• 1,031 $ 184

2026E

• 1,400 $ 64 $ 28

• 1,101 $ 164 $ 855

$ 1,580

$ 736

• 1,451 $ 6

• 1,094 $ 92

2027E

• 865 $ 52 $ 21
• 827
• 163
• 922
• 710

$ 856

• 1,349 $ 7

• 1,203 $ 113

2028E

• 1,063 $ 60 $ 22

• 1,388 $ 185 $ 872 $ 749

$ 1,650

• 1,448 $ 5

• 1,574 $ 111

Total

• 5,738 $ 320 $ 125

• 4,818 $ 836

• 4,566
• 5,456

$ 6,660

• 7,201 $ 34

• 6,240 $ 561

Total Capital and Equity Contributions

$ 7,544

$ 10,225

$ 8,571

$ 7,088

$ 9,127

$ 42,555

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7.2% CAGR in Rate Base Growth

Cumulative change from 2020 base

6-7% EPS growth is predicated on regulated rate base growth

2020 RATE BASE PROXY
Vertically Integrated Utilities	$27.2B
T&D Utilities	$13.8B
Transcos/Transource	$9.4B
TOTAL	$50.4B

(in billions)
$22
$21
																							$37.3B
$20
																					$32.4B
$19
																						$18.0
$18
																			$29.5B
$17
$16																					$15.5
																		$14.7
$15																$24.8B
$14
$13
											$18.1B	$12.1							$12.3
$12
																				$10.9
$11
								$15.4B
$10																	$9.5
				$11.4B
$9											$8.0
$8							$7.6		$7.6							$7.0
$7		$5.6B	$6.6						$6.3									$6.0
$6
												$4.7	$5.3
$5							$4.5
							$4.2
$4	$3.5					$3.3
$3				$2.5 $2.3
$2
$1.1 $1.0
$1
$0
	2021A		2022A			2023A		2024E				2025E			2026E		2027E		2028E
								Vertically Integrated Utilities			T&D Utilities		Transcos/Transource

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