COLUMBUS, Ohio, Dec. 19, 2000 -- Following an extensive engineering and technical review, and aided by recent technological developments, American Electric Power (NYSE: AEP) is changing the design of the selective catalytic reduction (SCR) system it will install at its Gen. James M. Gavin Plant at Cheshire, Ohio.

Company officials announced plans to employ a urea-based system as the source of ammonia for the plant’s SCR system, which will begin operation in the spring of 2001. Previously, the company had announced that anhydrous ammonia would be used in the SCR system to achieve the reductions in nitrogen oxide (NOx) emissions that are being required by the U.S. Environmental Protection Agency.

"Our neighbors in and around Cheshire told us they were very concerned about the impact of a serious accident involving a major release of anhydrous ammonia due to their close proximity to the plant," said John Norris, AEP’s senior vice president of operations and technical services.

"We took those concerns to heart," Norris said. "Safety is a primary concern in everything we do. We’ve spent considerable effort reviewing our original analysis and seeking new information to see if we could find another way to meet our emission reduction obligations and address the community’s concerns at the same time. We have found a solution that meets both of these needs."

Norris said that the decision represents a significant commitment on AEP´s part. While the switch to a urea system will increase both the construction and the operating costs of the plant over its remaining life, it will also eliminate the need to store large amounts of anhydrous ammonia at the plant. Norris emphasized that health and safety issues were taking precedence over cost considerations.The announcement came at a community forum Dec. 18 arranged by the company at River Valley High School, near Cheshire. The meeting was a follow-up to an earlier forum where area residents raised objections to the proposed use of anhydrous ammonia.

Duane Phlegar, general manager of Gavin Plant, explained that the company values its relationship with the local community. "The urea-based system will eliminate concerns about the transportation and storage of anhydrous ammonia at the plant," he said.

The SCR system uses a chemical reaction to break down NOx present in the exhaust gases that are released during the coal combustion process. Ammonia is added to the flue gases, which are then channeled through a catalyst that breaks down the gases into elemental nitrogen and water. AEP and other power generators in the Midwest and Southeast are required by federal mandate to reduce their NOx emissions by May 2003.

A urea-based system does not involve the storage of anhydrous ammonia at the plant site. Instead, urea -- a dry, granular or pelleted nitrogen fertilizer -- will be converted to ammonia just prior to the point at which it is injected into the plant’s exhaust gases. Storage of urea in its dry, granular form does not pose any extraordinary handling challenges or potential health hazards that require the development of emergency response plans.

Phlegar explained that AEP plans to utilize an expedited project management schedule in order to engineer, design and install the urea-based system for both units at Gavin Plant in time for the 2001 ozone season (May through September). Since urea-based technology has never been tested or installed on a power plant of Gavin’s size, however, he noted that the plant may encounter some start-up challenges when the SCR system begins full-scale operation. He expressed confidence, however, that the company can engineer a successful urea system for Gavin Plant. The Gavin Plant consists of two 1300-megawatt coal-fired generating units and is the largest generating station in Ohio.

Norris stated that the company conducted a comprehensive evaluation, including the possible use of aqueous ammonia -- a less concentrated form of ammonia -- for the SCR system.

"We recognize that nearly three months have elapsed since we held our first community forum," Phlegar said. "To put it simply, conducting these detailed studies and evaluating all of the possible alternatives took longer than we originally anticipated. A urea-based SCR system has been installed only very recently in two power plants in the entire country, and those units are much smaller than the Gavin units. It took a great deal of study before we were able to conclude that we can take this technology and scale it up successfully to a plant of Gavin’s size."

American Electric Power is a multinational energy company based in Columbus, Ohio. AEP is one of the United States´ largest generators of electricity with more than 38,000 megawatts of generating capacity. AEP is also one of the nation´s leading wholesale energy marketers and traders. AEP delivers electricity to more than 4.8 million customers in 11 states -- Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia and West Virginia. The company serves more than 4 million customers outside the U.S. through holdings in Australia, Brazil, China, Mexico and the United Kingdom. Wholly owned subsidiaries are involved in power engineering, construction, energy management and telecommunications services.