AEP has taken action on data reporting, company says in response to FERC

COLUMBUS, Ohio, June 13, 2003 - American Electric Power (NYSE: AEP) has taken appropriate actions to ensure that energy-trading data is accurately reported for use in trade media indexes, the company said today in a response to a Federal Energy Regulatory Commission (FERC) order.

On April 30, FERC issued an order providing AEP and 10 other companies 45 days to show they have corrected internal processes for reporting trading data to industry publications. The other 10 companies include subsidiaries of Aquila, Coral Energy, CMS Energy, Dynegy, Duke Energy, El Paso, Mirant, Reliant Resources, Sempra Energy, and The Williams Companies.

“In October 2002, AEP responded swiftly to concerns regarding possible misreporting of trade data and implemented corrective measures to ensure the accuracy of all future reporting of data to trade press,” AEP said in the response filed today.

“More specifically, upon learning that five of its employees had acknowledged misreporting to the trade press, AEP: (1) changed the procedures for reporting natural gas trades to ensure that price information for use in market indexes is verified and reported by the office of AEP’s Chief Risk Officer; (2) required all of its natural gas traders to certify in writing that they had neither engaged in misreporting nor been directed to do so by others or, alternatively, to explain why they could not make such a certification; (3) dismissed the five traders who could not make the above certification and who acknowledged misreporting for violating the Company’s principles of business conduct; and (4) reported the problem to federal agencies and publicly disclosed it,” the company said in the response.

“Following the termination of employment of those five employees, AEP had an outside law firm further investigate the facts relating to misreporting to the trade press. Its investigation has found no basis for concluding that any current AEP employees intentionally reported inaccurate information to the trade press,” the company said in the response.

AEP’s response also provides information on the company’s Code of Conduct that was established in 1994, current internal controls on reporting trades to industry publications, cooperation with various government agencies reviewing trade press misreporting, and other steps taken by the company that affect the reporting of trade data.

AEP’s response to FERC is available on the company’s web site: http://www.aep.com/newsroom/resources/docs/FERCfiling_06_03.pdf.

American Electric Power owns and operates more than 42,000 megawatts of generating capacity in the United States and select international markets and is the largest electricity generator in the U.S. AEP is also one of the largest electric utilities in the United States, with almost 5 million customers linked to AEP’s 11-state electricity transmission and distribution grid. The company is based in Columbus, Ohio.

Pat D. Hemlepp
Director, Corporate Media Relations
American Electric Power