AUSTIN, Texas, Sept. 25, 2001 - American Electric Power (AEP) filed testimony Monday with the Public Utility Commission of Texas (PUCT) supporting a delay in retail competition until March 31, 2003, for areas of its Texas service territory within the Southwest Power Pool (SPP).

“We are asking that retail competition in the SPP areas of Texas be delayed to permit adequate time to assure that the infrastructure, processes and procedures are in place to allow fair competition to proceed while reliable service continues, “ said David Carpenter, AEP director of Texas regulatory services. “We also ask that the PUCT adopt milestones to be achieved prior to the commencement of retail competition.”

AEP’s Southwestern Electric Power subsidiary and a small portion of AEP’s West Texas Utilities (WTU) subsidiary are located within SPP. SWEPCO’s Texas service territory includes all of the East Texas areas served by the company, totaling over 162,000 customers. SWEPCO also serves customers in Louisiana and Arkansas. For WTU, portions of Childress, Collingsworth, Donley, Hall and Wheeler counties are included for a total of 7,144 customers.

Retail competition is scheduled to begin in Texas on Jan. 1, 2002.

“Recent orders from the Federal Energy Regulatory Commission have resulted in uncertainties as to the independent organization that will oversee retail competition in the SPP and ensure fair access to the transmission system by competitive retailers,” said Carpenter. “Also, various parties have expressed concerns about the lack of participation in the current retail pilot in the SPP. The delay is necessary to put in place the independent organization and systems and processes to support competition and continued reliable service.”

The delay will allow time for necessary milestones to be completed before the start of retail competition. The milestones include putting in place an independent organization to support retail competition in the Texas SPP areas of SWEPCO and WTU, developing or modifying necessary systems and processes for retail competition and completing a pilot project to test the systems and procedures after they are completed. These steps will require a delay of retail competition in these areas until March 31, 2003.

“AEP continues to support retail competition and will work with the PUCT and the parties to complete these milestones and start retail competition in the SPP by March 31, 2003,” said Carpenter.

SWEPCO and WTU propose to continue charging their SPP customers the base rates currently in effect. Fuel factors will be established consistent with the PUCT’s current rules.

American Electric Power is a multinational energy company based in Columbus, Ohio. AEP owns and operates more than 38,000 megawatts of generating capacity, making it America’s largest generator of electricity. The company is also a leading wholesale energy marketer and trader, ranking second in the U.S. in electricity volume with a growing presence in natural gas. AEP provides retail electricity to more than 7 million customers worldwide and has holdings in the U.S. and select international markets. Wholly owned subsidiaries are involved in power engineering and construction services, energy management and telecommunications.