COLUMBUS, Ohio, Jan. 31, 2006 – American Electric Power (NYSE: AEP) today filed with the Federal Energy Regulatory Commission (FERC) and the PJM Interconnection (PJM) to build a new 765-kilovolt (kV) transmission line stretching from West Virginia to New Jersey. The proposed transmission superhighway will span approximately 550 miles and is designed to reduce PJM congestion costs by substantially improving west-east transfer capability by approximately 5,000 megawatts (MW) and reducing transmission line losses by approximately 280 MW. It also will enhance reliability in the eastern transmission grid.

“We must move forward and address the current inadequacies of our nation’s existing transmission infrastructure. Congress and the Federal Energy Regulatory Commission have identified that investment in transmission is crucial to ensure the reliability of the electricity grid and the growth potential of our economy,” said Michael G. Morris, AEP’s chairman, president and chief executive officer. “It makes sense that AEP would be the first to step up and propose a new transmission superhighway to address issues plaguing the eastern transmission grid. AEP was the first utility in the United States to recognize the value of investing in a network of 765-kV transmission lines, the highest-voltage transmission ever built, to move power from remote generators to load centers. Today, AEP’s 765-kV network, which stretches more than 2,000 miles, is arguably the most reliable, efficient transmission network in the United States.

“Additional high-voltage transmission highways are absolutely necessary to relieve congestion within the eastern grid. In 2004, PJM transmission congestion costs totaled approximately $800 million, and in 2005, congestion costs are expected to exceed $1 billion. These costs are reflected in higher wholesale electricity prices, particularly during peak demand periods, when available, lower-cost electricity can’t be transported to where it is needed. This line will reduce those congestion costs, cut line losses, enhance reliability and provide the transmission capacity and flexibility that is critical for construction of new fuel-diverse generation, including renewables,” Morris said.

AEP’s proposed transmission line, called the AEP Interstate Project, would originate at AEP’s Amos transmission station in Putnam County, W.Va., connect through Doubs Station in Frederick County, Md., and terminate at the Deans Station in Middlesex County, N.J. The proposed route follows a corridor conceptually identified by PJM as Project Mountaineer, a transmission route needed to address critical transmission congestion within the PJM footprint. Exact routing of the line would be determined after PJM approves the project. AEP will work with PJM, other affected transmission owners and stakeholders throughout the siting process.

AEP also has filed with the Department of Energy to have the proposed route designated as a National Interest Electric Transmission Corridor (NIETC). The Energy Policy Act of 2005 provides for NIETC designation for areas that are experiencing electric energy transmission capacity constraints or congestion that adversely affects consumers.

A new AEP subsidiary, AEP Transmission Co., LLC, will own the line and undertake construction of the project. The projected cost is approximately $3 billion. The anticipated in-service date is 2014 assuming three years to site and acquire rights-of-way and five years to build the line.

[For more information, including a route map and frequently-asked questions, please see the special section devoted to the AEP Interstate Project on our Web site.]

American Electric Power is one of the largest electric utilities in the United States, delivering electricity to more than 5 million customers in 11 states. AEP is the nation’s largest generator of electricity, owning more than 36,000 megawatts of generating capacity in the U.S. AEP also owns the nation’s largest electricity transmission system, a nearly 39,000-mile network that includes more 765-kilovolt extra-high voltage transmission lines than all other U.S. transmission systems combined. AEP’s utility units operate as AEP Ohio, AEP Texas, Appalachian Power (in Virginia, West Virginia and Tennessee), Indiana Michigan Power, Kentucky Power, Public Service Company of Oklahoma, and Southwestern Electric Power Company (in Arkansas, Louisiana and east Texas). American Electric Power, based in Columbus, Ohio, is celebrating its 100th anniversary in 2006.
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This report made by AEP and certain of its subsidiaries 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: electric load and customer growth; weather conditions, including storms; available sources and costs of, and transportation for, fuels and the creditworthiness of fuel suppliers and transporters; availability of generating capacity and the performance of AEP’s generating plants; the ability to recover regulatory assets and stranded costs in connection with deregulation; the ability to recover increases in fuel and other energy costs through regulated or competitive electric rates; new legislation, litigation and government regulation including requirements for reduced emissions of sulfur, nitrogen, mercury, carbon and other substances; timing and resolution of pending and future rate cases, negotiations and other regulatory decisions (including rate or other recovery for new investments, transmission service and environmental compliance);resolution of litigation (including pending Clean Air Act enforcement actions and disputes arising from the bankruptcy of Enron Corp.); AEP´s ability to constrain its operation and maintenance costs; AEP´s ability to sell assets at acceptable prices and on other acceptable terms, including rights to share in earnings derived from the assets subsequent to their sale; the economic climate and growth in AEP´s service territory and changes in market demand and demographic patterns; inflationary and interest rate trends; AEP´s ability to develop and execute a strategy based on a view regarding prices of electricity, natural gas, and other energy-related commodities; changes in the creditworthiness of the counterparties with whom AEP has contractual arrangements, including participants in the energy trading market; changes in the financial markets, particularly those affecting the availability of capital and AEP´s ability to refinance existing debt at attractive rates; actions of rating agencies, including changes in the ratings of debt; volatility and changes in markets for electricity, natural gas, and other energy-related commodities; changes in utility regulation, including membership in regional transmission structures; accounting pronouncements periodically issued by accounting standard-setting bodies; the performance of AEP´s pension and other postretirement benefit plans; prices for power that AEP generates and sells at wholesale; changes in technology, particularly with respect to new, developing or alternative sources of generation, and other risks and unforeseen events, including wars, the effects of terrorism (including increased security costs), embargoes and other catastrophic events.