2
Fortune magazine, April 2, 2007
Over 11 graphics in this issue alone dealing with the environment and positive economics……
9
“With over 800 environmentally responsible, high quality papers, using DOMTAR EarthChoice helps protect his world and yours.”
“DOMTAR EarthChoice …. high quality paper with a conscience.”
11
“… the sky is the limit……Because for all of us at ADM, there are no limits to a cleaner, greener world.”
13
AEP: An Introduction
Among the largest U.S. electricity generators with 39,000 MW
America’s largest coal user
The nation’s largest electrical transmission system
>240,000 miles of T&D
A large consumerof natural gas
Major wind developer
5 million customers in 11 states
AEP Fuel Portfolio: Increasingly Diverse
Coal Gas Nuclear Hydro Wind
1998 88% 0% 9% 3% 0%
Today 70% 20% 7% 2% 1%
14
AEP is America’s Largest Coal User
Coal consumed
(~million tons / yr.)
Coal combustion products (CCPs)
produced (~million tons / yr.)
AEP 75 8
In all of the U.S. 943 75
15
Sustainability …..
The ability to meet our present needs
without compromising the ability of future
generations to meet theirs
16
AEP’s 2006 Corporate Responsibility Report
Our Vision for Sustainability
• safely provide reliable, reasonably priced electric power
• actively work to protect people and the environment.
• engage stakeholders
• continue our role in making people’s lives better today and for generations to come
17
Waste-to-Profit at AEP is enterprise-wide
• Asset Recovery
• Environmental Services
• Information Technology
• Generation
• Transmission
• Distribution
• Telecommunications
• Materials Services
• Fleet
• Workplace Services
• Land Management
• Procurement
• Aviation
18
Disposition Hierarchy
redeploy re-stock sell scrap donate pay to dispose
Asset Recovery Group
• Take surplus assets
• generate revenue
• balance risk
• address environmental concerns
• support customers’ missions
19
Representative Projects
• CCP utilization
• Power Plant demolition and salvage– electric motors– spare parts– scrap metals
• Spent Selective Catalytic Reduction (SCR) catalyst modules
• Used electrical equipment / transformers
• Information Technology equipment
• Mobile phones
20
2006 - - Waste-to-Profit examples
Scrap Metal sales $8.8 million
Material sales $3.4 million from:
• Generation = $2.0 million• Utility = $1.3 million• Other = $62,000
Cost avoidance / savings $2.2 million_____________________ __________________________
Total $14.4 million(CCPs not included)
21
Coal Combustion Products (CCPs)
• CCP production and utilization at AEP– burned 74.8 million tons of coal in 2005 at 22 power plants– produced 8.2 million tons of CCPs– utilized 44% in concrete, structural fill, ice control (grit), etc.– represents ~$18 million / year in revenues and avoided costs
• CCP utilized in:– concrete, concrete block, road base asphalt and ice control– flowable fill and structural fill– paint manufacturing, Corvette body production, blasting grit, amber
glass manufacturing, roofing shingles and wallboard– mined land reclamation (both contours and AMD treatment)
30
Biomass co-firing at Picway Plant
Utilizing cabinet maker’s waste wood to augment coal-fired production of electricity
34
Used Electrical Equipment
• Some used electrical equipment is rebuilt
• Partially offsets cost of new units
35
IT End-of-Life Program• contract is in place to take used IT equipment and refurbish or recycle• AEP Asset Recovery is working to improve the return
36
AEP’s CO2 Capture and Enhanced Oil Recovery
Northeastern Station 3&4
• chilled ammonia process for capturing CO2 emissions from two AEP power plants :
• initial validation at Mountaineer Plant (4Q 2008)
• commercial-scale at Northeastern Plant in OK (late 2011)
• 1.5 million tons of CO2/year captured & sequestered
• approximate capital cost of ~$250-300 million
• annual O&M of ~$12 million
• Enhanced Oil Recovery - - Used to increase production from mature oil fields
• water or gas traditionally was injected to increase pressure but recently are seeing CO2 being used
• sell the captured CO2 for Enhanced Oil Recovery in Oklahoma ~ End ~