FORT WAYNE, Ind., Sept. 15, 2023 – Indiana Michigan Power (I&M), an American Electric Power (Nasdaq: AEP) company, submitted its customer-focused Powering Our Future plan to the Michigan Public Service Commission on Friday.

The plan outlines the next steps I&M is proposing to better serve customers. Key elements of the plan include infrastructure investments that result in a more reliable and resilient electric grid and a detailed evaluation of extending the future of Cook Nuclear Plant beyond its current license expirations.

In addition to the Cook study, the Powering Our Future plan benefits customers by:

• Replacing old equipment, increasing the frequency of planned tree-trimming and installing new grid technologies, all of which will result in fewer and shorter power outages.
• Relocating and rebuilding about 45 miles of power lines from hard-to-access areas to roadsides, giving crews quicker access to perform maintenance and repairs to lines and related equipment.
• Providing residential customers with more bill payment options that meet their needs and lifestyles.
• Using technology to provide an improved customer experience through better access to account information, shorter customer service call times and overall improved communication options.
• Pursuing federal grants to reduce costs, improve reliability and help communities succeed.
• Continuing programs that eliminate the residential service charge for income-qualified customers and reducing rates for senior citizens who use less than 900 kilowatt-hours (kWh) of energy per month.
• Expanding the Distributed Generation program for residential customers eligible to receive credits for the solar and wind power they generate and provide to the electric grid.

Powering Our Future emphasizes continued improvements so fewer customers lose power and their power is restored faster. I&M’s ongoing improvements to the electric grid over the past five years have led to a reduction in the time customers have been without power and I&M’s proposed infrastructure investments in this plan are expected to continue this trend.

In order to continue building on these successful efforts to maintain a strong electric grid and provide safe and reliable service to customers, I&M has requested a rate increase of about $34 million, or 9.67%.

Under the proposal, the bill for a typical residential customer who uses 1,000 kWh of electricity a month would go from $162.96 to $177.90 per month. The new rates will vary for residential, commercial, and industrial customers based on specific rate classifications.

I&M’s proposal could also result in lower rates over time if the company receives tax credits and federal or state grants to offset future project costs.

I&M carefully weighs the impact that every project has on the cost of service to customers. The company’s goal is to find a balance between affordability and investments that are necessary to improve reliability and public safety. In addition, the company continually reviews its operations and looks for ways to be more efficient and cost-effective.

“Indiana Michigan Power is committed to our customers because we know they rely on us to power their homes, businesses and industries. Our focus is keeping the lights on, consistently improving reliability and providing excellent customer service,” said Steve Baker, I&M president and chief operating officer. “We recognize that costs are rising, environmental and regulatory policies are changing, and customer needs and technologies are evolving. With Powering Our Future, I&M has identified the key steps we must take to address those realities while continuing to control costs and customer rates.”

Infrastructure and Reliability

Powering Our Future is key to I&M’s ongoing efforts to address aging infrastructure, enhance reliability, safeguard the public and make the system more resilient to weather events.

In 2023–2024, I&M proposes investing nearly $550 million in the infrastructure necessary to reliably deliver electricity from power plants to our customers’ homes and businesses and prepare I&M for the grid of the future.

With a growing number of I&M’s poles, wires and other equipment reaching the end of their expected life spans, I&M is systematically prioritizing infrastructure replacements and incorporating new technologies to improve the system. For example, with Powering Our Future, I&M will replace more than 850 aging poles and 93 miles of power lines.  

Trees, branches and limbs interfering with I&M’s lines are a major cause of power outages. I&M’s plan would accelerate its tree-trimming program to trim vegetation near overhead power lines every four years instead of the current five-year cycle.

Under Powering Our Future, I&M will relocate 55 sections of hard-to-access power lines over about 45 miles of terrain that includes dense vegetation, rivers, lakes and fire lanes. Making these line sections more accessible helps with safer and faster restoration of electric service.

I&M’s continued commitment to improve reliability is producing benefits for our customers. The number of total minutes customers were without power dropped by 25% (excluding major storms) over the past five years.

I&M continues to increase its use of smart technology to detect outages and automatically re-route electricity to restore service more quickly to a larger number of customers.

I&M’s approach is a thoughtful, reasoned, flexible process to complete the right projects at a reasonable cost to ensure reliable service.

Cook Nuclear Plant

Cook Nuclear Plant, located in Bridgman, plays a key role in meeting I&M customers’ energy needs – with zero carbon emissions. Cook Plant has two units that separately generate power and are licensed through 2034 and 2037, respectively. Though those dates are over a decade away, the process for extending the license of a nuclear plant is lengthy and requires significant advance work.

Cook Plant generates enough energy to power the equivalent of 1.5 million homes. Cook Plant is the major reason I&M’s generation in 2022 was more than 80% emission free.

The plant is also a major contributor to the southwest Michigan economy. Cook has 990 full-time I&M employees; employs approximately 100 to 200 contract workers on a long-term basis; and adds 600 to 1,000 temporary contract workers during refueling outages.

To make the best decision on how to move forward, I&M proposes to begin a comprehensive study to determine whether to apply to the Nuclear Regulatory Commission for a 20-year extension of the licenses. The study will require extensive inspections of the plant, environmental reviews, assessment of nearly 250,000 plant components and public participation.

In the Powering Our Future plan, I&M is seeking regulatory approval for the study, but most of its costs will be deferred and not collected from customers at this time.

New Payment Option

I&M is proposing PowerPay, a voluntary payment option that allows customers to pre-pay their electric bills, much like pre-paid cell phones. PowerPay offers customers a choice of when and how to pay their electric bills, providing the opportunity to make payments that are more in line with their cash flow.

PowerPay would help customers avoid larger-than-expected bills by receiving daily updates on usage and related costs. With no deposits, reconnection or late fees, PowerPay would help remove barriers for new customers needing to establish service and help reduce account balances.

The program is voluntary. Customers who prefer standard monthly billing do not have to change how they pay their bills.

Customer Information System

I&M serves about 133,000 Southwest Michigan homes and businesses over 1,370 square miles. As the needs of our customers change, modernization of the technology they interact with is essential.

The Powering Our Future plan includes a new customer information system. The new system will enable I&M to meet customers’ expectations by providing a modern platform to communicate through texts, e-mail, smart-phone apps and the company’s website.

This system will allow I&M to offer customers additional programs and position I&M to serve its customers as new technologies and customer expectations continue to evolve.

Customer Power Generation

Customer-owned generation is known as Distributed Generation because it is located where the electricity is used. I&M works with customers who own their own devices (primarily rooftop solar panels or wind turbines) to generate power. When customers generate more power than they use, the excess energy is delivered to I&M’s electric grid and customers are compensated for that power.

With Powering Our Future, I&M proposes an expanded Distributed Generation program that recognizes the growth in customer-owned generation resources and provides a reasonable and balanced approach to the compensation these customers receive for excess generation.

Service Charge

Powering Our Future proposes to adjust the customer service charge to more accurately reflect the true cost of service provided to each customer. The costs of poles, wires, transformers and other infrastructure do not change based on the amount of energy used, yet most of a customer’s bill is based on the volume of electricity consumed.

I&M is requesting a change in the residential customer service charge, from $7.25 to $11.50, to better reflect the fixed costs associated with connecting a customer to the system. The proposed increase is included in – and not in addition to – the proposed new rates.

What’s Next

The Michigan Public Service Commission will review I&M’s plans using a transparent process that offers the opportunity for public review and input. Customers can learn more about Powering Our Future and the regulatory rate review process at www.IndianaMichiganPower.com/PoweringOurFuture-MI
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Indiana Michigan Power (I&M) is headquartered in Fort Wayne, and its approximately 2,000 employees serve more than 600,000 customers. More than 80% of its energy delivered in 2022 was emission-free. I&M has at its availability various sources of generation including 2,278 MW of nuclear generation in Michigan, 450 MW of purchased wind generation from Indiana, more than 22 MW of hydro generation in both states and approximately 35 MW of large-scale solar generation in both states. The company’s generation portfolio also includes 1,497 MW of coal-fueled generation.

American Electric Power, based in Columbus, Ohio, is powering a cleaner, brighter energy future for its customers and communities. AEP’s approximately 17,000 employees operate and maintain the nation’s largest electricity transmission system and more than 225,000 miles of distribution lines to safely deliver reliable and affordable power to 5.6 million regulated customers in 11 states. AEP also is one of the nation’s largest electricity producers with approximately 30,000 megawatts of diverse generating capacity, including more than 7,000 megawatts of renewable energy. The company’s plans include growing its renewable generation portfolio to approximately 50% of total capacity by 2032. AEP is on track to reach an 80% reduction in carbon dioxide emissions from 2005 levels by 2030 and has committed to achieving net zero by 2045. AEP is recognized consistently for its focus on sustainability, community engagement, and diversity, equity and inclusion. AEP’s family of companies includes utilities AEP Ohio, AEP Texas, Appalachian Power (in Virginia and West Virginia), AEP Appalachian Power (in Tennessee), Indiana Michigan Power, Kentucky Power, Public Service Company of Oklahoma, and Southwestern Electric Power Company (in Arkansas, Louisiana, east Texas and the Texas Panhandle). AEP also owns AEP Energy, which provides innovative competitive energy solutions nationwide. For more information, visit aep.com

MEDIA CONTACTS:

Stephanny Smith
260-409-4292
slsmith2@aep.com

Tracy Warner
260-408-3420
tkwarner@aep.com