AEP Releases Sustainable Finance Framework

Rhea-AI Summary

American Electric Power (AEP) has launched a Sustainable Finance Framework to issue green, social, and sustainability bonds and loans. This initiative links AEP's finance strategy with its commitments to clean energy and social impact. Proceeds will support projects like renewable energy development and enhancing energy efficiency. The framework aligns with eight United Nations Sustainable Development Goals, showcasing AEP's focus on creating positive environmental and social changes. The company aims for a significant increase in renewable energy capacity by 2030.

Positive

• Launch of Sustainable Finance Framework to support green and social projects.
• Proceeds will be allocated to renewable energy, energy efficiency, and infrastructure projects.
• AEP aims to grow renewable generation portfolio to 50% of total capacity by 2030.
• Commitment to 80% reduction in carbon emissions from 2000 levels by 2030.

Negative

• None.

COLUMBUS, Ohio, Aug. 9, 2021 /PRNewswire/ -- American Electric Power (Nasdaq: AEP) has developed a Sustainable Finance Framework, which will allow the company and its subsidiaries to issue green, social and sustainability bonds, loans or other financial instruments and allocate the funds to investments that enable positive social and environmental change.

The framework strengthens the link between AEP's finance strategy and its clean energy commitments and social values. Net proceeds from the instruments will be used by AEP or its subsidiaries to finance or refinance, in whole or in part, new or existing projects or assets that support renewable energy, energy efficiency, clean transportation, access to essential services and socioeconomic advancement and empowerment. The framework aligns with eight of the United Nations Sustainable Development Goals: quality education; gender equality; affordable and clean energy; decent work and economic growth; industry, innovation and infrastructure; reduced inequalities; sustainable cities and communities; and climate action. AEP appointed Sustainalytics to provide a second-party opinion on the framework, and Credit Agricole CIB advised AEP on the development of the framework.

"AEP's vision for a brighter energy future focuses on reducing our environmental footprint, while empowering vibrant communities," said Nicholas K. Akins, AEP's chairman, president and chief executive officer. "This framework will help support ongoing initiatives as we make strategic investments to advance our clean energy plans and deliver tangible value to our customers, communities and investors."

            Examples of projects eligible for investment through the financial instruments include:

• Acquiring, constructing and developing wind and solar energy projects; optimizing transmission and distribution infrastructure to support the interconnection of renewable resources
• Researching and developing technologies to reduce emissions, improve grid resiliency and increase the efficient use of energy
• Deploying advanced metering infrastructure (AMI) and consumer energy efficiency programs
• Implementing beneficial electrification and electric vehicle (EV) incentives and infrastructure programs; converting AEP's fleet to EVs
• Leveraging AEP's infrastructure to expand broadband internet service to rural and underserved areas
• Empowering equity for minorities through the procurement of products and services from small and minority-owned businesses, training and mentoring for those businesses and education assistance and professional development for minorities

Learn more about AEP's sustainability strategy.

American Electric Power, based in Columbus, Ohio, is powering a cleaner, brighter energy future for its customers and communities. AEP's approximately 16,800 employees operate and maintain the nation's largest electricity transmission system and more than 223,000 miles of distribution lines to safely deliver reliable and affordable power to 5.5 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 5,600 megawatts of renewable energy. The company's plans include growing its renewable generation portfolio to approximately 50% of total capacity by 2030. AEP is on track to reach an 80% reduction in carbon dioxide emissions from 2000 levels by 2030 and has committed to achieving net zero by 2050. 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.

 

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SOURCE American Electric Power

FAQ

What is the Sustainable Finance Framework by AEP?

AEP's Sustainable Finance Framework allows the issuance of green and social bonds to finance renewable energy and other sustainability projects.

How much renewable energy does AEP plan to have by 2030?

AEP aims for its renewable generation portfolio to reach approximately 50% of its total capacity by 2030.

What are the environmental goals of AEP?

AEP is committed to an 80% reduction in carbon dioxide emissions from 2000 levels by 2030 and achieving net zero emissions by 2050.

Which projects are eligible for financing under AEP's new framework?

Eligible projects include renewable energy, energy efficiency improvements, electric vehicle infrastructure, and broadband expansion in underserved areas.