For decades, with operations from West Virginia, Ohio, to Arkansas, AEP has been one of America's largest electric utilities that depended overwhelmingly on coal-fired generation to meet the needs of its millions of customers. But times are changing at AEP, with the company announcing at its annual meeting this week that it will use more gas and renewable energy and less coal.
Nicholas Akins, AEP's President and CEO, told shareholders that AEP will reduce to 50% by 2020 the amount of its electricity coming from coal-fired power plants. In 2011, AEP produced 67% of its power from coal-fired power plants and will retire 5,100 megawatts of coal plants in the coming years.
Akins wrote in a statement: "Several factors are driving us in this direction, including new environmental regulations; the economics of coal versus natural gas; the operating cost, age and efficiency of some coal units; increased competition; and grid reliability."
In 2020, when AEP is getting 50% of its generation from coal, what portion of America's electricity will be coming from coal? In 2012, EIA states 38% of our power will come from coal so AEP may be America's largest generator of coal-fired generation in 2020, even after its on-going shift to gas and renewable energy for more of its total power.