AEP’s renewable buildout has flexibility to handle uncertainty in the solar market
AEP expects to spend about $8.2 billion from 2022 through 2026 as part of its plan to shift its generating fleet to about half renewable energy by the end of the decade, according to the Columbus, Ohio-based company’s earnings presentation.
To help get there, AEP utilities have pending solicitations for 9.9 GW of renewable capacity, including about 2.2 GW of solar combined with storage.
AEP has flexibility in putting its clean energy plan in place, according to Akins. If less solar is added, the company will add more wind or some other resource, he said.
Also, with energy prices rising, the plan will buffer AEP customers from fuel price fluctuations, Akins told analysts. “The renewables are a key part of being able to really mitigate costs to consumers,” Akins said.
AEP is preparing to launch a sale of all or some of its 1,600 MW of unregulated renewable energy assets, most likely in August or September, Akins said, noting the company is seeing “robust” initial interest in the wind and solar farms.
The company has already reached agreements to sell five wind projects that are under development in the Southwest Power Pool’s footprint and a solar project being developed in Ohio, Akins said during the earnings conference call.
The company is also on track to sell Kentucky Power and AEP Kentucky TransCo to Liberty Utilities, an Algonquin Power & Utilities subsidiary, in the second quarter, according to Akins.
The Kentucky Public Service Commission is set to issue a decision on the $2.85 billion deal on May 4, followed by decisions by the Kentucky PSC and the West Virginia PSC on the coal-fired Mitchell power plant, Akins said.