By CASEY JUNKINS
MOUNDSVILLE, W.Va. - As American Electric Power continues shifting much of its generating capacity away from coal - and works to demolish the Marshall County Kammer Plant - the Columbus, Ohio-based utility posted a $766 million loss from July 1 through Sept. 30.
The loss compares to earnings of $518 million during the same period in 2015, putting AEP's year-to-date earnings nearly $1.3 billion behind this point in 2015. The company provides electricity service to most customers in Marshall, Ohio, Belmont, Monroe, Harrison and Jefferson counties, while FirstEnergy Corp. subsidiary Mon Power serves most in Brooke, Hancock, Wetzel and Tyler counties.
"Our strategic focus on our regulated operations continues to support strong operating earnings performance. All of our regulated segments grew during the quarter, but we experienced declines in our competitive operations year-over-year," AEP Chairman, President and CEO Nicholas Akins said.
The company blames some of its losses on competitive generation, which officials said includes the Cardinal Plant in Brilliant. During the third quarter, AEP sold four competitive power plants that generate a total of 5,200 megawatts of electricity to private business ventures Blackstone and ArcLight Capital Partners for $2.17 billion. Included in the sale is the 840-megawatt Waterford Energy Center in Waterford, Ohio.
"AEP's long-term strategy has been to become a fully regulated, premium energy company focused on investment in infrastructure and the energy innovations that our customers want and need. This transaction advances that strategy and reduces some of the business risks associated with operating competitive generating assets," Akins said regarding the sale of these plants. "We will continue the strategic review of those plants and work on restructuring in Ohio to properly value future generation investments for the benefit of our customers."
Last year, AEP shut down 5,535 megawatts of coal-fired electricity across Appalachia, including the 630-megawatt Kammer Plant, portions of which are now being demolished.
"Residential and commercial sales in the third quarter were in line with our expectations, but the weak global economy, low energy prices and a strong dollar are still generating economic headwinds," Akins added regarding the company's third-quarter performance.
"The growth in residential and commercial sales that we've seen this year is being offset by declining industrial load in many states that we serve."