COLUMBUS, Ohio, Sept. 17, 2004 - American Electric Power (NYSE: AEP) subsidiary Texas Central Co. (TCC), formerly known as Central Power and Light, has signed an agreement to sell a portion of its 7.8 percent share of Oklaunion Power Station to one of the plant´s co-owners, Oklahoma Municipal Power Authority (OMPA), pursuant to OMPA´s exercise of its right of first refusal for TCC´s share.

On June 4, TCC signed a similar purchase and sale agreement with another co-owner, City of Brownsville, Texas (Brownsville Public Utilities Board), pursuant to its exercise of its right of first refusal. OMPA and Brownsville will split TCC´s 53.9-megawatt share of Oklaunion using a formula based on OMPA´s and Brownsville´s current ownership interest in the plant. OMPA will pay approximately $22.9 million before adjustments for 28.9 megawatts, or approximately 53.6 percent of TCC´s share. Brownsville will pay approximately $19.8 million before adjustments for 25 megawatts, or approximately 46.4 percent of TCC´s share.

AEP announced plans in December 2002 to sell all of the generation assets owned by TCC to determine their market value for calculating stranded costs (the amount that the book value exceeds the market value of the assets) under Texas restructuring legislation. A competitive bidding process for the assets began in June 2003. As of Dec. 31, 2001, the book value of TCC’s share of Oklaunion was approximately $20.3 million.

AEP announced a purchase and sale agreement with Golden Spread Electric Cooperative for the TCC share of Oklaunion on Jan. 30, 2004. That purchase and sale agreement was subject to the rights of first refusal of the other Oklaunion owners under the Oklaunion Participation Agreement. The terms and conditions of the purchase and sale agreement entered into with OMPA and Brownsville are consistent with those in the Golden Spread purchase and sale agreement. Litigation initiated by Golden Spread concerning the rights of first refusal process must be resolved for the transaction to close.

Oklaunion Power Station is a 692-megawatt coal-fired generating station located near the Oklahoma border in Vernon, Texas. Three AEP subsidiaries and two other companies jointly own the plant. In addition to the share of the plant owned by TCC, AEP Texas North Co. (formerly West Texas Utilities) owns 54.7 percent of the facility and AEP’s Public Service Company of Oklahoma owns 15.6 percent. OMPA currently owns 11.7 percent of the facility and Brownsville currently owns 10.2 percent of the facility. When their purchase of the TCC share of Oklaunion is complete, OMPA will own 15.9 percent and Brownsville will own 13.8 percent of Oklaunion. AEP’s Public Service of Oklahoma unit operates the facility.

American Electric Power owns more than 36,000 megawatts of generating capacity in the United States and is the nation´s largest electricity generator. AEP is also one of the largest electric utilities in the United States, with more than 5 million customers linked to AEP’s 11-state electricity transmission and distribution grid. The company is based in Columbus, Ohio.
 

These reports made by AEP and its registrant subsidiaries contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Although AEP and its registrant subsidiaries believe that their expectations are based on reasonable assumptions, any such statements may be influenced by factors that could cause actual outcomes and results to be materially different from those projected. Among the factors that could cause actual results to differ materially from those in the forward-looking statements are: electric load and customer growth; weather conditions; available sources and costs of fuels; availability of generating capacity and the performance of AEP’s generating plants; the ability to recover regulatory assets and stranded costs in connection with deregulation; new legislation and government regulation including requirements for reduced emissions of sulfur, nitrogen, carbon and other substances; resolution of pending and future rate cases, negotiations and other regulatory decisions (including rate or other recovery for environmental compliance); oversight and/or investigation of the energy sector or its participants; resolution of litigation (including pending Clean Air Act enforcement actions and disputes arising from the bankruptcy of Enron Corp.); AEP’s ability to reduce its operation and maintenance costs; the success of disposing of investments that no longer match AEP’s corporate profile; AEP’s ability to sell assets at attractive prices and on other attractive terms; international and country-specific developments affecting foreign investments including the disposition of any current foreign investments; the economic climate and growth in AEP’s service territory and changes in market demand and demographic patterns; inflationary trends; AEP’s ability to develop and execute on a point of view regarding prices of electricity, natural gas, and other energy-related commodities; changes in the creditworthiness and number of participants in the energy trading market; changes in the financial markets, particularly those affecting the availability of capital and AEP’s ability to refinance existing debt at attractive rates; actions of rating agencies, including changes in the ratings of debt and preferred stock; volatility and changes in markets for electricity, natural gas, and other energy-related commodities; changes in utility regulation, including the establishment of a regional transmission structure; accounting pronouncements periodically issued by accounting standard-setting bodies; the performance of AEP’s pension plan; prices for power that AEP generates and sells at wholesale; and changes in technology and other risks and unforeseen events, including wars, the effects of terrorism (including increased security costs), embargoes and other catastrophic events.