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AEP to Sell Kentucky Operations to Liberty

by on November 1, 2021

AEP has completed its strategic review process announced in April and has made the decision to sell the Kentucky operations, which include Kentucky Power and AEP Kentucky Transco, to Liberty. Liberty provides electric, natural gas, water and wastewater service to more than 1 million customer connections, mainly in 13 U.S. states and Canada.

The sale directly impacts 360 employees., including 315 employees in Kentucky Power and another 45 employees from the Service Corporation who will transfer to the new owner when the sale is completed. AEP is committed to working with these individuals to provide information about their options and answer questions as we address the personal impacts of this transition. 

Mitchell Plant will continue to be operated by AEP, pending regulatory approval of new plant ownership and operating agreements that will be filed this year. The 200 plant employees and support personnel will be transferred to Wheeling Power. Liberty will own and obtain power from Kentucky Power’s 50% portion of the plant through 2028.

“Our employees have done an incredible job supporting our customers and communities, and I’m confident that they will contribute to the future success of Liberty,” said Nick Akins, chairman, president and chief executive officer. “We will continue to work hard every day to ensure our Kentucky Power customers have safe, reliable service, while working closely with employees and community leaders to ensure a smooth transition. We also will be working with the Liberty team to obtain the regulatory approvals necessary to complete the sale,” Akins said.

The sale must be approved by regulators including the Kentucky Public Service Commission and the Federal Energy Regulatory Commission. AEP expects the transaction to close in the second quarter of 2022.

AEP and Kentucky Power leadership are sharing information with these employees in a series of meetings.

“The employees of Kentucky Power have provided tremendous value to AEP and our customers. I know I speak for leaders across AEP when I say that we greatly appreciate all they have done to provide reliable and efficient electric service in the most professional manner. Liberty is acquiring an outstanding team,” said Brett Mattison, president & COO, Kentucky Power.

Mattison noted that AEP is working with Liberty and with employees to assure as smooth a transition as possible. “I recognize that this has been and will continue to be an uncertain time for our employees for a bit longer. It’s very important for everyone to focus on the task at hand and work safely at all times,” he said.

AEP plans to use the funds from this transaction to invest in regulated projects such as transmission and renewable energy. This strengthens the company’s financing plan by reducing the amount of money AEP has to borrow to fund these projects.

Liberty is based in Oakville, a town in Ontario, Canada, with U.S. operations in 13 other states including Arizona, Arkansas, California, Georgia, Illinois, Iowa, Kansas, Massachusetts, Missouri, New Hampshire, New York, Oklahoma and Texas. They have significant experience running regulated energy utilities, including generation, distribution and transmission assets. Their parent company is Algonquin Power & Utilities, which also owns a renewable energy business.

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