Economic & Business Development
Developing and investing in the local communities where we operate and provide service has become increasingly important to us and our communities. Our Economic and Business Development (E&BD) team works with local communities and state officials to attract and retain businesses and jobs.
Toyota Case Study
In 2014, the E&BD team helped companies create nearly 21,000 jobs and bring more than $4.25 billion of investment to our communities, including announcements from such companies as General Electric in South Bend, Ind., Computer Sciences Corporation in Bossier City, Louisiana, Kraft Foods in Coshocton, Ohio, International Paper in Valliant, Okla., and TPO America in Gregory, Texas. In 2014, AEP was named one of the top 10 utilities for economic development by Site Selection magazine for the third year in a row.
The E&BD team provides comprehensive assistance, such as property searches and screening; custom research on demographics, work force, incentives and geographic information system (GIS) mapping; electric service plan and rate design; site visits; design, build and maintenance services for electrical facilities; local economic development training; and introductions to state, regional and local government officials and business leaders.
AEP continues to focus on building a portfolio of well-prepared sites in our service territory to meet the needs of expanding companies. AEP has nine sites pre-qualified for data center development and 18 industrial sites working toward certification in 2015. To obtain industrial certification, the sites must meet a stringent set of criteria, including due diligence and completion of environmental assessments. Certified sites are an important economic development strategy. They help businesses minimize risk factors in making location decisions, lower development costs and allow the site to become operational more quickly. AEP’s first certified industrial site in Shreveport, Louisiana, received certification in January 2015.
In addition to shale oil and gas and data centers, AEP specializes in identifying strategic locations for the automotive manufacturing industry. AEP’s 11-state service territory offers several advantages for automotive manufacturers and suppliers, including: a critical mass of existing industry; access to national and global markets via a strong transportation network; a skilled workforce and competitive wages; low taxes; and availability of large parcels of land with substantial energy infrastructure. One example of this is the Toyota Motor Manufacturing of North America, one of Appalachian Power’s largest automotive manufacturing customers. AEP helped Toyota site their engine plant in Buffalo, W.Va., in 1996 and has been a partner with the company through eight facility expansion projects in that time. Learn more.
Both AEP Ohio and Kentucky Power Company offer economic advancement grant programs to support projects that promote the retention and attraction of manufacturing jobs and investment. Kentucky Power has committed to provide $1 million to stimulate economic development over the next five years. In 2014, Kentucky Power awarded $200,000 to three local entities. AEP Ohio has offered grants to local economic development organizations since 2005. As of December 2014, more than 200 grants totaling over $750,000 have been awarded to support local communities throughout the AEP Ohio service territory.
AEP Ohio launched its Community Economic Development Academy (CEDA) in southeastern Ohio. The academy, developed in conjunction with the Appalachian Partnership for Economic Growth, helps local economic development professionals and key community leaders understand the types of information required by businesses selecting sites for new facilities, including data basics such as rail access to facility ceiling height to minimum number of loading docks. The academy is taught by professionals engaged in the business of selecting communities for new investment and provides a unique opportunity for AEP’s partner communities to identify their competitive gaps and opportunities. Economic development professionals representing 17 counties participated.
Kentucky Power Company is an active participant in the Shaping Our Appalachian Region (SOAR) an initiative created by Governor Steve Beshear and Congressman Hal Rogers. SOAR’s goal is to improve the economy and quality of life in the region. In addition, Kentucky Power Company has played a significant role in the creation of the new regional economic development organization, One East Kentucky. One East Kentucky is a partnership of nine counties of eastern Kentucky that are working together to increase economic development activity within the region. Finally, Kentucky Power Company is in the process of completing its third phase of an economic development site consultant project assisting the region with preparing Marion’s Branch (Pikeville) and Coalfields (Hazard) industrial parks for job creation and additional investments.
AEP’s Southwestern Electric Power Company (SWEPCo) teamed up with regional and local banks to develop a $100 million senior unsecured three-year term loan to provide financing for SWEPCo’s increasing investments in its local infrastructure to improve service to its customers. This type of financing strategy provides SWEPCo with competitive financing while promoting strong economies in the communities we serve. Historically, the opportunity to finance assets was limited to large national financial institutions with global portfolios and traditional capital markets. Raising capital within our service territory allows us to build liquidity and diversify our lender base. It also allows us to do business with local banks, promoting stronger local ties and strengthening the economies in the communities we serve. AEP Texas, Public Service Company of Oklahoma (PSO) and Indiana Michigan Power are also engaged in this type of financing strategy.