American Electric Power on Tuesday raised its five-year capital investment plan to $78 billion, an 8% increase from a plan released three months earlier, as surging data center growth spurs the US electric utility to build out its system.
US electricity demand is hitting record highs as Big Tech companies build power-hungry data centers to support artificial intelligence, prompting utilities to ramp up investments in generation and transmission infrastructure.
AEP said it signed 7 gigawatts of new large energy project agreements during the first quarter, primarily in Ohio and Texas. Nearly 90% of AEP's 63 gigawatts of expected incremental contracted load by 2030 is from data centers, including hyperscalers, the company said on a post-earnings call. Sixty-three gigawatts, for reference, is well over what is needed to power the entire U.S. state of California.
AEP said most of that new demand, some 41 gigawatts, is in Texas. The timing of infrastructure buildout in the state would depend on the availability of power generation, which is supplied by others, needed to support that demand.
AEP said it is in discussions with Google for a multi-billion dollar data center in West Virginia. The company is also expected to provide transmission services to a massive Japan-backed natural-gas fired data center campus in Piketon, Ohio, although it's not clear whether that project has a customer and if it will be built.
The Columbus, Ohio-based utility increased its five-year capital plan to $78 billion from $72 billion, driven by newly approved transmission investments in PJM and SPP and new natural gas-fired generation in Indiana.
Increasing utility spending on power infrastructure to serve data centers is also raising concerns about ballooning power bills for homes and businesses.
AEP said it has line of sight to over $10 billion in additional investment potential beyond the new plan, while signed large-load contracts are expected to provide up to $16 billion in cost offsets for existing customers.
"AEP is executing on our strategic plan at an exceptionally high level during a time of unprecedented opportunity for our industry while keeping an intense focus on affordability," CEO Bill Fehrman said.
AEP posted operating earnings of $1.64 per share for the three months ended March 31, compared with analysts' average estimate of $1.57 per share, according to LSEG data.
Revenue rose to $6.02 billion from $5.46 billion a year earlier, beating estimates of $5.68 billion.
The company reaffirmed its 2026 operating earnings forecast of $6.15 to $6.45 per share.
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AEP said it signed 7 gigawatts of new large energy project agreements during the first quarter, primarily in Ohio and Texas. Nearly 90% of AEP's 63 gigawatts of expected incremental contracted load by 2030 is from data centers, including hyperscalers, the company said on a post-earnings call. Sixty-three gigawatts, for reference, is well over what is needed to power the entire U.S. state of California.
AEP said most of that new demand, some 41 gigawatts, is in Texas. The timing of infrastructure buildout in the state would depend on the availability of power generation, which is supplied by others, needed to support that demand.
AEP said it is in discussions with Google for a multi-billion dollar data center in West Virginia. The company is also expected to provide transmission services to a massive Japan-backed natural-gas fired data center campus in Piketon, Ohio, although it's not clear whether that project has a customer and if it will be built.
The Columbus, Ohio-based utility increased its five-year capital plan to $78 billion from $72 billion, driven by newly approved transmission investments in PJM and SPP and new natural gas-fired generation in Indiana.
Increasing utility spending on power infrastructure to serve data centers is also raising concerns about ballooning power bills for homes and businesses.
AEP said it has line of sight to over $10 billion in additional investment potential beyond the new plan, while signed large-load contracts are expected to provide up to $16 billion in cost offsets for existing customers.
"AEP is executing on our strategic plan at an exceptionally high level during a time of unprecedented opportunity for our industry while keeping an intense focus on affordability," CEO Bill Fehrman said.
AEP posted operating earnings of $1.64 per share for the three months ended March 31, compared with analysts' average estimate of $1.57 per share, according to LSEG data.
Revenue rose to $6.02 billion from $5.46 billion a year earlier, beating estimates of $5.68 billion.
The company reaffirmed its 2026 operating earnings forecast of $6.15 to $6.45 per share.
