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Financing Activities | 12 Months Ended
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Dec. 31, 2023
Financing Activities | Corporate Borrowing Program (Applies to Registrant Subsidiaries) AEP subsidiaries use a corporate borrowing program to meet the short-term borrowing needs of AEP’s subsidiaries. The corporate borrowing program includes a Utility Money Pool, which funds AEP’s utility subsidiaries; a Nonutility Money Pool, which funds certain AEP nonutility subsidiaries; and direct borrowing from AEP. The AEP Utility Money Pool operates in accordance with the terms and conditions of its agreement filed with the FERC. The amounts of outstanding loans to (borrowings from) the Utility Money Pool as of December 31, 2023 and 2022 are included in Advances to Affiliates and Advances from Affiliates, respectively, on the Registrant Subsidiaries’ balance sheets. The Utility Money Pool participants’ money pool activity and corresponding authorized borrowing limits are described in the following tables: Year Ended December 31, 2023:
|  | Maximum |  |  |  | Average |  |  |  | Net Loans to |  |  |
|  | Borrowings |  | Maximum |  | Borrowings |  | Average |  | (Borrowings from) |  | Authorized |
|  | from the |  | Loans to the |  | from the |  | Loans to the |  | the Utility Money |  | Short-term |
|  | Utility |  | Utility |  | Utility |  | Utility |  | Pool as of |  | Borrowing |
Company |  | Money Pool |  | Money Pool |  | Money Pool |  | Money Pool |  | December 31, 2023 |  | Limit |
|  | (in millions) |
AEP Texas |  | $ | 477.5 |  |  | $ | 42.0 |  |  | $ | 216.8 |  |  | $ | 12.9 |  |  | $ | (103.7) |  |  | $ | 600.0 |  |
AEPTCo |  | 471.3 |  |  | 309.4 |  |  | 135.6 |  |  | 70.5 |  |  | (62.8) |  |  | 820.0 |  | (a)
APCo |  | 388.6 |  |  | 19.8 |  |  | 283.5 |  |  | 19.0 |  |  | (320.7) |  |  | 750.0 |  |
I&M |  | 475.3 |  |  | 112.2 |  |  | 84.0 |  |  | 44.2 |  |  | (63.3) |  |  | 500.0 |  |
OPCo |  | 485.7 |  |  | 64.7 |  |  | 183.0 |  |  | 40.2 |  |  | (110.5) |  |  | 500.0 |  |
PSO |  | 375.0 |  |  | 121.5 |  |  | 92.5 |  |  | 49.6 |  |  | (54.4) |  |  | 750.0 |  |
SWEPCo |  | 401.6 |  |  | 25.8 |  |  | 150.7 |  |  | 16.5 |  |  | (88.7) |  |  | 750.0 |  |
Year Ended December 31, 2022:
|  | Maximum |  |  |  | Average |  |  |  | Net Loans to |  |  |
|  | Borrowings |  | Maximum |  | Borrowings |  | Average |  | (Borrowings from) |  | Authorized |
|  | from the |  | Loans to the |  | from the |  | Loans to the |  | the Utility Money |  | Short-term |
|  | Utility |  | Utility |  | Utility |  | Utility |  | Pool as of |  | Borrowing |
Company |  | Money Pool |  | Money Pool |  | Money Pool |  | Money Pool |  | December 31, 2022 |  | Limit |
|  | (in millions) |
AEP Texas |  | $ | 348.8 |  |  | $ | 652.3 |  |  | $ | 173.3 |  |  | $ | 247.8 |  |  | $ | (96.5) |  |  | $ | 500.0 |  |
AEPTCo |  | 480.2 |  |  | 137.0 |  |  | 189.4 |  |  | 28.9 |  |  | (195.5) |  |  | 820.0 |  | (a)
APCo |  | 438.4 |  |  | 214.2 |  |  | 181.7 |  |  | 45.4 |  |  | (162.4) |  |  | 500.0 |  |
I&M |  | 318.6 |  |  | 23.0 |  |  | 105.2 |  |  | 22.3 |  |  | (226.9) |  |  | 500.0 |  |
OPCo |  | 262.5 |  |  | 246.1 |  |  | 101.3 |  |  | 86.9 |  |  | (172.9) |  |  | 500.0 |  |
PSO |  | 364.2 |  |  | 432.5 |  |  | 224.5 |  |  | 402.8 |  |  | (364.2) |  |  | 400.0 |  |
SWEPCo |  | 358.4 |  |  | 156.6 |  |  | 219.3 |  |  | 109.7 |  |  | (310.7) |  |  | 400.0 |  |
(a) Amount represents the combined authorized short-term borrowing limit the State Transcos have from FERC or state regulatory commissions. The activity in the above tables does not include short-term lending activity of certain AEP nonutility subsidiaries. AEP Texas’ wholly-owned subsidiary, AEP Texas North Generation Company, LLC and SWEPCo’s wholly-owned subsidiary, Mutual Energy SWEPCo, LLC participate in the Nonutility Money Pool. The amounts of outstanding loans to the Nonutility Money Pool as of December 31, 2023 and 2022 are included in Advances to Affiliates on each subsidiaries’ balance sheets. The Nonutility Money Pool participants’ money pool activity is described in the following tables: Year Ended December 31, 2023:
|  | Maximum Loans |  | Average Loans |  | Loans to the Nonutility
|  | to the Nonutility |  | to the Nonutility |  | Money Pool as of
Company |  | Money Pool |  | Money Pool |  | December 31, 2023
|  | (in millions)
AEP Texas |  | $ | 7.1 |  |  | $ | 6.9 |  |  | $ | 7.1 |
SWEPCo |  | 2.8 |  |  | 2.4 |  |  | 2.2 |
Year Ended December 31, 2022:
|  | Maximum Loans |  | Average Loans |  | Loans to the Nonutility
|  | to the Nonutility |  | to the Nonutility |  | Money Pool as of
Company |  | Money Pool |  | Money Pool |  | December 31, 2022
|  | (in millions)
AEP Texas |  | $ | 7.0 |  |  | $ | 6.8 |  |  | $ | 6.9 |
SWEPCo |  | 2.1 |  |  | 2.1 |  |  | 2.1 |
AEP has a direct financing relationship with AEPTCo to meet its short-term borrowing needs. The amounts of outstanding loans to and borrowings from AEP as of December 31, 2023 and 2022 are included in Advances to Affiliates and Advances from Affiliates, respectively, on AEPTCo’s balance sheets. AEPTCo’s direct financing activities with AEP and corresponding authorized borrowing limits are described in the following tables: Year Ended December 31, 2023:
Maximum |  | Maximum |  | Average |  | Average |  | Borrowings from |  | Loans to |  | Authorized |
Borrowings |  | Loans |  | Borrowings |  | Loans |  | AEP as of |  | AEP as of |  | Short-term |
from AEP |  | to AEP |  | from AEP |  | to AEP |  | December 31, 2023 |  | December 31, 2023 |  | Borrowing Limit |
(in millions) |
$ | 44.4 |  |  | $ | 158.1 |  |  | $ | 3.9 |  |  | $ | 64.2 |  |  | $ | 44.4 |  |  | $ | — |  |  | $ | 50.0 |  | (a)
Year Ended December 31, 2022:
Maximum |  | Maximum |  | Average |  | Average |  | Borrowings from |  | Loans to |  | Authorized |
Borrowings |  | Loans |  | Borrowings |  | Loans |  | AEP as of |  | AEP as of |  | Short-term |
from AEP |  | to AEP |  | from AEP |  | to AEP |  | December 31, 2022 |  | December 31, 2022 |  | Borrowing Limit |
(in millions) |
$ | 52.4 |  |  | $ | 141.8 |  |  | $ | 6.7 |  |  | $ | 57.5 |  |  | $ | 29.4 |  |  | $ | — |  |  | $ | 50.0 |  | (a)
(a) Amount represents the authorized short-term borrowing limit from FERC or state regulatory agencies not otherwise included in the utility money pool above. The maximum and minimum interest rates for funds either borrowed from or loaned to the Utility Money Pool are summarized in the following table:
| Years Ended December 31,
| 2023 |  | 2022 |  | 2021
Maximum Interest Rate | 5.81 | % |  | 5.28 | % |  | 0.48 | %
Minimum Interest Rate | 4.66 | % |  | 0.10 | % |  | 0.02 | %
The average interest rates for funds borrowed from and loaned to the Utility Money Pool are summarized in the following table:
|  | Average Interest Rate for Funds Borrowed from the Utility Money Pool for the Years Ended December 31, |  | Average Interest Rate for Funds Loaned to the Utility Money Pool for the Years Ended December 31,
Company |  | 2023 |  | 2022 |  | 2021 |  | 2023 |  | 2022 |  | 2021
AEP Texas |  | 5.46 | % |  | 1.08 | % |  | 0.33 | % |  | 5.71 | % |  | 1.99 | % |  | 0.26 | %
AEPTCo |  | 5.41 | % |  | 1.81 | % |  | 0.32 | % |  | 5.56 | % |  | 2.47 | % |  | 0.10 | %
APCo |  | 5.54 | % |  | 2.34 | % |  | 0.41 | % |  | 5.54 | % |  | 2.39 | % |  | 0.25 | %
I&M |  | 5.14 | % |  | 2.57 | % |  | 0.33 | % |  | 5.57 | % |  | 2.20 | % |  | 0.23 | %
OPCo |  | 5.43 | % |  | 3.51 | % |  | 0.27 | % |  | 5.60 | % |  | 1.22 | % |  | 0.14 | %
PSO |  | 5.51 | % |  | 2.65 | % |  | 0.34 | % |  | 5.35 | % |  | 0.75 | % |  | 0.07 | %
SWEPCo |  | 5.34 | % |  | 2.80 | % |  | 0.26 | % |  | 5.72 | % |  | 0.55 | % |  | 0.18 | %
Maximum, minimum and average interest rates for funds loaned to the Nonutility Money Pool are summarized in the following table:
|  |  |  | Maximum Interest Rate |  | Minimum Interest Rate |  | Average Interest Rate
Year Ended |  |  |  | for Funds Loaned to |  | for Funds Loaned to |  | for Funds Loaned to
December 31, |  | Company |  | the Nonutility Money Pool |  | the Nonutility Money Pool |  | the Nonutility Money Pool
2023 |  | AEP Texas |  | 5.81 | % |  | 4.66 | % |  | 5.54 | %
2023 |  | SWEPCo |  | 5.81 | % |  | 4.66 | % |  | 5.56 | %
2022 |  | AEP Texas |  | 5.28 | % |  | 0.46 | % |  | 2.23 | %
2022 |  | SWEPCo |  | 5.28 | % |  | 0.46 | % |  | 2.23 | %
2021 |  | AEP Texas |  | 0.58 | % |  | 0.21 | % |  | 0.37 | %
2021 |  | SWEPCo |  | 0.58 | % |  | 0.21 | % |  | 0.37 | %
AEPTCo’s maximum, minimum and average interest rates for funds either borrowed from or loaned to AEP are summarized in the following table:
|  | Maximum |  | Minimum |  | Maximum |  | Minimum |  | Average |  | Average
|  | Interest Rate |  | Interest Rate |  | Interest Rate |  | Interest Rate |  | Interest Rate |  | Interest Rate
|  | for Funds |  | for Funds |  | for Funds |  | for Funds |  | for Funds |  | for Funds
Year Ended |  | Borrowed from |  | Borrowed from |  | Loaned to |  | Loaned to |  | Borrowed from |  | Loaned to
December 31, |  | AEP |  | AEP |  | AEP |  | AEP |  | AEP |  | AEP
2023 |  | 5.81 | % |  | 4.53 | % |  | 5.81 | % |  | 4.53 | % |  | 5.56 | % |  | 5.51 | %
2022 |  | 5.28 | % |  | 0.46 | % |  | 5.28 | % |  | 0.46 | % |  | 2.08 | % |  | 2.07 | %
2021 |  | 0.86 | % |  | 0.25 | % |  | 0.86 | % |  | 0.25 | % |  | 0.38 | % |  | 0.35 | %
Interest expense related to short-term borrowing activities with the Utility Money Pool, Nonutility Money Pool and direct borrowing financing relationship are included in Interest Expense on each of the Registrant Subsidiaries’ statements of income. The Registrant Subsidiaries incurred interest expense for all short-term borrowing activities as follows:
|  | Years Ended December 31,
Company |  | 2023 |  | 2022 |  | 2021
|  | (in millions)
AEP Texas |  | $ | 10.8 |  |  | $ | 0.9 |  |  | $ | 0.3 |
AEPTCo |  | 7.6 |  |  | 3.5 |  |  | 0.6 |
APCo |  | 16.8 |  |  | 5.6 |  |  | 0.1 |
I&M |  | 3.2 |  |  | 2.9 |  |  | 0.2 |
OPCo |  | 9.7 |  |  | 2.3 |  |  | 0.1 |
PSO |  | 2.3 |  |  | 5.5 |  |  | 0.3 |
SWEPCo |  | 7.9 |  |  | 4.9 |  |  | 0.3 |
Interest income related to short-term lending activities with the Utility Money Pool, Nonutility Money Pool and direct borrowing financing relationship are included in Interest Income, unless shown as Other Income due to materiality, on each of the Registrant Subsidiaries’ statements of income. The Registrant Subsidiaries earned interest income for all short-term lending activities as follows:
|  | Years Ended December 31,
Company |  | 2023 |  | 2022 |  | 2021
|  | (in millions)
AEP Texas |  | $ | 0.1 |  |  | $ | 2.6 |  |  | $ | 0.1 |
AEPTCo |  | 7.0 |  |  | 1.6 |  |  | 0.4 |
APCo |  | 1.1 |  |  | 2.8 |  |  | 0.3 |
I&M |  | 2.4 |  |  | 0.5 |  |  | 0.2 |
OPCo |  | 0.1 |  |  | 0.4 |  |  | 0.1 |
PSO |  | 1.5 |  |  | 0.3 |  |  | — |
SWEPCo |  | 0.2 |  |  | 0.2 |  |  | 0.1 |
Credit Facilities See “Letters of Credit” section of Note 6 for additional information. Securitized Accounts Receivables – AEP Credit (Applies to AEP) AEP Credit has a receivables securitization agreement with bank conduits. Under the securitization agreement, AEP Credit receives financing from the bank conduits for the interest in the receivables AEP Credit acquires from affiliated utility subsidiaries. These securitized transactions allow AEP Credit to repay its outstanding debt obligations, continue to purchase the operating companies’ receivables and accelerate AEP Credit’s cash collections. AEP Credit’s receivables securitization agreement provides a commitment of $900 million from bank conduits to purchase receivables. The agreement was amended in August 2023 to increase the commitment from $750 million and expires in September 2025. As of December 31, 2023, the affiliated utility subsidiaries were in compliance with all requirements under the agreement. Accounts receivable information for AEP Credit was as follows:
| Years Ended December 31,
| 2023 |  | 2022 |  | 2021
| (dollars in millions)
Effective Interest Rates on Securitization of Accounts Receivable | 5.33 | % |  | 1.84 | % |  | 0.19 | %
Net Uncollectible Accounts Receivable Written Off | $ | 30.7 |  |  | $ | 29.5 |  |  | $ | 26.5 |
| December 31,
| 2023 |  | 2022
| (in millions)
Accounts Receivable Retained Interest and Pledged as Collateral Less Uncollectible Accounts | $ | 1,207.4 |  |  | $ | 1,167.7 |
Short-term – Securitized Debt of Receivables | 888.0 |  |  | 750.0 |
Delinquent Securitized Accounts Receivable | 52.2 |  |  | 44.2 |
Bad Debt Reserves Related to Securitization | 42.0 |  |  | 39.7 |
Unbilled Receivables Related to Securitization | 409.8 |  |  | 360.9 |
AEP Credit’s delinquent customer accounts receivable represent accounts greater than 30 days past due. Securitized Accounts Receivables – AEP Credit (Applies to Registrant Subsidiaries, except AEP Texas and AEPTCo) Under this sale of receivables arrangement, the Registrant Subsidiaries sell, without recourse, certain of their customer accounts receivable and accrued unbilled revenue balances to AEP Credit and are charged a fee based on AEP Credit’s financing costs, administrative costs and uncollectible accounts experience for each Registrant Subsidiary’s receivables. APCo does not have regulatory authority to sell its West Virginia accounts receivable. KPCo ceased selling accounts receivable to AEP Credit in the first quarter of 2022, based on the expected sale to Liberty. As a result, in the first quarter of 2022, KPCo recorded an allowance for uncollectible accounts on its balance sheet for those receivables no longer sold to AEP Credit. In the third quarter of 2023, KPCo resumed selling accounts receivable to AEP Credit, due to the termination of the sale to Liberty, and the balance in KPCo’s allowance for uncollectible accounts was reversed. The costs of customer accounts receivable sold are reported in Other Operation expense on the Registrant Subsidiaries’ statements of income. The Registrant Subsidiaries manage and service their customer accounts receivable, which are sold to AEP Credit. AEP Credit securitizes the eligible receivables for the operating companies and retains the remainder. The amount of accounts receivable and accrued unbilled revenues under the sale of receivables agreement were:
|  | December 31,
Company |  | 2023 |  | 2022
|  | (in millions)
APCo |  | $ | 184.6 |  |  | $ | 194.4 |
I&M |  | 156.4 |  |  | 166.9 |
OPCo |  | 541.7 |  |  | 478.6 |
PSO |  | 134.6 |  |  | 155.5 |
SWEPCo |  | 168.3 |  |  | 194.0 |
The fees paid to AEP Credit for customer accounts receivable sold were:
|  | Years Ended December 31,
Company |  | 2023 |  | 2022 |  | 2021 (a)
|  | (in millions)
APCo |  | $ | 16.9 |  |  | $ | 9.4 |  |  | $ | 4.9 |
I&M |  | 16.3 |  |  | 9.7 |  |  | 7.0 |
OPCo |  | 29.5 |  |  | 29.8 |  |  | 8.3 |
PSO |  | 15.3 |  |  | 7.4 |  |  | 3.4 |
SWEPCo |  | 18.5 |  |  | 9.4 |  |  | 5.4 |
(a)In 2021, due to the successful collection of accounts receivable balances during the COVID-19 pandemic, the allowance for doubtful accounts was reduced, resulting in the issuance of credits to offset the higher fees previously paid and to lower subsequent fees paid. The proceeds on the sale of receivables to AEP Credit were:
|  | Years Ended December 31,
Company |  | 2023 |  | 2022 |  | 2021
|  | (in millions)
APCo |  | $ | 1,819.8 |  |  | $ | 1,552.9 |  |  | $ | 1,324.1 |
I&M |  | 2,054.8 |  |  | 2,045.6 |  |  | 1,927.0 |
OPCo |  | 3,339.3 |  |  | 3,101.3 |  |  | 2,458.5 |
PSO |  | 1,944.5 |  |  | 1,809.5 |  |  | 1,406.4 |
SWEPCo |  | 1,866.4 |  |  | 1,858.4 |  |  | 1,636.1 |

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(c)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 470 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//470/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (i) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1E -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I + Details
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