XML 91 R22.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Related Party Transactions | 12 Months Ended
--- | ---
Dec. 31, 2023
Related Party Transactions | RELATED PARTY TRANSACTIONS The disclosures in this note apply to all Registrant Subsidiaries unless indicated otherwise. For other related party transactions, also see “Income Taxes and Investment and Production Tax Credits” section of Note 1 in addition to “Corporate Borrowing Program” and “Securitized Accounts Receivables – AEP Credit” sections of Note 14. Intercompany Billings The Registrant Subsidiaries and other AEP subsidiaries perform certain utility services for each other when necessary or practical. The costs of these services are billed on a direct-charge basis, whenever possible, or on reasonable basis of proration for services that benefit multiple companies. The billings for services are made at cost and include no compensation for the use of equity capital. Power Coordination Agreement (Applies to all Registrant Subsidiaries except AEP Texas and AEPTCo) Effective January 1, 2014, the FERC approved the PCA. Under the PCA, APCo, I&M, KPCo and WPCo are individually responsible for planning their respective capacity obligations. The PCA allows, but does not obligate, APCo, I&M, KPCo and WPCo to participate collectively under a common fixed resource requirement capacity plan in PJM and to participate in specified collective Off-system Sales and purchase activities. AEPSC conducts power, capacity, coal, natural gas, interest rate and, to a lesser extent, heating oil, gasoline and other risk management activities on behalf of APCo, I&M, KPCo, PSO, SWEPCo and WPCo. Certain power and natural gas risk management activities for APCo, I&M, KPCo and WPCo are allocated based on the four member companies’ respective equity positions, while power and natural gas risk management activities for PSO and SWEPCo are allocated based on the Operating Agreement. AEPSC conducts only gasoline, diesel fuel, energy procurement and risk management activities on OPCo’s behalf. Joint License Agreement (Applies to all Registrant Subsidiaries except AEP Texas and SWEPCo) AEPTCo entered into a 50-year joint license agreement with APCo, I&M, KPCo, OPCo and PSO, respectively, allowing either party to occupy the granting party’s facilities or real property. In addition, AEPTCo entered into a 5-year joint license agreement with APCo and WPCo. After the expiration of these agreements, the term shall automatically renew for successive one-year terms unless either party provides notice. The joint license billing provides compensation to the granting party for the cost of carrying assets, including depreciation expense, property taxes, interest expense, return on equity and income taxes. AEPTCo recorded the costs related to these agreements in Other Operation expense on the statements of income. APCo, I&M, KPCo, OPCo, PSO and WPCo recorded income related to these agreements in Sales to AEP Affiliates on the statements of income. The impact of the joint license agreement for the years ended December 31, 2023, 2022 and 2021 was not material. Unit Power Agreements (Applies to I&M) A UPA between AEGCo and I&M (the I&M Power Agreement) provides for the sale by AEGCo to I&M of all the power (and the energy associated therewith) available to AEGCo at the Rockport Plant unless it is sold to another utility. I&M is obligated, whether or not power is available from AEGCo, to pay as a demand charge for the right to receive such power (and as an energy charge for any associated energy taken by I&M) net of amounts received by AEGCo from any other sources, sufficient to enable AEGCo to pay all of its operating and other expenses, including a rate of return on the common equity of AEGCo as approved by the FERC. The UPA will continue in effect until the debt obligations of AEGCo secured by the Rockport Plant have been satisfied and discharged (currently expected to be December 2028). I&M’s direct purchases from AEGCo were $181 million, $242 million and $218 million for the years ended December 31, 2023, 2022 and 2021, respectively. These direct purchases are presented as Purchased Electricity from AEP Affiliates on I&M’s statements of income. Ohio Auctions (Applies to OPCo) In connection with OPCo’s June 2012 - May 2015 ESP, the PUCO ordered OPCo to conduct energy and capacity auctions for its entire SSO load for delivery beginning in June 2015. AEP Energy and AEPEP participate in the auction process and have been awarded tranches of OPCo’s SSO load. OPCo’s auction purchases were $87 million, $10 million and $52 million for the years ended December 31, 2023, 2022 and 2021, respectively. These direct purchases are presented as Purchased Electricity from AEP Affiliates on OPCo’s statements of income. Sales and Purchases of Property Certain AEP subsidiaries had affiliated sales and purchases of electric property individually amounting to $100 thousand or more, sales and purchases of meters and transformers, and sales and purchases of transmission property. There were no gains or losses recorded on the transactions and the net book value of all sales and purchases for the years ended December 31, 2023, 2022 and 2021 were not material. These sales and purchases are recorded in Property, Plant and Equipment on the balance sheets. Charitable Contributions to AEP Foundation The American Electric Power Foundation is funded by American Electric Power and its utility operating units. The Foundation provides a permanent, ongoing resource for charitable initiatives and multi-year commitments in the communities served by AEP and initiatives outside of AEP’s 11-state service area. Charitable contributions to the AEP Foundation were not made in 2023 or 2021. Charitable contributions were recorded in Other Operation expenses on the statements of income as follows for the year ended December 31, 2022:
|  | AEP |  | AEP Texas |  | AEPTCo |  | APCo |  | I&M |  | OPCo |  | PSO |  | SWEPCo
|  | (in millions)
Contributions to AEP Foundation |  | $ | 75.0 |  |  | $ | 9.9 |  |  | $ | 11.1 |  |  | $ | 12.5 |  |  | $ | 11.0 |  |  | $ | 8.1 |  |  | $ | 5.8 |  |  | $ | 8.8 |
I&M Barging, Urea Transloading and Other Services (Applies to APCo and I&M) I&M provides barging, urea transloading and other transportation services to affiliates. Urea is a chemical used to control NO x emissions at certain generation plants in the AEP System. I&M recorded revenues from barging, transloading and other services in Other Revenues – Affiliated on the statements of income. The affiliated companies recorded these costs paid to I&M as fuel expenses or other operation expenses. The amounts of affiliated expenses were:
|  | Years Ended December 31,
Company |  | 2023 |  | 2022 |  | 2021
|  | (in millions)
AEGCo |  | $ | 9.3 |  |  | $ | 11.3 |  |  | $ | 7.6 |
APCo |  | 39.2 |  |  | 36.1 |  |  | 40.1 |
KPCo |  | — |  |  | 2.0 |  |  | 3.1 |
WPCo |  | 10.6 |  |  | 4.7 |  |  | 3.2 |
AEP Wind Holdings LLC PPAs (Applies to I&M, OPCo and SWEPCo) Prior to acquisition, Fowler Ridge 2 had PPAs with I&M and OPCo and Flat Ridge 2 had a PPA with SWEPCo for a portion of their energy production. The following table shows the amounts of purchased electricity by I&M, PSO and SWEPCo:
|  | Years Ended December 31,
Company |  | 2023 |  | 2022 |  | 2021
|  | (in millions)
I&M |  | $ | 8.0 |  |  | $ | 11.8 |  |  | $ | 9.9 |
OPCo |  | 16.1 |  |  | 23.6 |  |  | 19.6 |
SWEPCo |  | — |  |  | 13.7 |  |  | 14.5 |
See Note 7 - Acquisitions, Dispositions and Impairments for additional information related to the disposal of the 50% interests in Fowler Ridge 2 which was included in the August 2023 sale of the Competitive Contracted Renewables Portfolio and Flat Ridge 2 which was sold in November 2022. Transmission Service Charges The AEP East Companies are parties to the TA, which defines how transmission costs through the PJM OATT are allocated among the AEP East Companies on a 12-month average coincident peak basis. Additional costs for transmission services provided by AEPTCo and other transmission affiliates are billed to AEP East Companies through the PJM OATT. PSO, SWEPCo and AEPSC are parties to the TCA in connection with the operation of the transmission assets of PSO and SWEPCo. Under the TCA, AEPSC is responsible for monitoring the reliability of their transmission systems and administering the OATT. Additional costs for transmission services provided by AEPTCo and other transmission affiliates are billed to PSO and SWEPCo through the SPP OATT. Pursuant to an order from the PUCT, ETT bills AEP Texas for its ERCOT wholesale transmission services. The charges discussed above are recorded in Other Operation expenses on the statements of income. AEPTCo recorded affiliated transmission revenues in Sales to AEP Affiliates on the statements of income. Refer to the Affiliated Revenues section below for amounts related to these transactions. The following table shows the net transmission service charges recorded by the Registrant Subsidiaries:
|  | Years Ended December 31,
Company |  | 2023 |  | 2022 |  | 2021
|  | (in millions)
AEP Texas |  | $ | 28.7 |  |  | $ | 28.5 |  |  | $ | 28.0 |
APCo |  | 365.1 |  |  | 345.1 |  |  | 302.0 |
I&M |  | 226.2 |  |  | 220.8 |  |  | 186.7 |
OPCo |  | 665.3 |  |  | 608.2 |  |  | 508.9 |
PSO |  | 100.1 |  |  | 110.8 |  |  | 94.7 |
SWEPCo |  | 49.2 |  |  | 62.1 |  |  | 56.2 |
Affiliated Revenues The tables below represent revenues from affiliates, net of respective provisions for refund, by type of revenue for the Registrant Subsidiaries. Related party revenues are shown in Sales to AEP Affiliates, Provision for Refund - Affiliated and Other Revenues - Affiliated, respectively, on the Registrant Subsidiaries’ statements of income.
Related Party Revenues |  | AEP Texas |  | AEPTCo |  | APCo |  | I&M |  | OPCo |  | PSO |  | SWEPCo
|  | (in millions)
Year Ended December 31, 2023 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Direct Sales to East Affiliates |  | $ | — |  |  | $ | — |  |  | $ | 158.7 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Transmission Revenues |  | — |  |  | 1,304.0 |  |  | 70.9 |  |  | (11.1) |  |  | 3.2 |  |  | — |  |  | 45.3 |
Barging, Urea Transloading and Other Transportation Services |  | — |  |  | — |  |  | — |  |  | 59.0 |  |  | — |  |  | — |  |  | — |
Other Revenues |  | 4.9 |  |  | 13.8 |  |  | 9.7 |  |  | 9.9 |  |  | 27.9 |  |  | 1.2 |  |  | 1.5 |
Total Affiliated Revenues |  | $ | 4.9 |  |  | $ | 1,317.8 |  |  | $ | 239.3 |  |  | $ | 57.8 |  |  | $ | 31.1 |  |  | $ | 1.2 |  |  | $ | 46.8 |
Related Party Revenues |  | AEP Texas |  | AEPTCo |  | APCo |  | I&M |  | OPCo |  | PSO |  | SWEPCo
|  | (in millions)
Year Ended December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Direct Sales to East Affiliates |  | $ | — |  |  | $ | — |  |  | $ | 169.7 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Direct Sales to West Affiliates |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1.3 |
Transmission Revenues |  | — |  |  | 1,276.4 |  |  | 77.5 |  |  | 7.7 |  |  | (3.6) |  |  | — |  |  | 51.5 |
Barging, Urea Transloading and Other Transportation Services |  | — |  |  | — |  |  | — |  |  | 54.1 |  |  | — |  |  | — |  |  | — |
Other Revenues |  | 3.5 |  |  | 7.4 |  |  | 8.9 |  |  | 7.8 |  |  | 22.4 |  |  | 2.9 |  |  | 1.1 |
Total Affiliated Revenues |  | $ | 3.5 |  |  | $ | 1,283.8 |  |  | $ | 256.1 |  |  | $ | 69.6 |  |  | $ | 18.8 |  |  | $ | 2.9 |  |  | $ | 53.9 |
Related Party Revenues |  | AEP Texas |  | AEPTCo |  | APCo |  | I&M |  | OPCo |  | PSO |  | SWEPCo
|  | (in millions)
Year Ended December 31, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Direct Sales to East Affiliates |  | $ | — |  |  | $ | — |  |  | $ | 128.6 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Transmission Revenues |  | — |  |  | 1,136.1 |  |  | 60.3 |  |  | (2.5) |  |  | (1.1) |  |  | — |  |  | 39.6 |
Barging, Urea Transloading and Other Transportation Services |  | — |  |  | — |  |  | — |  |  | 54.0 |  |  | — |  |  | — |  |  | — |
Other Revenues |  | 3.9 |  |  | 17.8 |  |  | 9.0 |  |  | 6.3 |  |  | 25.9 |  |  | 4.2 |  |  | 1.4 |
Total Affiliated Revenues |  | $ | 3.9 |  |  | $ | 1,153.9 |  |  | $ | 197.9 |  |  | $ | 57.8 |  |  | $ | 24.8 |  |  | $ | 4.2 |  |  | $ | 41.0 |

X
- Definition The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-5 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-6 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481062/946-235-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481062/946-235-50-2 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147483326/850-10-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 220 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.6-07(2)(g)(3)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 220 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.6-07(2)(c)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 220 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.6-07(2)(e)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//850/tableOfContent Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Publisher FASB -URI https://asc.fasb.org//1943274/2147483326/850-10-50-6 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147483326/850-10-50-1 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 850 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147483326/850-10-50-1 + Details
Name: | us-gaap_RelatedPartyTransactionsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration