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FAIR VALUE MEASUREMENTS | 3 Months Ended
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Mar. 31, 2025
Fair Value Disclosures [Abstract] |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The disclosures in this note apply to all Registrants except AEPTCo unless indicated otherwise. Fair Value Hierarchy and Valuation Techniques The accounting guidance for “Fair Value Measurements and Disclosures” establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). Where observable inputs are available for substantially the full term of the asset or liability, the instrument is categorized in Level 2. When quoted market prices are not available, pricing may be completed using comparable securities, dealer values, operating data and general market conditions to determine fair value. Valuation models utilize various inputs such as commodity, interest rate and, to a lesser degree, volatility and credit that include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, market corroborated inputs (i.e. inputs derived principally from, or correlated to, observable market data) and other observable inputs for the asset or liability. For commercial activities, exchange-traded derivatives, namely futures contracts, are generally fair valued based on unadjusted quoted prices in active markets and are classified as Level 1. Level 2 inputs primarily consist of OTC broker quotes in moderately active or less active markets, as well as exchange-traded derivatives where there is insufficient market liquidity to warrant inclusion in Level 1. Management verifies price curves using these broker quotes and classifies these fair values within Level 2 when substantially all of the fair value can be corroborated. Management typically obtains multiple broker quotes, which are nonbinding in nature but are based on recent trades in the marketplace. When multiple broker quotes are obtained, the quoted bid and ask prices are averaged. In certain circumstances, a broker quote may be discarded if it is a clear outlier. Management uses a historical correlation analysis between the broker quoted location and the illiquid locations. If the points are highly correlated, these locations are included within Level 2 as well. Certain OTC and bilaterally executed derivative instruments are executed in less active markets with a lower availability of pricing information. Illiquid transactions, complex structured transactions, FTRs and counterparty credit risk may require nonmarket-based inputs. Some of these inputs may be internally developed or extrapolated and utilized to estimate fair value. When such inputs have a significant impact on the measurement of fair value, the instrument is categorized as Level 3. The main driver of contracts being classified as Level 3 is the inability to substantiate energy price curves in the market. A portion of the Level 3 instruments have been economically hedged which limits potential earnings volatility. AEP utilizes its trustee’s external pricing service to estimate the fair value of the underlying investments held in the nuclear trusts. AEP’s investment managers review and validate the prices utilized by the trustee to determine fair value. AEP’s management performs its own valuation testing to verify the fair values of the securities. AEP receives audit reports of the trustee’s operating controls and valuation processes. Assets in the nuclear trusts, cash and cash equivalents, other temporary investments and restricted cash for securitized funding are classified using the following methods. Equities are classified as Level 1 holdings if they are actively traded on exchanges. Items classified as Level 1 are investments in money market funds, fixed income and equity mutual funds and equity securities. They are valued based on observable inputs, primarily unadjusted quoted prices in active markets for identical assets. Items classified as Level 2 are primarily investments in individual fixed income securities. Fixed income securities generally do not trade on exchanges and do not have an official closing price but their valuation inputs are based on observable market data. Pricing vendors calculate bond valuations using financial models and matrices. The models use observable inputs including yields on benchmark securities, quotes by securities brokers, rating agency actions, discounts or premiums on securities compared to par prices, changes in yields for U.S. Treasury securities, corporate actions by bond issuers, prepayment schedules and histories, economic events and, for certain securities, adjustments to yields to reflect changes in the rate of inflation. Other securities with model-derived valuation inputs that are observable are also classified as Level 2 investments. Investments with unobservable valuation inputs are classified as Level 3 investments. Fair Value Measurements of Long-term Debt (Applies to all Registrants) The fair values of Long-term Debt are based on quoted market prices, without credit enhancements, for the same or similar issues and the current interest rates offered for instruments with similar maturities classified as Level 2 measurement inputs. These instruments are not marked-to-market. The estimates presented are not necessarily indicative of the amounts that could be realized in a current market exchange. The book values and fair values of Long-term Debt are summarized in the following table:
|  | March 31, 2025 |  | December 31, 2024
Company |  | Book Value |  | Fair Value |  | Book Value |  | Fair Value
|  | (in millions)
AEP |  | $ | 42,989.8 |  |  | $ | 39,687.2 |  |  | $ | 42,642.8 |  |  | $ | 38,964.7 |
AEP Texas |  | 6,830.7 |  |  | 6,256.7 |  |  | 6,441.6 |  |  | 5,831.4 |
AEPTCo |  | 5,719.0 |  |  | 4,850.2 |  |  | 5,768.1 |  |  | 4,853.1 |
APCo |  | 5,647.5 |  |  | 5,362.5 |  |  | 5,660.3 |  |  | 5,346.0 |
I&M |  | 3,471.6 |  |  | 3,154.9 |  |  | 3,494.3 |  |  | 3,153.8 |
OPCo |  | 3,716.4 |  |  | 3,227.8 |  |  | 3,715.7 |  |  | 3,203.4 |
PSO |  | 2,731.2 |  |  | 2,486.9 |  |  | 2,855.6 |  |  | 2,562.1 |
SWEPCo |  | 3,981.4 |  |  | 3,569.8 |  |  | 3,980.8 |  |  | 3,431.5 |
Fair Value Measurements of Other Temporary Investments and Restricted Cash (Applies to AEP) Other Temporary Investments include marketable securities that management intends to hold for less than one year and investments by AEP’s protected cell of EIS. The following is a summary of Other Temporary Investments and Restricted Cash:
|  | March 31, 2025
|  |  |  | Gross |  | Gross |  |
|  |  |  | Unrealized |  | Unrealized |  | Fair
Other Temporary Investments and Restricted Cash |  | Cost |  | Gains |  | Losses |  | Value
|  | (in millions)
Restricted Cash (a) |  | $ | 35.2 |  |  | $ | — |  |  | $ | — |  |  | $ | 35.2 |
Other Cash Deposits |  | 13.9 |  |  | — |  |  | — |  |  | 13.9 |
Fixed Income Securities – Mutual Funds (b) |  | 164.2 |  |  | — |  |  | (3.9) |  |  | 160.3 |
Equity Securities – Mutual Funds |  | 11.0 |  |  | 21.6 |  |  | — |  |  | 32.6 |
Total Other Temporary Investments and Restricted Cash |  | $ | 224.3 |  |  | $ | 21.6 |  |  | $ | (3.9) |  |  | $ | 242.0 |
|  | December 31, 2024
|  |  |  | Gross |  | Gross |  |
|  |  |  | Unrealized |  | Unrealized |  | Fair
Other Temporary Investments and Restricted Cash |  | Cost |  | Gains |  | Losses |  | Value
|  | (in millions)
Restricted Cash (a) |  | $ | 43.1 |  |  | $ | — |  |  | $ | — |  |  | $ | 43.1 |
Other Cash Deposits |  | 13.9 |  |  | — |  |  | — |  |  | 13.9 |
Fixed Income Securities – Mutual Funds (b) |  | 167.2 |  |  | — |  |  | (5.3) |  |  | 161.9 |
Equity Securities – Mutual Funds |  | 12.7 |  |  | 26.9 |  |  | — |  |  | 39.6 |
Total Other Temporary Investments and Restricted Cash |  | $ | 236.9 |  |  | $ | 26.9 |  |  | $ | (5.3) |  |  | $ | 258.5 |
(a)Primarily represents amounts held for the repayment of debt. (b)Primarily short and intermediate maturities which may be sold and do not contain maturity dates. The following table provides the activity for fixed income and equity securities within Other Temporary Investments:
| Three Months Ended March 31, |  |
| 2025 |  | 2024 |  |  |  |
| (in millions)
Proceeds from Investment Sales | $ | 10.0 |  |  | $ | 3.0 |  |  |  |  |
Purchases of Investments | 1.5 |  |  | 1.5 |  |  |  |  |
Gross Realized Gains on Investment Sales | 4.0 |  |  | 0.3 |  |  |  |  |
Gross Realized Losses on Investment Sales | 0.2 |  |  | 0.2 |  |  |  |  |
Fair Value Measurements of Trust Assets for Decommissioning and SNF Disposal (Applies to AEP and I&M) Nuclear decommissioning and SNF trust funds represent funds that regulatory commissions allow I&M to collect through rates to fund future decommissioning and SNF disposal liabilities. By rules or orders, the IURC, the MPSC and the FERC established investment limitations and general risk management guidelines. In general, limitations include: •Acceptable investments (rated investment grade or above when purchased). •Maximum percentage invested in a specific type of investment. •Prohibition of investment in obligations of AEP, I&M or their affiliates. •Withdrawals permitted only for payment of decommissioning costs and trust expenses. I&M maintains trust funds for each regulatory jurisdiction. Regulatory approval is required to withdraw decommissioning funds. These funds are managed by an external investment manager that must comply with the guidelines and rules of the applicable regulatory authorities. The trust assets are invested to optimize the net of tax earnings of the trust giving consideration to liquidity, risk, diversification and other prudent investment objectives. I&M records securities held in these trust funds in Spent Nuclear Fuel and Decommissioning Trusts on its balance sheets. I&M records these securities at fair value. I&M classifies debt securities in the trust funds as available-for-sale due to their long-term purpose. Other-than-temporary impairments for investments in debt securities are considered realized losses as a result of securities being managed by an external investment management firm. The external investment management firm makes specific investment decisions regarding the debt and equity investments held in these trusts and generally intends to sell debt securities in an unrealized loss position as part of a tax optimization strategy. Impairments reduce the cost basis of the securities which will affect any future unrealized gain or realized gain or loss due to the adjusted cost of investment. I&M records unrealized gains, unrealized losses and other-than-temporary impairments from securities in these trust funds as adjustments to the regulatory liability account for the nuclear decommissioning trust funds and to regulatory assets or liabilities for the SNF disposal trust funds in accordance with their treatment in rates. Consequently, changes in fair value of trust assets do not affect earnings or AOCI. The following is a summary of nuclear trust fund investments:
| March 31, 2025 |  | December 31, 2024
|  |  | Gross |  | Gross |  | Other-Than- |  |  |  | Gross |  | Gross |  | Other-Than-
| Fair |  | Unrealized |  | Unrealized |  | Temporary |  | Fair |  | Unrealized |  | Unrealized |  | Temporary
| Value |  | Gains |  | Losses |  | Impairments |  | Value |  | Gains |  | Losses |  | Impairments
| (in millions)
Cash and Cash Equivalents | $ | 24.6 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 23.3 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Fixed Income Securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
United States Government | 1,327.6 |  |  | 19.2 |  |  | (1.2) |  |  | (19.0) |  |  | 1,322.8 |  |  | 8.2 |  |  | (5.3) |  |  | (20.2) |
Corporate Debt | 240.5 |  |  | 1.6 |  |  | (8.6) |  |  | (6.1) |  |  | 211.3 |  |  | 0.7 |  |  | (9.8) |  |  | (5.8) |
State and Local Government | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Subtotal Fixed Income Securities | 1,568.1 |  |  | 20.8 |  |  | (9.8) |  |  | (25.1) |  |  | 1,534.1 |  |  | 8.9 |  |  | (15.1) |  |  | (26.0) |
Equity Securities - Domestic | 2,716.6 |  |  | 2,162.8 |  |  | (3.1) |  |  | — |  |  | 2,837.7 |  |  | 2,288.9 |  |  | (0.4) |  |  | — |
Spent Nuclear Fuel and Decommissioning Trusts | $ | 4,309.3 |  |  | $ | 2,183.6 |  |  | $ | (12.9) |  |  | $ | (25.1) |  |  | $ | 4,395.1 |  |  | $ | 2,297.8 |  |  | $ | (15.5) |  |  | $ | (26.0) |
The following table provides the securities activity within the decommissioning and SNF trusts:
|  | Three Months Ended March 31, |  |
|  | 2025 |  | 2024 |  |  |  |
|  | (in millions)
Proceeds from Investment Sales |  | $ | 576.5 |  |  | $ | 569.5 |  |  |  |  |
Purchases of Investments |  | 601.2 |  |  | 588.5 |  |  |  |  |
Gross Realized Gains on Investment Sales |  | 1.9 |  |  | 5.4 |  |  |  |  |
Gross Realized Losses on Investment Sales |  | 0.7 |  |  | 1.2 |  |  |  |  |
The base cost of fixed income securities was $1.6 billion and $1.5 billion as of March 31, 2025 and December 31, 2024, respectively. The base cost of equity securities was $557 million and $549 million as of March 31, 2025 and December 31, 2024, respectively. The fair value of fixed income securities held in the nuclear trust funds, summarized by contractual maturities, as of March 31, 2025 was as follows:
| Fair Value of Fixed
| Income Securities
| (in millions)
Within 1 year | $ | 344.0 |
After 1 year through 5 years | 601.9 |
After 5 years through 10 years | 268.9 |
After 10 years | 353.3 |
Total | $ | 1,568.1 |
Fair Value Measurements of Financial Assets and Liabilities The following tables set forth, by level within the fair value hierarchy, the Registrants’ financial assets and liabilities that were accounted for at fair value on a recurring basis. As required by the accounting guidance for “Fair Value Measurements and Disclosures,” financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Management’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. There have not been any significant changes in management’s valuation techniques. AEP Assets and Liabilities Measured at Fair Value on a Recurring Basis March 31, 2025
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Other Temporary Investments and Restricted Cash |  |  |  |  |  |  |  |  |  |
Restricted Cash |  | $ | 35.2 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 35.2 |
Other Cash Deposits (a) |  | — |  |  | — |  |  | — |  |  | 13.9 |  |  | 13.9 |
Fixed Income Securities – Mutual Funds |  | 160.3 |  |  | — |  |  | — |  |  | — |  |  | 160.3 |
Equity Securities – Mutual Funds (b) |  | 32.6 |  |  | — |  |  | — |  |  | — |  |  | 32.6 |
Total Other Temporary Investments and Restricted Cash |  | 228.1 |  |  | — |  |  | — |  |  | 13.9 |  |  | 242.0 |
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) (d) |  | 11.9 |  |  | 839.7 |  |  | 236.2 |  |  | (695.2) |  |  | 392.6 |
Cash Flow Hedges: |  |  |  |  |  |  |  |  |  |
Commodity Hedges (c) |  | — |  |  | 157.3 |  |  | 16.9 |  |  | (10.9) |  |  | 163.3 |
Total Risk Management Assets |  | 11.9 |  |  | 997.0 |  |  | 253.1 |  |  | (706.1) |  |  | 555.9 |
Spent Nuclear Fuel and Decommissioning Trusts |  |  |  |  |  |  |  |  |  |
Cash and Cash Equivalents (e) |  | 13.9 |  |  | — |  |  | — |  |  | 10.7 |  |  | 24.6 |
Fixed Income Securities: |  |  |  |  |  |  |  |  |  |
United States Government |  | — |  |  | 1,327.6 |  |  | — |  |  | — |  |  | 1,327.6 |
Corporate Debt |  | — |  |  | 240.5 |  |  | — |  |  | — |  |  | 240.5 |
State and Local Government |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Subtotal Fixed Income Securities |  | — |  |  | 1,568.1 |  |  | — |  |  | — |  |  | 1,568.1 |
Equity Securities – Domestic (b) |  | 2,716.6 |  |  | — |  |  | — |  |  | — |  |  | 2,716.6 |
Total Spent Nuclear Fuel and Decommissioning Trusts |  | 2,730.5 |  |  | 1,568.1 |  |  | — |  |  | 10.7 |  |  | 4,309.3 |
Total Assets |  | $ | 2,970.5 |  |  | $ | 2,565.1 |  |  | $ | 253.1 |  |  | $ | (681.5) |  |  | $ | 5,107.2 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) (d) |  | $ | 9.0 |  |  | $ | 714.7 |  |  | $ | 128.7 |  |  | $ | (596.5) |  |  | $ | 255.9 |
Cash Flow Hedges: |  |  |  |  |  |  |  |  |  |
Commodity Hedges (c) |  | — |  |  | 15.9 |  |  | 1.6 |  |  | (10.9) |  |  | 6.6 |
Fair Value Hedges |  | — |  |  | 68.4 |  |  | — |  |  | — |  |  | 68.4 |
Total Risk Management Liabilities |  | $ | 9.0 |  |  | $ | 799.0 |  |  | $ | 130.3 |  |  | $ | (607.4) |  |  | $ | 330.9 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis December 31, 2024
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Other Temporary Investments and Restricted Cash |  |  |  |  |  |  |  |  |  |
Restricted Cash |  | $ | 43.1 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 43.1 |
Other Cash Deposits (a) |  | — |  |  | — |  |  | — |  |  | 13.9 |  |  | 13.9 |
Fixed Income Securities – Mutual Funds |  | 161.9 |  |  | — |  |  | — |  |  | — |  |  | 161.9 |
Equity Securities – Mutual Funds (b) |  | 39.6 |  |  | — |  |  | — |  |  | — |  |  | 39.6 |
Total Other Temporary Investments and Restricted Cash |  | 244.6 |  |  | — |  |  | — |  |  | 13.9 |  |  | 258.5 |
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) (f) |  | 2.9 |  |  | 597.3 |  |  | 291.6 |  |  | (517.2) |  |  | 374.6 |
Cash Flow Hedges: |  |  |  |  |  |  |  |  |  |
Commodity Hedges (c) |  | — |  |  | 115.6 |  |  | 21.9 |  |  | (12.6) |  |  | 124.9 |
Total Risk Management Assets |  | 2.9 |  |  | 712.9 |  |  | 313.5 |  |  | (529.8) |  |  | 499.5 |
Spent Nuclear Fuel and Decommissioning Trusts |  |  |  |  |  |  |  |  |  |
Cash and Cash Equivalents (e) |  | 9.6 |  |  | — |  |  | — |  |  | 13.7 |  |  | 23.3 |
Fixed Income Securities: |  |  |  |  |  |  |  |  |  |
United States Government |  | — |  |  | 1,322.8 |  |  | — |  |  | — |  |  | 1,322.8 |
Corporate Debt |  | — |  |  | 211.3 |  |  | — |  |  | — |  |  | 211.3 |
State and Local Government |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Subtotal Fixed Income Securities |  | — |  |  | 1,534.1 |  |  | — |  |  | — |  |  | 1,534.1 |
Equity Securities – Domestic (b) |  | 2,837.7 |  |  | — |  |  | — |  |  | — |  |  | 2,837.7 |
Total Spent Nuclear Fuel and Decommissioning Trusts |  | 2,847.3 |  |  | 1,534.1 |  |  | — |  |  | 13.7 |  |  | 4,395.1 |
Total Assets |  | $ | 3,094.8 |  |  | $ | 2,247.0 |  |  | $ | 313.5 |  |  | $ | (502.2) |  |  | $ | 5,153.1 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) (f) |  | $ | 4.4 |  |  | $ | 534.1 |  |  | $ | 147.7 |  |  | $ | (433.6) |  |  | $ | 252.6 |
Cash Flow Hedges: |  |  |  |  |  |  |  |  |  |
Commodity Hedges (c) |  | — |  |  | 12.6 |  |  | 0.2 |  |  | (12.6) |  |  | 0.2 |
Fair Value Hedges |  | — |  |  | 71.6 |  |  | — |  |  | — |  |  | 71.6 |
Total Risk Management Liabilities |  | $ | 4.4 |  |  | $ | 618.3 |  |  | $ | 147.9 |  |  | $ | (446.2) |  |  | $ | 324.4 |
AEP Texas Assets and Liabilities Measured at Fair Value on a Recurring Basis March 31, 2025
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Restricted Cash for Securitized Funding |  | $ | 13.4 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 13.4 |
Liabilities: |  | (in millions)
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 0.2 |  |  | $ | — |  |  | $ | (0.2) |  |  | $ | — |
December 31, 2024
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Restricted Cash for Securitized Funding |  | $ | 23.5 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 23.5 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 0.3 |  |  | $ | — |  |  | $ | (0.3) |  |  | $ | — |
APCo Assets and Liabilities Measured at Fair Value on a Recurring Basis March 31, 2025
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Restricted Cash for Securitized Funding |  | $ | 10.6 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 10.6 |
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | — |  |  | 23.1 |  |  | 11.5 |  |  | (3.1) |  |  | 31.5 |
Total Assets |  | $ | 10.6 |  |  | $ | 23.1 |  |  | $ | 11.5 |  |  | $ | (3.1) |  |  | $ | 42.1 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 2.6 |  |  | $ | 3.5 |  |  | $ | (3.2) |  |  | $ | 2.9 |
December 31, 2024
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Restricted Cash for Securitized Funding |  | $ | 16.2 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 16.2 |
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | — |  |  | 6.5 |  |  | 35.2 |  |  | (4.6) |  |  | 37.1 |
Total Assets |  | $ | 16.2 |  |  | $ | 6.5 |  |  | $ | 35.2 |  |  | $ | (4.6) |  |  | $ | 53.3 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 6.9 |  |  | $ | — |  |  | $ | (4.7) |  |  | $ | 2.2 |
I&M Assets and Liabilities Measured at Fair Value on a Recurring Basis March 31, 2025
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 5.2 |  |  | $ | 4.1 |  |  | $ | (5.4) |  |  | $ | 3.9 |
Spent Nuclear Fuel and Decommissioning Trusts |  |  |  |  |  |  |  |  |  |
Cash and Cash Equivalents (e) |  | 13.9 |  |  | — |  |  | — |  |  | 10.7 |  |  | 24.6 |
Fixed Income Securities: |  |  |  |  |  |  |  |  |  |
United States Government |  | — |  |  | 1,327.6 |  |  | — |  |  | — |  |  | 1,327.6 |
Corporate Debt |  | — |  |  | 240.5 |  |  | — |  |  | — |  |  | 240.5 |
State and Local Government |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Subtotal Fixed Income Securities |  | — |  |  | 1,568.1 |  |  | — |  |  | — |  |  | 1,568.1 |
Equity Securities - Domestic (b) |  | 2,716.6 |  |  | — |  |  | — |  |  | — |  |  | 2,716.6 |
Total Spent Nuclear Fuel and Decommissioning Trusts |  | 2,730.5 |  |  | 1,568.1 |  |  | — |  |  | 10.7 |  |  | 4,309.3 |
Total Assets |  | $ | 2,730.5 |  |  | $ | 1,573.3 |  |  | $ | 4.1 |  |  | $ | 5.3 |  |  | $ | 4,313.2 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 26.4 |  |  | $ | 0.2 |  |  | $ | (23.4) |  |  | $ | 3.2 |
December 31, 2024
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 19.9 |  |  | $ | 6.9 |  |  | $ | (8.4) |  |  | $ | 18.4 |
Spent Nuclear Fuel and Decommissioning Trusts |  |  |  |  |  |  |  |  |  |
Cash and Cash Equivalents (e) |  | 9.6 |  |  | — |  |  | — |  |  | 13.7 |  |  | 23.3 |
Fixed Income Securities: |  |  |  |  |  |  |  |  |  |
United States Government |  | — |  |  | 1,322.8 |  |  | — |  |  | — |  |  | 1,322.8 |
Corporate Debt |  | — |  |  | 211.3 |  |  | — |  |  | — |  |  | 211.3 |
Subtotal Fixed Income Securities |  | — |  |  | 1,534.1 |  |  | — |  |  | — |  |  | 1,534.1 |
Equity Securities - Domestic (b) |  | 2,837.7 |  |  | — |  |  | — |  |  | — |  |  | 2,837.7 |
Total Spent Nuclear Fuel and Decommissioning Trusts |  | 2,847.3 |  |  | 1,534.1 |  |  | — |  |  | 13.7 |  |  | 4,395.1 |
Total Assets |  | $ | 2,847.3 |  |  | $ | 1,554.0 |  |  | $ | 6.9 |  |  | $ | 5.3 |  |  | $ | 4,413.5 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 9.2 |  |  | $ | 0.5 |  |  | $ | (9.0) |  |  | $ | 0.7 |
OPCo Assets and Liabilities Measured at Fair Value on a Recurring Basis March 31, 2025
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Liabilities: |  | (in millions)
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | — |  |  | $ | 51.2 |  |  | $ | — |  |  | $ | 51.2 |
December 31, 2024
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Liabilities: |  | (in millions)
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 0.2 |  |  | $ | 47.5 |  |  | $ | (0.2) |  |  | $ | 47.5 |
PSO Assets and Liabilities Measured at Fair Value on a Recurring Basis March 31, 2025
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 20.7 |  |  | $ | 15.6 |  |  | $ | (2.1) |  |  | $ | 34.2 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 3.0 |  |  | $ | 0.2 |  |  | $ | (2.1) |  |  | $ | 1.1 |
December 31, 2024
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 3.1 |  |  | $ | 20.8 |  |  | $ | (1.9) |  |  | $ | 22.0 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 7.0 |  |  | $ | 0.8 |  |  | $ | (2.0) |  |  | $ | 5.8 |
SWEPCo Assets and Liabilities Measured at Fair Value on a Recurring Basis March 31, 2025
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Restricted Cash for Securitized Funding |  | $ | 11.2 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 11.2 |
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | — |  |  | 5.4 |  |  | 13.4 |  |  | (0.9) |  |  | 17.9 |
Total Assets |  | $ | 11.2 |  |  | $ | 5.4 |  |  | $ | 13.4 |  |  | $ | (0.9) |  |  | $ | 29.1 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 1.1 |  |  | $ | 0.3 |  |  | $ | (1.0) |  |  | $ | 0.4 |
December 31, 2024
|  | Level 1 |  | Level 2 |  | Level 3 |  | Other |  | Total
Assets: |  | (in millions)
Restricted Cash for Securitized Funding |  | $ | 3.4 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 3.4 |
Risk Management Assets |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | — |  |  | 1.0 |  |  | 18.1 |  |  | (1.0) |  |  | 18.1 |
Total Assets |  | $ | 3.4 |  |  | $ | 1.0 |  |  | $ | 18.1 |  |  | $ | (1.0) |  |  | $ | 21.5 |
Liabilities: |  |  |  |  |  |  |  |  |  |
Risk Management Liabilities |  |  |  |  |  |  |  |  |  |
Risk Management Commodity Contracts (c) |  | $ | — |  |  | $ | 2.8 |  |  | $ | 0.6 |  |  | $ | (1.1) |  |  | $ | 2.3 |
(a)Amounts in “Other’’ column primarily represent cash deposits in bank accounts with financial institutions or third-parties. Level 1 and Level 2 amounts primarily represent investments in money market funds. (b)Amounts represent publicly traded equity securities and equity-based mutual funds. (c)Amounts in “Other’’ column primarily represent counterparty netting of risk management and hedging contracts and associated cash collateral under the accounting guidance for “Derivatives and Hedging.’’ (d)The March 31, 2025 maturities of the net fair value of risk management contracts prior to cash collateral, assets/(liabilities), were as follows: Level 1 matures $6 million in 2025 and $(3) million in periods 2026-2028; Level 2 matures $59 million in 2025, $63 million in periods 2026-2028 and $3 million in periods 2029-2030; Level 3 matures $66 million in 2025, $56 million in periods 2026-2028, $10 million in periods 2029-2030 and $(25) million in periods 2031-2034. Risk management commodity contracts are substantially comprised of power contracts. (e)Amounts in “Other’’ column primarily represent accrued interest receivables from financial institutions. Level 1 amounts primarily represent investments in money market funds. (f)The December 31, 2024 maturities of the net fair value of risk management contracts prior to cash collateral, assets/(liabilities), were as follows: Level 1 matures $(1) million in 2025; Level 2 matures $16 million in 2025, $43 million in periods 2026-2028, $4 million in periods 2029-2030; Level 3 matures $106 million in 2025, $45 million in periods 2026-2028, $9 million in periods 2029-2030 and $(16) million in periods 2031-2034. Risk management commodity contracts are substantially comprised of power contracts. The following tables set forth a reconciliation of changes in the fair value of net trading derivatives classified as Level 3 in the fair value hierarchy:
Three Months Ended March 31, 2025 |  | AEP |  | APCo |  | I&M |  | OPCo |  | PSO |  | SWEPCo
|  | (in millions)
Balance as of December 31, 2024 |  | $ | 165.6 |  |  | $ | 35.2 |  |  | $ | 6.4 |  |  | $ | (47.5) |  |  | $ | 20.0 |  |  | $ | 17.5 |
Realized Gain (Loss) Included in Net Income (or Changes in Net Assets) (a) (b) |  | 92.0 |  |  | 40.0 |  |  | 8.9 |  |  | (0.1) |  |  | 16.9 |  |  | 20.8 |
Unrealized Gain (Loss) Included in Net Income (or Changes in Net Assets) Relating to Assets Still Held at the Reporting Date (a) |  | 18.8 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Realized and Unrealized Gains (Losses) Included in Other Comprehensive Income (c) |  | 5.5 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Settlements |  | (167.8) |  |  | (66.5) |  |  | (12.4) |  |  | 2.1 |  |  | (28.1) |  |  | (31.3) |
Transfers into Level 3 (d) (e) |  | 0.7 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Transfers out of Level 3 (e) |  | 0.8 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Changes in Fair Value Allocated to Regulated Jurisdictions (f) |  | 7.2 |  |  | (0.7) |  |  | 1.0 |  |  | (5.7) |  |  | 6.6 |  |  | 6.1 |
Balance as of March 31, 2025 |  | $ | 122.8 |  |  | $ | 8.0 |  |  | $ | 3.9 |  |  | $ | (51.2) |  |  | $ | 15.4 |  |  | $ | 13.1 |
Three Months Ended March 31, 2024 |  | AEP |  | APCo |  | I&M |  | OPCo |  | PSO |  | SWEPCo
|  | (in millions)
Balance as of December 31, 2023 |  | $ | 139.4 |  |  | $ | 22.4 |  |  | $ | 2.8 |  |  | $ | (50.6) |  |  | $ | 18.6 |  |  | $ | 11.1 |
Realized Gain (Loss) Included in Net Income (or Changes in Net Assets) (a) (b) |  | 46.9 |  |  | 9.2 |  |  | 3.2 |  |  | (0.4) |  |  | 18.5 |  |  | 14.7 |
Unrealized Gain (Loss) Included in Net Income (or Changes in Net Assets) Relating to Assets Still Held at the Reporting Date (a) |  | 11.3 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Realized and Unrealized Gains (Losses) Included in Other Comprehensive Income (c) |  | 0.6 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Settlements |  | (96.6) |  |  | (26.8) |  |  | (4.8) |  |  | 2.6 |  |  | (31.3) |  |  | (23.6) |
Transfers into Level 3 (d) (e) |  | 4.6 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Transfers out of Level 3 (e) |  | 2.1 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 0.5 |
Changes in Fair Value Allocated to Regulated Jurisdictions (f) |  | 10.8 |  |  | (0.8) |  |  | (0.2) |  |  | 7.4 |  |  | 1.9 |  |  | 2.6 |
Balance as of March 31, 2024 |  | $ | 119.1 |  |  | $ | 4.0 |  |  | $ | 1.0 |  |  | $ | (41.0) |  |  | $ | 7.7 |  |  | $ | 5.3 |
(a)Included in revenues on the statements of income. (b)Represents the change in fair value between the beginning of the reporting period and the settlement of the risk management commodity contract. (c)Included in cash flow hedges on the statements of comprehensive income. (d)Represents existing assets or liabilities that were previously categorized as Level 2. (e)Transfers are recognized based on their value at the beginning of the reporting period that the transfer occurred. (f)Relates to the net gains (losses) of those contracts that are not reflected on the statements of income. These changes in fair value are recorded as regulatory liabilities for net gains and as regulatory assets for net losses or accounts payable. The following tables quantify the significant unobservable inputs used in developing the fair value of Level 3 positions: Significant Unobservable Inputs March 31, 2025
|  |  |  |  |  |  |  | Significant |  | Input/Range
|  | Type of |  | Fair Value | Valuation |  | Unobservable |  |  |  |  |  | Weighted
Company |  | Input |  | Assets |  | Liabilities |  | Technique |  | Input (a) |  | Low |  | High |  | Average (b)
|  |  |  | (in millions) |  |  |  |  |  |  |  |  |  |
AEP |  | Energy Contracts |  | $ | 203.3 |  |  | $ | 124.2 |  |  | Discounted Cash Flow |  | Forward Market Price |  | $ | (17.47) |  |  | $ | 165.62 |  |  | $ | 47.92 |
AEP |  | FTRs |  | 49.8 |  |  | 6.1 |  |  | Discounted Cash Flow |  | Forward Market Price |  | (33.92) |  |  | 14.27 |  |  | (0.58) |
APCo |  | FTRs |  | 11.5 |  |  | 3.5 |  |  | Discounted Cash Flow |  | Forward Market Price |  | (1.63) |  |  | 6.48 |  |  | 0.88 |
I&M |  | FTRs |  | 4.1 |  |  | 0.2 |  |  | Discounted Cash Flow |  | Forward Market Price |  | (2.80) |  |  | 7.28 |  |  | 2.05 |
OPCo |  | Energy Contracts |  | — |  |  | 51.2 |  |  | Discounted Cash Flow |  | Forward Market Price |  | 14.76 |  |  | 74.75 |  |  | 39.26 |
PSO |  | FTRs |  | 15.6 |  |  | 0.2 |  |  | Discounted Cash Flow |  | Forward Market Price |  | (33.92) |  |  | 8.98 |  |  | (6.60) |
SWEPCo |  | FTRs |  | 13.4 |  |  | 0.3 |  |  | Discounted Cash Flow |  | Forward Market Price |  | (33.92) |  |  | 8.98 |  |  | (6.60) |
December 31, 2024
|  |  |  |  |  |  |  | Significant |  | Input/Range
|  | Type of |  | Fair Value | Valuation |  | Unobservable |  |  |  |  |  | Weighted
Company |  | Input |  | Assets |  | Liabilities |  | Technique |  | Input (a) |  | Low |  | High |  | Average (b)
|  |  |  | (in millions) |  |  |  |  |  |  |  |  |  |
AEP |  | Energy Contracts |  | $ | 221.2 |  |  | $ | 144.6 |  |  | Discounted Cash Flow |  | Forward Market Price |  | $ | 2.75 |  |  | $ | 149.30 |  |  | $ | 49.34 |
AEP |  | FTRs |  | 92.3 |  |  | 3.3 |  |  | Discounted Cash Flow |  | Forward Market Price |  | (29.48) |  |  | 19.70 |  |  | 0.24 |
APCo |  | FTRs |  | 35.2 |  |  | — |  |  | Discounted Cash Flow |  | Forward Market Price |  | (0.25) |  |  | 9.32 |  |  | 1.56 |
I&M |  | FTRs |  | 6.9 |  |  | 0.5 |  |  | Discounted Cash Flow |  | Forward Market Price |  | (4.07) |  |  | 9.32 |  |  | 1.34 |
OPCo |  | Energy Contracts |  | — |  |  | 47.5 |  |  | Discounted Cash Flow |  | Forward Market Price |  | 14.53 |  |  | 72.40 |  |  | 42.44 |
PSO |  | FTRs |  | 20.8 |  |  | 0.8 |  |  | Discounted Cash Flow |  | Forward Market Price |  | (29.48) |  |  | 10.54 |  |  | (3.88) |
SWEPCo |  | FTRs |  | 18.1 |  |  | 0.6 |  |  | Discounted Cash Flow |  | Forward Market Price |  | (29.48) |  |  | 10.54 |  |  | (3.88) |
(a)Represents market prices in dollars per MWh. (b)The weighted average is the product of the forward market price of the underlying commodity and volume weighted by term. The following table provides the measurement uncertainty of fair value measurements to increases (decreases) in significant unobservable inputs related to Energy Contracts and FTRs for the Registrants as of March 31, 2025 and December 31, 2024:
Significant Unobservable Input |  | Position |  | Change in Input |  | Impact on Fair Value Measurement
Forward Market Price |  | Buy |  | Increase (Decrease) |  | Higher (Lower)
Forward Market Price |  | Sell |  | Increase (Decrease) |  | Lower (Higher)

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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