American Electric Power (AEP) risk factors, 2025 10-K

American Electric Power's 2025 10-K lists 17 risk factors in 2 groups. No earlier 10-K is on file to compare against, so the most company-specific risks are read out below.

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Risk factors listed
172 groups
Section length
11k wordsItem 1A

What dominates the section

  • Transmission investment earnings depend heavily on FERC and state policy, while regulation can delay projects or limit cost recovery.
  • Nuclear operations center on I&M’s 2,296-MW Cook Plant and NRC safety requirements, including potential shutdowns.
  • AEP faces substantial infrastructure, environmental, supply-chain, workforce, and capital-support demands across its regulated utility businesses.

The risks most specific to American Electric Power

  • AEP’s transmission investment strategy and execution are dependent on federal and state regulatory policy. (Applies to all Registrants)

    Changes in federal and state regulatory policy could undermine AEP’s transmission investment strategy and earnings.

  • End-use consumers and entities supplying electricity to end-use consumers may also attempt to influence government and/or regulators to change the rate setting methodologies that apply to AEP, particularly if rates for delivered electricity increase substantially

    Higher electricity rates may prompt customers to seek rate-setting changes, while siting, financing, permitting, and construction issues could delay facilities.

  • AEP may not recover costs incurred to begin construction on projects that are canceled. (Applies to all Registrants)

    Canceled projects may leave AEP unable to recover early construction costs; inaccurate forecasts, delays, supplier failures, and rising costs threaten new builds.

  • AEP is exposed to nuclear generation risk. (Applies to AEP and I&M)

    I&M’s two-unit, 2,296-MW Cook nuclear plant exposes AEP to nuclear operating and financial risks.

  • There can be no assurance that I&M’s preparations or risk mitigation measures will be adequate if these risks are triggered

    NRC enforcement for nuclear noncompliance could impose fines or shut down a Cook Plant unit until compliance is achieved.

  • RISKS RELATED TO MARKET, ECONOMIC OR FINANCIAL VOLATILITY AND OTHER RISKS

    Our financial position may be adversely impacted if announced dispositions do not occur as planned. (Applies to AEP)

    Failed sales of assets, including interests in IMTCo and OHTCo, could reduce expected cash flows and weaken financial condition.

  • RISKS RELATED TO MARKET, ECONOMIC OR FINANCIAL VOLATILITY AND OTHER RISKS

    Supply chain disruptions, tariffs and inflation could negatively impact our operations and corporate strategy. (Applies to all Registrants)

    Global supply-chain disruptions, tariffs, and inflation could restrict equipment and materials needed for reliable operations and strategic construction.

  • RISKS RELATED TO MARKET, ECONOMIC OR FINANCIAL VOLATILITY AND OTHER RISKS

    AEPTCo depends on AEP affiliates for a substantial portion of its revenues. (Applies to AEPTCo)

    AEPTCo relies on AEP affiliates for about 80% of consolidated transmission revenues, creating substantial customer concentration.

  • RISKS RELATED TO OWNING AND OPERATING GENERATION ASSETS AND SELLING POWER

    Costs of compliance with existing and evolving environmental laws are significant. (Applies to all Registrants except AEPTCo)

    AEP’s fossil-fuel generation remains exposed to costly and evolving air, water, waste, natural-resource, and health-and-safety requirements.

  • RISKS RELATED TO OWNING AND OPERATING GENERATION ASSETS AND SELLING POWER

    OVEC may require additional liquidity and other capital support. (Applies to AEP, APCo, I&M and OPCo)

    OVEC owners must fund their shares of approximately 2,400 MW of capacity, potentially requiring AEP liquidity and capital support.

All 17 risk factors

Headings as the filing states them, in filing order.

Other

  1. 01AEP’s transmission investment strategy and execution are dependent on federal and state regulatory policy. (Applies to all Registrants)
  2. 02End-use consumers and entities supplying electricity to end-use consumers may also attempt to influence government and/or regulators to change the rate setting methodologies that apply to AEP, particularly if rates for delivered electricity increase substantially
  3. 03AEP may not recover costs incurred to begin construction on projects that are canceled. (Applies to all Registrants)
  4. 04AEP is exposed to nuclear generation risk. (Applies to AEP and I&M)
  5. 05There can be no assurance that I&M’s preparations or risk mitigation measures will be adequate if these risks are triggered
  6. 06AEP could be subject to higher costs and/or penalties related to mandatory reliability standards. (Applies to all Registrants)

RISKS RELATED TO MARKET, ECONOMIC OR FINANCIAL VOLATILITY AND OTHER RISKS

  1. 07The amount of taxes imposed on AEP could change. (Applies to all Registrants)
  2. 08Our financial position may be adversely impacted if announced dispositions do not occur as planned. (Applies to AEP)
  3. 09Downgrades in AEP’s credit ratings could negatively affect its ability to access capital. (Applies to all Registrants)
  4. 10Supply chain disruptions, tariffs and inflation could negatively impact our operations and corporate strategy. (Applies to all Registrants)
  5. 11Failure to attract and retain an appropriately qualified workforce could harm results of operations. (Applies to all Registrants)
  6. 12AEP is subject to physical and financial risks associated with climate change. (Applies to all Registrants)
  7. 13Management cannot predict the outcome of the legal proceedings relating to AEP’s business activities. (Applies to all Registrants)
  8. 14AEPTCo depends on AEP affiliates for a substantial portion of its revenues. (Applies to AEPTCo)
  9. 15Compliance with legislative and regulatory requirements may lead to increased costs and result in penalties. (Applies to all Registrants)

RISKS RELATED TO OWNING AND OPERATING GENERATION ASSETS AND SELLING POWER

  1. 16Costs of compliance with existing and evolving environmental laws are significant. (Applies to all Registrants except AEPTCo)
  2. 17OVEC may require additional liquidity and other capital support. (Applies to AEP, APCo, I&M and OPCo)

Other American Electric Power 10-Ks

  • 2026 10-K risk factors

    22 risks, 11 new, 6 dropped, 9 reworded since the prior year. AEP newly highlights execution risks for projects serving data centers and other large-load customers, including cancellation and unrecoverable costs.

    Filed Feb 12, 2026

About this page

Item 1A of the 10-K on EDGAR was split into its risk factors and, where the company's previous 10-K is on file, each heading was matched to last year's and the text compared word for word. The headings are the filing's own. The one-line readings and the overview were written by a language model from the text of the new, dropped, and rewritten risks; they refer to risks by position and cannot misquote a heading.

American Electric Power (AEP) Risk Factors: 2025 10-K, What Changed | Gloomberb