Fitch changes Appalachian Power view

Fitch Ratings said it affirmed the long-term issuer default rating and senior unsecured ratings for American Electric Power Co., Inc. at BBB+ and affirmed its short-term issuer default rating and commercial paper at F2.

Additionally, the agency affirmed Ohio Power Co. at A-, AEP Texas at BBB+ and Appalachian Power Co., Kentucky Power Co., Indiana Michigan Power Co., Public Service Co. of Oklahoma and Southwestern Electric Power Co. at BBB.

The outlook for all of the subsidiaries is stable, expect for Appalachian Power’s outlook, which was revised to positive from stable.

The agency said the affirmation is based on continued improvements to American Electric Power’s risk profile as a result of its actions to exit merchant generation, transition of the regulated generation fleet away from coal generation, ongoing efforts in improve regulated returns, and expected maintenance of consistent credit metrics despite elevated capital expenditures.

Appalachian Power’s outlook revision to positive is due to the supportive Virginia regulatory environment and the likelihood of improvements continuing in West Virginia's regulatory environment, Fitch said.

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